I think we had a misunderstanding and I apologise if you thought my intention was to make this a backslapping positive only conversation. I did not. I only meant to try and keep the forum easy to read for others and also convenience myself.
As such I will fully admit that margins are and have been the biggest concern for cnw. If margins slip even slightly on the traditional business it goes cashflow negative and thus the drive to move to the lower revenue but higher margin managed services.
Currently as we discussed their trade balance including cash is around 1million if you take the 3million for the correct comms out. If cnw goes more than 1million negative cashflow in a quarter then all of the current upward trajectory has been erased by some margin. It would be very bad. They would then have to dip into the 830k borrowing facility or raise capital.
I think this is unlikely and I also think with the upward trajectory of the managed services you'll see the trade balance continue to shift back towards neutral quarter to quarter as those two businesses likely have different billing cycles.
