As we enter April 2022, a month where we receive the Jan to Mar...

As we enter April 2022, a month where we receive the Jan to Mar Quarterly & Activities Report, worth considering how important this quarterly in terms of cash flow.

If we go back to December, many expressed surprise with the need to raise capital. The quarterly revealed a cash balance @ 31 Dec of $ 6.253 m, this including $5.7 m received through the Placement towards the back-end of December. A cash balance of $ 553 K excl the Placement. Talk about cutting it fine.

I have suggested previously that Section 8 of the 4c is terribly flawed. In terms of the last quarterly, Section 8 calculates that given the Cash Balance and applying the Inflow/ Ouflows from the last QTR, should provide 8.2 quarters of cash cover.

This is flawed at the extreme.

This calculation :

- assumes the same level of Cash Receipts shown in the Qtrly ( thats fine, although Nuheara's Cash Receipts have historically been all over the shop)

-the Dec QTR always includes the Annual Govt R& D Rebate, so not repeatable in the other QTRs... $ 1.774 m

- disregards the cash outflow under investing activities, this reflecting that portion of Dev Expenses which are capitalised. Predominantly Employee costs which do get paid monthly. Dec Qtr $ 1.143 m

If you do the maths, current run rate on outflows $5.352m. Let's park the remaining inflows for now, this being the Cash Receipts for the Jan to Mar QTR and the proceeds from the SPP in January ( $1.07 m).

Opening Cash Balance : $ 6.253 m

Adjusted QTRLY Outflows : $ 5.352m

Closing Balance 31 Mar ( excl Inflows) : $0.901 m..... takes us to say end wk 1 April ( this week

Now lets add the inflows for the quarter.

SPP ......$1.07 m

Customer Receipts ....say generously $ 2 m

Suggests we enter April with $ 3.971m of Cash. Would get us to mid May, subject the Customer Receipts number.

So, another CR or are the QTRLY Receipts going to knock our socks off. Maybe a huge reduction in SPEND. A Big Inflow from a Partner organisation. A buy-out . Who knows ? Take yr pick !

This combined with the motive behind the Consolidation will make for a very telling Quarter, all in my opinion of course.

Food for thought. Have a great weekend.

Rokewa