Initial thoughts are the offer is too low, but this could just...

Initial thoughts are the offer is too low, but this could just me anchoring to my higher cost. Still deciding on whether to reduce exposure or hold although highly likely that price will fall should they reject this offer.

High level analysis of just the 4Cs show that margins seemed to have improved in 1Q24 (although note that what they putting into product manufacturing costs differs to what they putting in their accounts for cost of services plus cashflow timing issues), and even looking at their accounts, it looks like transactional revenue margins have improved slightly (but IMO their platform/software revenue share is too small).

Anyway, if we say they can maintain ~13.5m in quarterly revenues with ~65% margin gives you a gross profit of ~9m and their costs are roughly the same (staff costs are ~6m, advertising ~1m, other ~2m).

If they manage their costs, they could be breakeven and then they need to push the revenue lever.......and if they can do 3-5m in EBITDA per annum then easily justify a $50m MC

On the other hand, the bidder could quickly take out half the costs and be generating 3-4m per quarter in FCF so this is worth a lot more.....IMO around 100m

So long way of saying I'm sitting on my hands and waiting for 75c (although would be happy with 60-65c at this stage)

Receipts from customers
	FY2020	FY2021	FY2022	FY2023	FY2024
1Q	7,750	10,462	16,292	14,423	13,471
2Q	10,138	11,328	25,445	14,842
3Q	8,922	10,932	19,849	13,707
4Q	11,335	13,469	16,960	13,355
Total	38,145	46,191	78,546	56,327
Product manufacturing & operating costs
	FY2020	FY2021	FY2022	FY2023	FY2024
1Q	3,096	4,188	6,845	6,924	4,386
2Q	3,484	2,995	10,684	6,113
3Q	2,388	4,061	8,671	5,794
4Q	3,237	4,603	6,191	4,885
Total	12,205	15,847	32,391	23,716
Gross Margin $
	FY2020	FY2021	FY2022	FY2023	FY2024
1Q	4,654	6,274	9,447	7,499	9,085
2Q	6,654	8,333	14,761	8,729
3Q	6,534	6,871	11,178	7,913
4Q	8,098	8,866	10,769	8,470
Total	25,940	30,344	46,155	32,611
Gross Margin %
	FY2020	FY2021	FY2022	FY2023	FY2024
1Q	60.1%	60.0%	58.0%	52.0%	67.4%
2Q	65.6%	73.6%	58.0%	58.8%
3Q	73.2%	62.9%	56.3%	57.7%
4Q	71.4%	65.8%	63.5%	63.4%
Total	68.0%	65.7%	58.8%	57.9%