Hi Ant,I think they're up to 1.35b ordinary shares on issue as...

Hi Ant,

I think they're up to 1.35b ordinary shares on issue as they have issued 88m shares in the current FY. On top of this are tens of millions of options (though they will likely largely expire out of the money). I expect they will draw down the debt facility in full, so $59m, by the end of CY23 (not FY23). I'd factor that into any calculations you do. Cashflow will likely be weak throughout the year, and if it's going to improve it won't be until Q4 and even then only if they break several years of bad management habits quick-smart.

For a services company that only has $7m cash in the bank, $46m debt, and is barely cashflow positive, their valuation is massively overstretched.

They're also currently missing their own EBITDA growth guidance:
Q1 $2.5m (+26% on track, apportioned guidance was $2.6m)
Q2 $2.6m (miss, guidance was $3.2m)
Q3 $4.7m forecast
Q4 $9.4m forecast

Assuming they hit the next two quarters, that's $19.2m EBITDA that will reduce down to an NPAT between -$8m and +$2m on a current EV of $187m (@ $0.11/share).

This company needs to be taken private, with the management stripped out. Decent operators would be squeezing $10-15m NPAT out of this zombie amalgamation of businesses.