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Ann: DW8 Secures Institutional Funding Launches Entitlement Offer, page-352

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tdci

306 Posts.

48

24/08/22

10:35

Post #: 63288475
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Originally posted by mondyinvest: ↑

Hi @shwibble. I'd be somewhat cautious thinking about valuing a company by simply comparing revenue to market cap. At today's 0.9c share price, the company's market cap is $22.4M. So if you were going to buy the company outright, for $22.4M you'd be getting:
$19.4M in revenues and $3.9m in cash and undrawn loan facilities (prior to the most recent CR)
However you're also assuming responsibility for -$31.2M in operating expenses p/a (of which -$12.8M is spent on staff costs alone)

Yes, they have raised some more cash recently, and are suggesting they will reduce the cash expenses by ~$4M p/a, but by that estimate they'll chew up around -$27M in expenses next year. So they need to grow revenues by around 40% just to break even by end of FY23. That growth needs to be organic; as I'm sure holders are now aware, growth by acquisition is expensive and often doesn't deliver shareholder value, unless large cost-cutting synergies can be realised. Cheers

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Thanks Mondyinvest, these numbers are the final nail in the coffin for me. I was lining up at 0.7c thinking this would be a good longer term recovery play. I can't see this surviving now without constant raisings at huge discounts.
They need a miracle to keep this dream alive.
Last edited by tdci: 24/08/22

DW8 Price at posting: 0.8¢ Sentiment: None Disclosure: Not Held
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0 Great analysis

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