Ann: Re-opening physical stores, online and market update, page-4

Solid news for AU8 to begin the task of rebuilding the B & M channel.

I am more strongly swayed that COVID-19 fast tracked Broadway's online presence. That can never be a bad thing since it was untapped at the time of purchase and needed some dedicated time and targetted money spent, which the virus guaranteed to happen.

I hold no illusion that offline sales recovery will be slow and frustrating, but I think AU8 will have taken a quantum leap in the realisation and exploitation of online product sales, bearing higher margins and lower costs.

I continue to believe a SP of around 20c would be a 12 month target, as expected pre COVID-19. Maybe I now push the timeline out to 2021 Q3 and exclude any 2nd wave impacts.

Through the lock down, AU8 has demonstrated that it is nimble and ready to take decisive action. It has also proved its multi channel marketing approach is more robust than naysayers thought.

I don't eliminate the prospect of a CR over the next 9 months to consolidate the capital position of the business. For the right reasons, equity instead of debt would make a lot of sense to put the company in a sound working capital position. This may encounter resistance from those that paid 16c per share on the last raise, but structured correctly, they would not be disadvantaged. Watch this space?

I have upgraded my sentiment from hold to buy based on trading updates that clearly indicate consistently strong online sales since Chinese New Year.