BCC beam communications holdings limited

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I think a lot of people have simply lost interest in the state...

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dbd25

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30/10/24

15:58

Post #: 76378832
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Originally posted by Access2020: ↑

The big takeaway in the 4C is the note on the suspension that states that they will detail their short term strategy AS WELL AS DETAILING A SIGNIFICANT COST BASE REDUCTION. That's a BIG plus from me.

It's fairly obvious that all the tech and product related areas related to Zoleo will be cut substantially. What's the right balance here? Once the dust settles my starting assumption is they will still be a manufacturer of the product for Roadpost but at a better margin. Do they finish and complete the new capabilities they've mentioned or do they sweat the product and try to extend the useful life to make some margin back? Hopefully there's some detail here.

With a smaller team, you'd expect some management layers to consolidate. The elephant in the room will be Michael's salary. He's under contract but with Zoleo exiting, which means lower growth and a smaller company, everyone will need to take a hit. Will the board go there or will they take their chances?

As for the quarter, probably a bit better than I was expecting. I'm glad they split out Zoleo and the core business so we can see performance. The core business was up by 13% PCP, subscription revenue was up 41% but the overall business was down 1.2% PCP. So for those playing at home that means that device sales were down in a big way - is this demand driven or more likely, has this been driven by the litigation. In other words, have RP not been paying or is Beam holding back stock so that it can now reprice with a better margin. It would be good to know a bit more on this.

Overall cash looks adequate to see us through. I don't expect a CR. There will be a bunch of redundancy charges but then the run rate should substantially drop. A key question will be what will the future legal costs be post the arbitration decision. This is a tough one. All shareholders have endured a big spend here and it didn't go our way. Do you fully concede or put up some defence to protect our interests? Again, more detail here would be good.

So at 15c we have a market cap of $13m. The business is net cash, so if I adjust for lease liabilities, then the EV is $10.8m and that's before RP buy out our half of Zoleo for what I'd estimate to be $7.5m to ~$20m less costs (that's our half btw). The growth factor has certainly gone but once the dust settles it's hard to make an argument that the company is over valued at present levels, particularly with an asset sale on the horizon. I'm very keen to see more detail later this week.

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I think a lot of people have simply lost interest in the state of the company's finances. What is the point of BCC if they never give anything back to shareholders ? The company should be dissolved. Give any proceeds left over back to the shareholders. At least it would be something.

all imho, dyor

BCC Price at posting: 15.0¢ Sentiment: Sell Disclosure: Not Held
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I think a lot of people have simply lost interest in the state...

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Week 24 Wrap: WW3 looms (again); US econ data tepid & silver surfing

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I think a lot of people have simply lost interest in the state...

Top Stories

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Clinuvel shares dip, even as CEO comes back from temp leave

HotCopper Highlights, Week 24: Israel boosts Energy; Meeka eyes production & Mag7 back

Iberian expansion: Megado turns to Europe with Spanish copper mines

Listen: HotCopper Wire Podcast 013 - They changed the IPO rules (and that's a good thing)

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ASX Ltd notches upward on sale of company meant to fix CHESS 3 years ago

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Week 24 Wrap: WW3 looms (again); US econ data tepid & silver surfing

Featured News

Buyers (Bids)

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