The Figures and the Triggers

HELPme get my head around this beast. Ive done some rough calcs on the back of my famous napkin with a few red wine stains in the corner :

• LVT averages around 40 customers per quarter so 160 a year which 1 every 2 and 1/4 days.
• Average Spend new per customer in last 6 months Is 116k – 73 new customers adding 8.5m in ARR ( 5.6+2.9). Due to how figures are reported I don’t know how many existing customers exited, reduced or increased their spend but im going to work off the most recent average of $116k+10% say 130k
• So im expecting 160 new customers per year adding 160*$130k =$20.8m or 5.2m per quarter
• However to reach a target of 100m by June 21 they have 7 quarters to get 57.1m which is a tad over 8m a quarter.
• If they achieve that the share price should be worth $1-$1.20 based on 8* and 10* ARR as ARR is 100m*8 = *800M/800k shares = $1
• My calcs at $130k per customer @ 40 a ¼ only get $5.2 per quarter which is $2.8m per quarter under the target ARR.
• So to get $8m per quarter we will need the average of 40 new customers spending $200k ( which is 85% increase on last 2 quarters average spend ) or 60 customers ( 50% increase on average customer numbers last couple of years )spending around $130k per quarter $7.8m or a combination of both.
• I think they will need to increase spending to get there – I cant see it any other way – can you ?
• Currently they spend $16m per quarter to get 40 new customers ( and loo after current)so $400k a customer whom add an average of say $130k per year for 10 years so $1.3m ( average yearly spend would increase overtime as well). I cant see how they can increase customer and market share with greater spend. I may be wrong happy to be corrected
• An extra $4m per quarter would add say 10 extra customers as a hard line but as most costs are fixed then id say you would get 20 as your COA should decrease im guessing ( could be wrong). So they can get 60 customers a ¼ ( increase of 20) ARR will increase by 80*$130k = $2.6m per quarter at a cost of $4m per quarter so breakeven would be pushed out a few years for a greater ARR and increased chance of another raise

If theygrow at the target rate of $8m per quarter ( last 2 quarter half that onaverage )which is $32m per year then in 5 years ARR should be $200m , valueingLVT at 10* @ $2B and therefore the shares around $2-$2.50. This is a nice %gain for sure but fairly risky. The other point to note is that $130m ARR = 1%of the market so at current growth they would only capture another 1.25% of theestimated market in 5 years. This seems a long period of time to capture what canbe a changing market. So to capture more of the market LVT need to add morecustomer per year and the spend per customer needs to be greater.

• My figures say 2 years from now ARR would be $42.9m+(2*20.8) = $84.5m ( without greater spend)

Help me ifim going nuts but I think the cap raise is to increase customer growth numberswhich has been flat for 2 years at 40 a quarter , sure av spend has increasedand the bigger fish is what we a chasing but last quarter we hooked fewer fishand they were a more than a tad smaller.

Anyway ivethrown the bait out there , need some bites to work out if am I reeling in thebig one or another tiddler !