quarterly now out, page-5

Here's the reason why it looks good in my view using some rough maths:

Last qtr SHP pulled in $700K total revenue. Since OHKI and EziDirect only came online under SHP at the time and without knowing the split betw advertising and shopping, let's assume last qtr was 80%-20% or $560K-$140K split.

This qtr SHP reported 29% drop in advertising revenue = $398K, which means shopping had $(780K-447K) = $382K. If this represents 159% growth, last qtr's shopping revenue would have been around $147K (close enough to the $140K estimate earlier).

Assuming 3 months of revenue from:
- OHKI - $90K (based on historical figure disclosed in acquisition announcement on 13 May);
- EzyDirect - $113K (again using historical figure disclosed in acquisition announcement on 22 April).

One would then estimate Eljo to have contributed roughly $179K this qtr. Considering there's only been maybe 4 wks of trading since re-launch in Nov, this is more or less in line with the company's aim of achieving $250K/mth within 6 mths. Even better if OHKI/EzyDirect (smaller siblings) did contribute a little less, which could only mean that re-launch of Eljo (big brother amongst the 3 sites) has already met or exceeded the company's targets.

The decline in advertising revenue (Footar as the main product) to me wasn't a surprise - people generally tend to gravitate more to the top of a web page than the bottom.

On a positive note, the company has reiterated that an acquisition or two is still on the cards, so some of the lazy cash from recent placement can be put into work and grow revenue further.

All in all, the numbers are largely on track with what was expected. To me this is a growth story with foundations now established, and more bolt-ons will kick off this growth. Don't forget SHP's revenue/MC ratio is still relatively low comparing to other listed players in the online space, so re-rating is a matter of time (hopefully soon).

I think now is the time to make a move before rest of the market eventually catches up.

Let's see if rest of the world shares the same view when the market opens tomorrow.