I finally had a chance to review their financials. I have not managed to get my head around their trade receivables. Their trade receivables (current) jumped by 5Million which is almost all of their net profit. Why do they have such high receivables, when their model is customers paying upfront for the treatments that are provided for 3 to 6-month period. Are they having difficulties in recovering amounts from franchisees?
Gross Profit margin has been squeezing by 4% each financial year since 2021. 4% GP Margin on 75M (2023FY projected sales) equates to 3M, quite a substantial squeeze considering their net profit.
Increase in finance costs (22M loan on the books) will further add to their problems.
Cash inflows are minimal.
Thoughts?
Ann: SILK H1 FY23 Results Presentation, page-2
-
- There are more pages in this discussion • 3 more messages in this thread...
You’re viewing a single post only. To view the entire thread just sign in or Join Now (FREE)