Originally posted by ZMan
I’m not expecting the Class B milestone to be met. It requires $15m revenue in the 12 months to 28 Feb 2019.
That includes 4 months of Fy18 revenue before the MKM acquisition, and the first 8 months of FY 19 revenue which includes MKM revenue.
Fy18 revenue was $4.2 mil, so 4 months worth is $1.4m
Fy19 cash flow to date is $9 mil over 6 months, so 8 months worth is around 12 mil.
Thus I estimate total revenue over the period of $13.4 mil.
This is just an estimate and can be wrong because of uneven timings, differences between cash flow and revenue.
So I agree that there is some risk that the milestone will be met, giving rise to some uncertainty now.
Only one month to wait until the end of the period, the company will need to update the market about the options soon after that.
From the last quarterly report, the company said it has secured $14.8 millions contracted revenue for the first half year FY19, It really depends on how the revenue gets recognised for the last 12 months, the new revenue recognition standard has gone alive early last year, I am no accounting/audit expert but I tend to believe that Class B milestones will be met. However, I believe those additional performance shares once issued are subjected to 12 months and 24 months escrow period.
