As I said, on the surface …. after having a detailed look here are some of my comments:
I am always concerned when the disclaimers and warnings are in small print, as if they are unimportant, and as in this first slide.
There is an incentive for the company to present a rosy picture, which can default to hype, so a detailed examination is warranted. Afterall this company is known for making specious announcements.
One only has to look back to a similar announcement on 22 April 2021 about “110% YoY growth in revenue”, “Record Group revenue $3.9m”, $4.9m cash in bank. Sounds familiar.
It is always disconcerting to have conclusions pushed in your face too early, such as “first phase of turnaround completed.” There is no evidence for that from my understanding of a turnaround.
There is no evidence presented to warrant the statements “strong foundation for future sustainable growth” which would need to see advance orders and production figures, nor “Progress in enhancing future growth capabilities and stability of Spacetalk.”
This is not a full financial report, as some have observed, it is only the top line.
The use of the term cash flow is incorrect. Cash flow consists of several components, and this is just the revenue part, which is an unreliable indicator when used in isolation. There may not actually be a “record positive cash flow growth” what ever that means.
But there are no net profit figures, after COS. It is easy to get good revenues at for instance high discounts with little profitability.
But a turnaround is a bottom line matter, and a sustainable one. There are no bottom line results provided, so no indication of the true status, risk, prospects, and how long the available funds will last.
And I am very concerned with the statement, “(as December sell-in orders ae paid in Q3)”. It suggests to me that there has been an effort to get payments in early, perhaps to make it look good, so the Q3 might be a let down if it usually reflects cash received from Q2 sales (on a cash accounting basis I presume).
I’d wait to see the full P&L/BS/CF statements before I make up my mind. I hope it’s good but it looks a bit like the same ol’ same ol’ too.
All just my thoughts as I analyze the presentation from my perspective.
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