Nothing to dislike in this report. # EBITDA margin >20%. # Net profit margin 11%. # ROE circa 30%. # ROIC similarly at 30%. # Not afraid to take on debt...Borrowing increased 44% ....Debt/Equity a reasonable 29%....Debt is a cheaper form of funding than equity raising. # Increasing net asset backing YoY without resorting to equity raising. # Cash flow +ve after stocking large inventories....Adjusting for increase in inventories , its cash flow would have been $4m. # Sound balance sheet. In short....A high quality , well run business punching well above its weight of a small capital base. --------- What about Inventories? RFT's working capital is largely comprised of inventories rather than liquid current assets ....this ,in a declining market, may raise concerns about liquidity....But there is no sign of declining demand in the EV charging infrastructure space. I perceive stocking of inventories as a bullish sign for this market & these products.
RFT Price at posting:
6.0¢ Sentiment: None Disclosure: Held
