Had the pleasure of attending the AGM on Tuesday. Lot to like about this Company and certainly provided some beneficial insights in terms of their future. I took a first position in RPM earlier this year looking to build on that based on reported progress.
Herewith some points & observations gleaned during the AGM.
1) Executive Team is lean, progressive, experienced and very clear on strategy /business direction. 2) Product Development (Software) in recent years has established a platform which is delivering real measurable benefits to the mining industry. 3) Company have earned a dominant and respected profile with all the majors in Mining 4) All divisions reporting strongly, but software subscription business presents as the biggest growth prospect 5) Subscription sales will cannibalise perpetual license business to a point, but where country risk is a consideration, perpetual licensing will remain the preferred route 6) Given the strong balance sheet and future cash generation, acquisitions are being considered. Prospects need to offer a complimentary vertical to the current suite. I came away that due to the selectivity and equal chance of seeing a share buy back within the next 24 months. 7) Reading between the lines, Company had a great first quarter and clearly up-beat about FY2020. My take-out is that the Company have played the ‘long game’ and we now enter the ‘payback phase’. 8) My investment case hinged quite heavily on reduced Development spend falling to the bottom line. Whilst we are likely to see this to a degree, the Company have been working on new Software which facilitates ‘real time’ mine design. Got to see the prototype in action for underground mining and by all accounts, will be super efficient in terms of resource time and design agility. I suggest ‘watch this space’.
In summary, we have a solid business, great leadership team, an abundance of expertise and some ‘world class’ products and ideas which they are in the process of monetising. Add to this a strong balance sheet with zero debt and the future can only be described as ‘bright’.
Please DYOR. Hopefully these insights assist.
Rokewa
RUL Price at posting:
79.0¢ Sentiment: Buy Disclosure: Held
A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.
(20min delay)