I would think a special dividend would be on the cards as opposed to a buyback, as management have stated their goal of increasing the market cap of the company. So with net cash becoming positive again in February "and expected to continue to build in 2H", we can look forward to an announcement later on this year.
What wasn't pointed out by the company was the 2.7% rise in Gross Margin on pcp. My guess is that new products introduced are not only resonating with customers (especially in Europe), but the company is also making a higher margin on these products. Let's hope so.
As we've seen in recent reports, the company has been able to hold costs steady while increasing sales. In 1H20 gross profit rose $0.7m and almost all of this flowed through to Profit Before Tax (Up $0.65M). It's worth noting that it is the first time Net Profit Margin has been above 10% since FY2015,
So we have a favourable trifecta effect on net profit here, higher revenue, higher gross margin and steady cost of doing business!
XRF Price at posting:
26.5¢ Sentiment: None Disclosure: Held
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