A journey to the north - 1pg ($1.20-1.50), page-192

1PG is dealing with fortune 500 companies. These companies aren't going anywhere, and will make payments as they fall due.

Revenue is trending upwards. An increase in revenue is correlated with an increase in the trade receivables. Once the first set of receivables falls due, we will see cash receipts. You cannot judge the recoverability of these receivables if they haven't even been due yet.

The good thing is that the company has $37.8M in the bank as at 31 July 2016. Compared to the previous quarter ($41.2M), this represents a cash burn of $0.85M per month. At his rate, they can sustain their operations until April 2020, with NO revenue/ cash receipts.

But, we know that we have revenue, and that cash receipts will start coming in once the receivables become due, which should be in the next 6 months. After that, the cash receipts will be flowing constantly, provided the revenue from booking keeps increasing.

As of today, I estimated that they would have around $37M in cash, and at 154M shares outstanding, gives the cash backed price 24c.