Know this when reading FLC ann's

Margins.

Big contract wins in ASX announcements may sound amazing at first, but understanding what it means to the bottom line of FLC's P&L is the difference between why some investors will buy and other will wait or sell into any strength.

Take the Africa US$100m MOU ... I have a feeling that some bought on this announcement based on the US$100m headline figure.

What I suggest is that all shareholders of FLC should memorise the margins for FLC's products i.e.

Large projects e.g. Africa = 15%
Nirobox = 25%
MABR = 35%+
SUBRE = 50%+

So a US$100m large project actually means US$15m gross margin, which is actually the same as a US$25-30m SUBRE contract @50%+.

In fact Large projects are likely to stretch over a year, which means revenue/profits will be recognised over multiple financial years (and prone to delays).

Nirobox is RWL's main selling product, and that is what has been growing 20-30% year on year. MABR and SUBRE are the new products that will drive FLC into profitability.

So when I read FLC announcements, I am very much interested in MABR and SUBRE contracts .. which is what is being pitched into the Chinese market... this is where the exponential growth will come and where our margins are greatest.

Good luck and I'd appreciate thoughts/comments from other posters