Chart and TA, page-44

I thinksomeone was asking about broker coverage recently. Some of the most recent LVT reportfrom Blue Ocean Equities is below (apologies for any formatting issues). I can’tget any of the data tables to copy properly but they’re forecasting ARR of $77.2min FY22, $94.2m in FY23 and $111.2m in FY24. Most importantly, in FY23 they’reforecasting LVT to deliver positive EBITDA of $6.2m and positive NPAT of $3.4mwith the numbers improving steadily from there. Cloud before the storm….

SOLIDQ4 RESULT: LVT CONFIDENT AND HOPEFUL OF A RESUMPTION IN FACE-TO-FACERELATIONSHIP SELLING

LVT’s June Quarterresult slightly exceeded our expectations and shows encouraging signs of arecovery in growth and operating cashflow. With a highly competitive valueproposition, LVT products provide a complete employee experience platform.Significantly, LVT offers a way for large enterprises in particular to digitallyengage with all their employees. This sets LVT apart in a competitivemarketplace. We maintain our BUY Recommendation, TP $0.33.

ARR AND CASHFLOW EXPECTATIONS WERE EXCEEDED

ARR at 30 June increased by 17% to $62.8m vs pep onan actual currency basis (BOEQ $61,9m). Quarterly cash receipts increased by30% to $14.6m vs pep (BOEQ $14.1 m). While the number of customers declined 3%to 1,078, this signifies a shift towards larger enterprise deployments of LVTplatform.

WINS EMPHATICALLY CONFIRM PRODUCT RELEVANCE, PMF

LVT recent contract announcement with Nestle addsto the previous win with a Fortune 100 healthcare company, each with over 300kemployees. These are two of the largest enterprise contract wins in theemployee experience space. It emphatically confirms the relevance and fit forpurpose of LVT's employee experience platform.

LVT IS POSITIONED TO ACCELERATE GROWTH, MAINTAIN BUY, TP $0.33

We maintain our growth outlook, based on theexpected resumption of normal selling relationships. We have increased ourEBITDA forecasts due to improved cost management. While the outlook is at riskto further delay from covid, the early signs are good. We maintain our Buyrecommendation and $0.33 DCF based Target Price.

BOEQ COMMENT

•Q4 istypically a strong quarter, however this result was restrained by covid and theinability to engage in the normal relationship selling model

•This waswell in line with our expectations however and we expect that going forwardinto Q1FY22 the gradual resumption of normal relationship selling will providea tailwind.

Early indicationsare positive with LVT commenting that there are a number of RFP’s on foot withover a dozen potential customers targeted in the >$100k pa size.

LVT’s emergence as a leader in the large enterprise segment is ofsignificant benefit to the company in terms of product validation andattracting the attention of other enterprise clients.

• The key differentiatingfactor for LVT is that it is able to offer both a traditional desktop

solution and now amobile solution through its Reach product. This is of significant benefit tolarge companies whose workforce typically do not have a work-related email ordesktop.

Covid has provideda catalyst for the adoption of employee experience solutions as remote workingis here to stay and companies seek to ensure business continuity.

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• We expect LVT to continue to developproducts and new onboarding strategies. While it is easy to focus on enterprisecustomers, LVT’s products serve all companies and it would be logical thatsmall companies can access LVT products in a light touch, client driven, cloud-based deployment environment.

EARNINGSREVISION AND VALUATION

EARNINGS REVISIONS

We have increased our ARR forecasts by 2% in light of this result,however we maintain our revenue assumptions steady as we expect some extendedcustomer forbearance. We have also downwardly revised our operating costs by 4%in FY22 and 1% in FY23 to reflect better expected ongoing cost management, withthe result that our EBITDA outlook improves commensurately.