"This would result in annual customer recipts of approx $9 million. "
9 million certainly sounds too low for me - or are you counting only the customer receipts from new SME clients due to the paywall introduction?
half year dec12 customer receipts have been 5.3m without the benefit of the paywall. While h2 receipts have been weaker historically, i expect an annual run rate of revenues and annual cash receipts from customers from the base enterprise business only in a steady state scenario (no further signups, no customer defections) of around 10 million currently.
In addition to that, the company has announced AT LEAST 3.3m in annual revenue/ cash receipts due to the paywall.
So, without the benefit of further customer signups, assuming they keep their record of close to 100pc renewals, NEA looks to be right at the breakeven point.
10m + 3.3m revenue versus 14m annual expenses (my estimate)
(When looking at annual figures in a steady state scenario, CF and revenue should be the same. This is why i have used both interchangably above)
NEA Price at posting:
28.5¢ Sentiment: Hold Disclosure: Held
