Ann: Quarterly Report & Appendix 4C Webinar Notice, page-13

I sold out of BTH earlier this year largely getting my investment back after having held for just over a year - which I admit is not a reasonable period of time for a long term investor to prove an investment thesis. So with that out of the way, here's why today's good result doesn't get me buying back in.

When I look at 4Cs, I always analyse trends over time, including PCP comparisons and more importantly the trend in the rolling TTM. Looking at the last 8 quarters, 12 month rolling average operating cash has progressively trended from around -$3m to -$12m, albeit I agree with some remarks here that this Q might be a turning point.

In order words, over that time in which ARR has more than doubled, there is no overall trend towards improving cash generation at the operating cash level. Good SaaS firms (look at PPH and XRO as examples) generate strong operating leverage, which you can see strongly in the trend in operating cash flow. I can't see it yet in BTH, so I can't justify buying in or holding at a multiple of 10 x Revenue.

For now, it is yet another one that stays on my watchlist. If this quarter truly marks a turning point, then I am wrong and will forego the inevitable SP appreciation. But there are better bets out there based on the number.

GLTAH