Ann: Half Yearly Report and Accounts, page-64

Hello all,

Looking for a few stocks going on sale in the current climate and this sparked my attention due to the directors all filling their boots recently as the SP has been tanking.

I have a question though for current holders and that revolves around revenue growth rate. I'm concentrating on BTM sales as that is the underlying growth figure to be interested in I think rather than revenue generated from BATAM.

Its the rate of Half on Half revenue growth that interests me to justify the premium MC here.

So recent figures:

H1 2019 - $3.75m
H2 2019  -  $5.55m (48% HoH growth) - tick
H1 2020  -  $ 8.57m (54% HoH growth) - tick

In the half yearly H1 2020 the following commentary was provided:

"Based on year to date performance the company now expects that NovoSorb BTM sales for FY20 should comfortably double FY19."

So FY19 sales were $9.3m. Double that and you have $18.6m expected for FY20. Take away the $8.57m already booked for H12020 and you are left with $10.03m for H2 2020.

So H1 2020 - $8.57m to then a $10.03m H2 implies revenue growth slowing significantly to 17% HoH.

Now I note management have used the words comfortably double and so I think it is safe to assume they expect to do better than just double, but to justify the current sort of MC we are seeing, surely more than comfortably double is required? Continued revenue growth around that 50% HoH is what is needed and that gets you more in the realms of a $13mil H2 2020 and full year FY2020 revenue of around $21.5mil. Then you add on top BATAM associated revenue and your getting to a $25mil FY2020 in revenue?

Is this the sort of result current holders are expecting for H2 20 and FY2020? Are management generally conservative with their guidance re: sales?

I just see a big difference between 17% HoH growth (doubling of FY19 result) and the continued 50% HoH growth I think is needed to justify the MC.

Thoughts?