> Potential income from sale of inventory-Inventory 514,896 x...

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Angus1000

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02/03/20

21:31

Post #: 43267429
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Originally posted by mwskinner52: ↑

The cash position is not great but if they can sell the stock and get paid quickly then that will improve.

Trade and other receivables 208,075 (not much owed here, presumably CIO does not allow extended credit terms or nothing much was sold in the last 2 months of the half)
Trade and other payables -1,047,603 (creditors owed a lot here, presumably CIO has negotiated extended credit terms )
Inventory 514,896
Cash and cash equivalents 1,280,948 (adequate for the short term)

Potential income from sale of inventory-
Inventory 514,896 x 40%= 1,287,240

Pluses-
CIO hired several experienced sales and marketing professionals as part of its strategy to kick off its SaaS product
offering. New sales and marketing people are focusing on service provider markets that would allow the
Company to generate recurring revenues through additional services facilitated by the Company’s hardware
products. (This also a minus as will be a cash burner until crossover is reached of subscriptions vs payment of sales staff, on boarding expenses and other outgoings)

The Company previously announced its expansion into the US Internet Service Provider and Multiple Service
Provider space. These relationships continue to develop, and there are currently numerous other trials
underway.

There are several new original equipment manufacturer (OEM) deals in the pipeline, some introduced to CIO by its operator partners in North America.

Minuses-SAAS product cash burn.

* Flat sales growth for last quarter. Sales hopefully will rebound this quarter as previous correspondence touted.

CASH or lack of.

The Directors are confident that the Group will convert inventory to cash, receive outstanding committed funds
and access funds via increased sales revenue in the coming quarters. Additional funds may be required through
the issue of new equity or securing of additional loan funding by way of manufacturing finance facility, should
the need arise. However, should neither eventuate, there exists a material uncertainty that may cast significant
doubt on the Group’s ability to continue as a going concern and therefore, the Group may be unable to realise
its assets and discharge its liabilities in the normal course of business.

Raising cash at around .002 a share is not going to be very effective.

Need that sales growth to get the share price moving up and instill confidence in the company!

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> Potential income from sale of inventory-Inventory 514,896 x 40%= 1,287,240

Inventory is carried at manufacturing cost is it?
If margins are 40% shouldn't potential income be $514896 / (1-0.4) = $858160?

Why is cost of goods sold so high?
Does that include cost of goods manufactured but not yet sold (inventory) or just cost of goods sold (revenue)?

CIO Price at posting: 0.3¢ Sentiment: Hold Disclosure: Held
1 Upvote

0 Great analysis

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