The thing is, yes, it might be a while before they are generating profits, however as they have explained each $1 million of inventory spend can generate $2 million of cash for the Company over 12 months. This will get faster as their level of stock turnover increases, thus product demand is key.
Therefore, if all goes to plan there should not be a need for capital raising's as this isn't some biotech company, in which we're betting on a trial result, the formula has already been proven. They have stated that they are now fully stocked and looking at their recent announcement $395,496 in inventory and $1,279,993 in prepayments, that should equate, according to their working example, to $3,350,978 in cash receipts that is yet to be received. Then you factor in the future RMR from selling all that inventory. Assuming my figures are far too optimistic, anything close to their working example as stated in January Update makes this company a promising bet in an intriguing growth market.
SCT Price at posting:
19.0¢ Sentiment: None Disclosure: Held
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