6 months on DJ@djwally where is EN1 is now. losses growing revenue reducing. Not remotely close to profitability or EBITDA + is the outlook rosy or is this company a basket case
Originally posted by djwally:
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As usual you are being pretty biased in your analysis here. Sure the revenue growth is pretty low over the last 5 months. We are in the midst of a shutdown in the US economy if you hadn't read about it. So thank goodness we were on track in Q1 for such a stellar year which saved our bacon. basically EBITDA came out pretty close to zero which is incredible in the worst economic shock in a century. Many of their competitors are down far worse from this shock to the advertising sector. But there is the hope that as the economy opens up now, going into peak advertising season we will start to see growth. And growth will see us bust into positive EBIDTA and profitability. So we are well poised. Which brings me to your second disingenuous point around a $4M loss. You know full well that much of that is accounting trickery not impacting the businesses real bottom line - firstly around performance share issuance which we all knew was coming and had to hit the bottom line at some stage. But given we are not profitable it is irrelevant as there is no money to divide up between us and pay out to shareholders. And also note that the share price that those options and performance shares were calculated at is 1.6c which is around 3 times the current share price. So based on todays SP, the impact on the loss would far less. We also all know that the financing costs around Alto were awful and they are getting reamed. But thats why Ted has just done a capital raise at 7.3c to raise $2.1M to retire that awful facility. Hope we hear about this closing out in the coming days. It will be a big positive for the share price. In the worst case scenario if Alto dont want to deal, they can just keep making cash based amortization payments at ~103% of the headline rate. So the Alto damage should just about be over. Dont expect any huge share issuance again to Alto. All we need is for revenues to start ticking up again in Q3/Q4 as the US economy opens up again. I believe the worst is behind us and if the worst is a $220K EBITDA loss then things are actually starting to look pretty rosy. As compared to the current market cap which has us priced as a total basket case. As we know there were plenty of sophisticated investors who saw the upside value at 7.3c who would have been given some insight into the business. I believe we have Alto retirement, a new interest only debt facility and revenue growth return into Q4 to look forward to in the near future. I still think $20M revenue and profitability in H2 is in scope. Plenty to look forward to folks so just tune the doomsday crew out for a bit.
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