Ann: Forecast Dec 16, full year guidance and interim dividend, page-2

A nice profit upgrade from SNL without the typical fanfare of an upgrade.

HY2017 Revenue is $47.7m up 9.5% from $43.567m.
HY2017 EBIT is $4.4m up 25.7% from $3.5m.
HY2017 NPAT is $3.0m up 27.2% from $2.358m.

Not only that, the full year guidance has been upgraded too.

FY2017 Revenue is expected to be $95m up 9.0% from $87.176m.
FY2017 EBIT is expected to be $8.5m up 19.2% from $7.13m.

Note that at the release of FY2016 report, management gave a much lower full year guidance for Revenue and EBIT, namely $92m and 7.5m respectively.

As a sign of confidence, the board has also approved an increase in HY dividend from $0.04 to $0.045, an increase of 12.5%.

The one area of concerns for SNL in the past few years is its inability to convert NPAT into operating cashflows. It seems that for SNL to be able to grow revenue, it has to invest in even wider and deeper range of inventories.

Now that the relocation of the DC is well and truly behind us, I would like to see management being able to focus on this and convert their inventories into cash faster. As much as it's important to grow revenue and profit, in my opinion growing free cashflows is equally as important, if not more important.

When they report their HY report in February, the first thing I'll check is their cashflows statement. Hopefully, they are able to show that they are growing their cashflows as fast as their other metrics.