Ann: Major Managed Service Contract Win, page-9

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mwap

159 Posts.

16/01/18

11:44

Post #: 30336770
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Originally posted by afterlife ↑

> Jim Morrison < i appreciate your concern as to how profitable these managed service contract will be.
particularly with the highly competitive bidding environment, one may think that IT comp may reduce profits just to get a hot meal ( a contract).

this is why RXP and DWS is moving into a higher margin DIGITAL services. they also enjoy a much higher
EBITDA and PROFIT margin. never the less NONE of these two companies has such a tremendous revenue growth as CNW.

I had a look at CNW presentation from September 2015 Boasting about the 15 mil revenue achieved for the FY 2015. 3 years later CNW is expecting 86 mil revenue for the full year , these numbers are staggering
from 15 to 86 millions in 3 years , they are building scale and a large foundation operating now in 3 cities/regions that are diverse in their needs and offerings , WA mining related, VIC finance and day to day industries Canberra government-related contracts.

DWS archives 20% EBITDA margins , RXP around 15% ( was 11.5% ) and EPD around 8% ( from memory)
IF CNW has a 4% to 5% EBITDA margins than for FY18 we are looking at around 4 mil EBITDA.
As the company build scale and manages to improve margins the bottom line numbers escalate in a double manner.
eg. FY19 REVENUE 100 mil on 6% to 7% = 6.5 mil EBITDA
FY 20 REVENUE 125 mil on 8% to 9% = 10.6 mil EBITDA
These are three years of 50% potential increament in EBITDA year on year.
It's only an Estimate. and many facts can and will change.

For me, CNW is not an overnight success story but rather a long and steady GROWTH STORY in a competitive ICT environment, there are many players as there are billions of dollars to be spent in this utility/ growth industry

Currently, i am in for the long happy journey, buying on deeps and looking forward to 3 or 4 years time to be getting DIV on shares we have bought on the cheap.

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I agree have the same plan - looking forward 3-4 years when hopefully div 's start to arrive - just 1c will do!!!

CNW Price at posting: 1.9¢ Sentiment: Buy Disclosure: Held
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Ann: Major Managed Service Contract Win, page-9

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