I will agree with you that a cap raise is on the way (one which...

I will agree with you that a cap raise is on the way (one which I’m eagerly looking forward to) but I disagree that the company is not effectively using shareholders funds. It pays to take a pragmatic business view towards the numbers and not just spook on face value, as yes 65 million in expenses for a 17 million organic growth in ARR doesn’t look ideal.

However, spending does not exactly translate in growth within the current quarter. Case in point, look at the trend in employee benefits/contractor fees. Admittedly in 2016 employee benefits were 6 mil and the company grew ARR from 2016 to 2017 by 11 million, working off a low base but a great result non the less.

Employee benefit/contractor fees in 2018 was 17.5 mill, with ARR rising organically by 17.1 mill to FY19. Essentially a $1 COA per $1 ARR on employee benefits alone. The beauty of this is that employee benefits/contractor fees can be significantly reduced at the time when the directors decide to turn off the hyper growth taps, as these represent close to half of FY19 expenses. Essentially they are currently growing employee expenses nicely at their rate of growth.

Wisdom a company we spent too much to acquire you say?

Out of the 65 mil expenses 17 mil is attributed to the acquisition of Wisdom. Had lvt acquired Wisdom at the start of FY19, it would have brought in 11 mil in revenue. Wisdom is already a profitable company, as is hyperfish. Two very smart, forward thinking acquisition that are going to pay off in spades for years to come.

My advice, if you’re checking in for a week, LVT isn’t the stock for you. If you are here for the long term, then you are aligned with a company that has the same investment view from the look of their figures. I don’t generally like to share my own research on here as it usually is a waste of valuable time when it is not met with constructive retort but above are my views in relation to company spending. Ultimately do your own research.