I’ve been busy today so I haven’t had an opportunity to read...

I’ve been busy today so I haven’t had an opportunity to read through the HC posts. I’m sure much of this one will have been discussed earlier.

Updated charts of quarterly cash flow parameters for AJX are given below. The rapid growth that they demonstrate is just as obvious as for the previous quarter, although whether the latest increases could justifiably be described as ‘unprecedented’ is open to opinion. They do certainly represent record highs.



As described in the report and in earlier communications, the cost effect of the Company’s investment in inventory raw materials in order to meet customer demand is seen in the latest data. This is most obvious in the expansion of working capital, the major component of which is the ‘product manufacturing and operating costs’ item.



The average rates of exponential growth in both cash inflows and outflows are little changed, with the rate for receipts running at more than double that of cash-based costs (which is comforting). Their respective trendlines now cross early in the current quarter, which would align with the Company’s confirmed expectation of reaching a Cash Neutral Position in this 2Q17. This timing is reinforced by a plot of the inflow/outflow ratios.




The trend rate of quarter-on-quarter growth for cash receipts over the last 13 quarters averages 50.7% compounding, which equates to annualised growth of 515%. The reported year to date increase of 682% compared with the previous relevant 12-month period reflects this level of rapid growth.

A discrete figure for quarterly revenue is not given, although it is stated that this “grew 425% over the same period in the prior year”. My estimate (shown on chart below) is that the relevant revenue figure for 1Q16 was $2.38M, so an increase by a factor of 425% would mean 1Q17 revenue was $10.1M as shown (or $12.5M if this was an absolute increase). Around $6M of this amount would have derived from Recurring Revenue.



New Technology Development shows the business remains a mix of both research and commercialisation, which bodes well for expansion into both current and new markets. Onward and upwards.

Cheers
T7