The company is starting to build its GP margin with a new suite of products, and winning new contracts. It has $14.2 mill in recurring revenue at approx 46% GP margins and fixed costs and interest of approx $7.5 mill. It has an additional contract revenue of $4-5 mill at approx 25% margins.
As soon as they win some further new contracts, I expect their GP margin to get to 50%+ and recurring revenue to rise to $16-17 mill.
Its been a long road to recovery, but they are on track to start benefiting from the leverage of higher margins, higher revenue and fixed costs not materially changing.
How to pay the debt? $1.8 mill in warrant money, $2 mill in cash, $1 mill in R&D claim and increased positive cash flow.
Its ground floor value at these prices IMO
SW1 Price at posting:
2.5¢ Sentiment: Buy Disclosure: Held
