Yawn, more waffle and arm waving ... and the 1Q23 revenue growth number of 143% they quote is so dressed up because they have measured the growth off a VERY weak 1Q22 ($0.56m). Remember they achieved $5.2m revenue in FY22 ie $1.3m per Qtr on average as compared to $1.36m in 1Q23 of which maybe $0.5m (US$0.35m) was a prize. Oh, and they made $6.1m revenue in FY22 or $1.5m per quarter.
Incoming equity needs to know the following otherwise there may not be any!!
- how much will the cost reduction measures save on an look forward basis? ... both run rate savings as well as costs to implement
- how much will executives be reducing their salaries?
- how much of the upside will be given away in terms of additional options being issued because of salary reductions? ... options aren't a bad thing but terms could be a major drag
- what are the staff engagement scores? (they probably don't measure but I reckon it'll be getting toxic - good people can find safer jobs)
- what does the current balance sheet look like? ie today, not as at 30 June
- how much has rising US$ squeezed them... ie rising US$ costs and negligible US$ revenue yet funded in A$?
- how much do they need to raise just to pay existing creditors let alone to fund future plans?
- is there any threatened litigation from any creditors?
- what is the funding ask immediately as well as for 6, 12 and 24 months?
- is the outstanding payment for the cancelled Clinichain Trial being challenged? ... 'cause CDX has no war chest to fight!
- which part of the business plan will be put on hold or stopped if they raise less money than they want?
- what measures will be put in place to make the Board more independent to protect minority interests? .... particularly where conflicts arise between management as equity AND DEBT holders and other shareholders?
It's not hard ... unless the picture is worse than already down trodden expectations.
blah blah blah
All my opinion ...
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