Have been building a forecast model around SNS to give some...

Have been building a forecast model around SNS to give some insight on what levels of sales would be necessary to hit cash breakeven and then J curve from there.

My broad numbers are as follows and would appreciate any additional thoughts / comments on these:

1. Have assumed that the ongoing GP margin remains relatively constant at 63% to 65%. It seems that all sales have an average 37% "cost" element attached so far, but there may be some "at the margin" efficiency gains as we move forward with larger sales, so have some creep downwards in average costs to 35% by FY24.
2. For FY22, have assumed "Consulting & Professional" costs of approx $2m for the first quarter reflect the current cost run rate (so $8m for FY22). Thereafter have inflated by 12% per annum to reflect some new hires, but am assuming that the current team is "good" for the expected near term growth.
3. Have assumed the 1st quarter "Admin & Corp" costs of $1.2m included some one off items and is not the new run rate, so have adjusted down and assumed FY22 costs for this line item at $3.7m.
4. Have assumed sales at their indicated $11m for FY22.

The above then delivers an outcome for FY22 of -$5.0m.

The real question is what is the sales growth from here (and would be very interested in carious opinions on this). They have advised a doubling of sales from $5.5m to $11m this FY. Pace of sales is increasing and so market potential is also increasing with these sales ("if this tech was good for Chicago, then should be good for us"). So I am assuming that FY23 should double again to $22m and FY24 increase by 60% to $35m.

These outcomes would then see a possible cash profit of approx $1.5m in FY23, growing to almost $7m by FY24. These figures would materially increase with higher sales (I would estimate that at least $0.55 in every $ of additional sales would drop to the bottom line).

Thoughts and comments?