After having a little time to reflect on the quarter for Alcidion: It's a pretty below-par performance for a company is that valued so optimistically.
I spoke with Kate towards the end of FY21 and she spent a lot of time elucidating that the company were to undertake significant investments in its operational capacity throughout FY22 and thus implying that this year was a "Break-even" year for the company. FY23 was the aim for maiden operating profits.
Thus this 4C result in terms of operating and free cash flows was perhaps to be expected.
The cost base rose 22% from 8.1m to 9.9m QoQ whilst receipts only rose 2% on PcP. (The cost base rose 31% PcP).
I do understand there is significant seasonality when it comes to ALC's operating performance. (See below).
In saying that, I expected >2% top line growth.
The reason for the growth or lack thereof is as follows:
So on this basis, if the next 6 months do not bring some fairly sizeable contract wins then I believe shareholders have a problem on their hands.
The macroeconomic tailwind towards digitising the healthcare space is what keeps me an Alcidion shareholder today (With reference to below).
Otherwise I own part of a business that seems very promising and is priced as such by the market thus putting me in a situation whereby
a) They execute and I sort of win (Because most of the success is already priced in)
b) They fail to execute and I lose, a lot.
For context, here are the results in terms of receipts & operating cash flows:
