Ann: Appendix 4C - quarterly, page-18

These are my comments from reading this 4C

1. On a cash-flow basis the company is improving - but has a way to go to break -even. Actual accounting based profitability is probably 12 months away.
2. If read in conjunction with the latest company update - the outlook for revenue growth ( and hence cash break even ) is good on a full CY basis based on average levels of pipeline conversion - I expect that these numbers will become clearer in Q3-4.
3. The cyclical nature of business in any part(s) of Asia is a fact - this is a good thing in terms of transparency going forward - for those who didnt understand this as a matter of course.Similarly no references to VIN - should underline that the company has indeed moved on from the nonsense of that technology and all the associated 'news' and expectations surrounding that technology. Secure Enterpise networks aren't the domain of an app.
4. There are a number of credible resellers now in place and working at commercialising the technology to suit their particular client needs.
5. Significant repeat revenue is probably 12 months away - depending on the nature of sales made ex China - but will be obvious in China by end of CY.
6. I would like to see a retail (mass market) dumbed down version of the product for basic home use and the growing number of applications and use cases for mass market - however I suspect that this will have to wait for greater availability of working capital and a more established Enterprise level footprint.
7. The company could do better in packaging its product offer(s) ex China - it is fair criticism to suggest that the capability and quality of its Enterpeise offerings lack the polish and sophistication regarding the marketing material and information available in the public domain compared to competitors and make it harder for lay people to understand just how good the technology is in comparison with any competitor in a very competitive global market.
7. I expect that the company should be able to begin attracting more institutional support for the shares - I dont expect this to correlate to strong price action - as the number of speculative investors outnumbers longer term holders so there is a natural and easy pathway to achieving a base level of holding sans the need to push prices. However I dont have a high level of feel for this - the stock price reached irational levels based on hot air a while back - and if the so called 'cold war' and China de-escalates at the sae time as alternative drivers of revenue growth emerge sometime in the next 12 months - the share rpice could achieve parity in terms of valuation with peers sooner rather than later.