"Agreed. With EV of $33m and cash balance up $1m over second...

"Agreed. With EV of $33m and cash balance up $1m over second half they may be generating 7% annualised FCF as we speak.
With sticky revenue and steady growth it looks like a screaming bargain."

Yes, while it is a negative working capital business, the size of cash increase did surprise me somewhat. Of course, the devil is in the detail, and we'll have to wait and see what the drove that strong cash flow, e.g. unusually low level of working capital at the 30 June balance date, sharp reduction in investment in IP development, or some sort of government payment/R&D rebate.

Whatever the explanation is, I think its 18-24 months too early for KYP to be considered to be a $2m pa FCF company. I've no doubt it will get there during my investment time horizon, but I don't believe it is there already.

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