Ann: Appendix 4C - quarterly, page-78

It did age well? It considerably reduced cash burn in the following two quarters.

I think the focus needs to shift away from cash flow to profitability. As KTD ramps up, so will it’s working capital. There is a lead time between spend and receive. Payments are made for supplies, which then are produced to goods (to purchase order). Revenue is only booked once production is complete and the product shipped to the customer.

I would be more concerned if the cost (or cash) blowout was due to excessive marketing or other overheads (recurring wages). In this case the cash blowout is predominately due to purchase of raw materials for us to produce and sell. Okay, the one-off salary costs aren’t great, but some pain taken to possibly clear dead wood and bring forward profitability. I for one will be looking out for a drop in salaries and wages in the next quarter.