G’day everyone!! Hope you are holding up ok
Sorry in advance for the long post !!
I have been buying quite a few more CCR shares in the past week or two – mostly at 18 cents, but managed to also grab quite a few at 17.5 cents & 17 cents today
A market cap of around $75m for CCR seems pretty well priced to me – given:
- They have been operating cash flow positive for the past 2 quarters.
- Revenues improved last quarter – past $10m in the Qtr for the first time.
- Gross margins are increasing as the digital collections % increases.
- Lots of new clients still being onboarded (including some large Tier 1 clients they won in the past 6 months) – with a solid pipeline of potential new opportunities.
- Lots of tailwinds for a company in this industry at the moment.
And based on the commentary from management in one of the recent videos, I would be very surprised if there wasn’t an upgrade to their current 23/24 guidance (revenue of $39m - $41m and underlying operating profit of $1m to $2m) sometime early next year.
Like others on this forum, I have run some estimated numbers for 23/24, and I think they are currently tracking for something like:
Revenue $44.5m
Less
Employee Benefits $25m
Legal $1m
Consultancy $1m
Prof Services $2.75m
Serv Del Fees $6.5m
Share Based Paym $2m
Acquisitions NIL
Other Expenses $3.5m
EBITDA + $2.75m
Depreciation $6m
EBIT - $3.25m
NPAT - $3.25m
So based on these estimated numbers CCR would end with a strong positive EBITDA number for this year (23/24), but revenue would probably have to hit around $48m to also have a positive NPAT figure in this financial year?
Think they are some chance of hitting $48m revenue for this year, but the next 3 x quarters would have to be something like $11.5m + $12.5m + 13.5m for this to occur – which is not entirely out of the question
If it doesn’t happen this financial year, then IMO CCR should definitely be profitable at the NPAT level the following year (24/25)
