You vaguely allude to something I mentioned several days ago...that is, a "left of field" announcement.
As I posted earlier, we are likely to see yet another healthy 'Appendix 4C' for June...one that should, at the very least, underpin the current share price...but I am hoping for much, much more in coming weeks!
Each month that goes by...showing yet another profit for TOX...is another sign to the market and OTHERS, that the current business model is viable...and perhaps more importantly, appears very sustainable.
This is all good, however the fact they are running near current capacity, suggests there is little room for further increases in cash flow going forward. This is likely to result in only a gradual rise in share price over time, as the market slowly returns TOX to "fair value", as it makes the transition form a loss making company just 12 months ago, to one with an eps now approaching .007cps.
Good investing, but not exactly exciting!
So what do they need to do to get the market firing?...in my opinion, TOX needs to do one or both of the following...
1. Expand organically or via acquisition...locally and/or interstate. This way they can take advantage of; their existing (lucrative) permitting arrangements; the current resources boom and increasing order book and of course; their obvious expertise.
2. Increase capacity at the existing facilities, without the need for shut-ins...ie, add completely new circuits and not just upgrade the existing. This way, the current "high value" treatment can continue, whilst new "high volume, low value" circuits are added.
This is all very achievable, as long as TOX keeps performing to expectations...that is, while current profit margins continue, forward orders remain filled and the resources boom continues...all the things that most bank managers would like to see before lending them any money!
Given what the new TOX management have done with the company so far, they don't strike me as the sort to sit on their hands now that TOX is finally making money, especially with so much work confirmed, so far out...LOL...that is virtually money in the bank!
Stay tuned people...I suspect TOX is more than just a pay-cheque for these guys.
Cheers!
TOX Price at posting:
0.0¢ Sentiment: None Disclosure: Not Held
