Ann: Appendix 4E and 2020 Annual Financial Report, page-2

I have already sold my position at a loss from the IPO price. I’m still disappointed in myself for buying into a vision without execution.

In summary as of 30 June:

1) NTA per share: 2.30 cents - cash is $2,641,715
2) Loss after tax: $3,157,649 (prev $3,383,186)
3) Aggregate directors / key management personnel cost: 1,182,686 (prev $613,977)
4) Sales: $1,181,096 (prev $1,407,405) - recurrent revenue has increased from 53% to 60%
5) Accumulated losses to date: $16,029,612

The Going Concern statement says that the company continues to incur losses, but the Directors believe that the company *is* a going concern due to new customer orders, reduction of cash outflows and access to capital markets. The report also states that the company can access the R&D rebate, and JobKeeper.

My takeaway on this is:

1) The company has continued to show ongoing losses, with no fundamental turnaround or improvement over previous years.
2) Sales performance is not on trend to lead to profitability.
3) The company is heavily reliant on government funding to continue to exist - how long will JobKeeper etc last?
4) Expenditure on the product and sales has not yielded results, as shown by the sales performance (albeit, affected by COVID).
5) Raising more capital, unless from external investors, is unlikely given past performance. Any further capital raise would also dilute existing shareholders.
6) The company lacks a viable business model and is unsustainable. There is no realistic likelihood of profits in the forseeable future, or before shareholder funds run out.

...but I could be completely wrong. What do others think?

I revise my previous fair value of 5 cents downwards. NTA is 2.3 cents per share, and between the reporting date and now, I expect that the company has lost another $400K. So I think that a fair value is closer to 3.5 cents.