Ann: Preliminary Final Report, page-5

operating EBIT margins generate cash flow of 23% of sales . Sales ex SA health now $4m and growing with the acquistion in July which I assume adds 500k to 750K to sales , translates to operating cash flow of around $1million next year assuming steady state debtors.

all operating cash flow is reinvested in product development , which is business as usual for software developers. The more cash they make, the more products get developed/enhanced and vice versa. that is why cash flow is fine, but growth comes from R & D and investment in sales channels

I always pay homage to the comments of Trevor Sykes a few year ago, he said when investing in IT companies remember they will spend all their money on product development until the money runs out.

Risk has been substantially reduced with broad customer spread and quality of the products and annuity type products like Referralnet


As long as they maintain slow and steady growth I see share price growth around 20 to 30% pa, outperfomance will come from international sales channels. GLH highly leveraged to sales growth , however it is expensive and risky to try and grow sales quickly so I assume management prefers slow and steady

Could be a bright spot for portfolios in a very rocky equity enviroment but cannot see any real excitement here for 6 months. Further M& A could be a catalyst.

one for the long term punter