Another after hours announcement. I am not sad I sold – the numbers tell the story at this stage.
Marjan and Nicholas took home $1.55m and $1.13m respectively. Total remuneration for key management (incl. shares/options) for the year was $3,898,388! Meanwhile, Respiri brought in operating revenue of just $270,074 (the ‘other income’ is very much propping up the overall revenue figure).
I can only repeat what madness it is, that Respiri waited until mid-June to formally withdraw their $6m to $8m CY guidance. Just to recap, this is what the company were aware of on the CY incoming receipts from customers side: Q1: $1,000; Q2: $1,000. I would like Respiri to disclose how many Wheezo devices have
actually been sold to end customers. But I think there might be a hint from the subscription sales: just $732. Separately, I’m not sure how they are getting operating revenue of $270,074 when each quarterly showed receipts from customers totaling $175,000 – what is the gap?
Anyway, I can only see this going one way, which is a Capital Raise pretty soon. Consider that in FY2021:
- they raised $12,500,000,
- brought in only $175,000 in customer receipts,
- made an operating loss of ($11,040,347)
- their net cash used in operating activities for the past year was ($7,339,097)
- and they had $7,973,188 cash in the bank as at 30 June.
If we think they’re going to make that cash last at that current burn, while they try to launch in the UK end of this year, and later in the US, without any significant revenue suddenly coming in... only one way to keep running. Page 26 of the report says this with respect to Respiri being able to continue as a ‘going concern’:
“The directors believe that there are reasonable grounds to expect that the Group has the capacity to raise capital. The Group has a strong track records of accessing capital when it is required to advance its portfolio”
Maybe Respiri will make it big, but as Benjamin Graham says, this is currently an OPM company – running on Other People’s Money.
At a market cap of $67,220,000 I have to change sentiment to 'Sell'.
