Not much to contribute in regards to FANG at present, but I still think this potential channel could present enormous leverage at the right time. I just don't think that time is now imv. Why? Because as the 4c has shown, they still have quite a bit of work to achieve prior to venturing off across other channels, but the potential to do so is there. I want to see management get this company to break-even first and they're almost there, even with the challenges they've been presented with. Whilst sales didn't improve, a couple of positives for me whilst they iron out the challenges...
* Cash receipts are still stable at $1,229,000 (December 2018) compared to $1,229,000 (September 2018);
* They've have put cost cutting measures in place as evident by the reduction in cash burn. They're sitting at only a negative cash flow of $218k (December 2018) compared to $455k (September 2018). That's good.
* Average commission of $33.31k per sale was not much, but a good improvement in the bigger picture as sales hopefully pick up. That's an improvement against Q1 FY19 of $32.45k per sale.
* 18 active reservations at the end of Q2 FY19. That's great imv. They just need for the sales team to convert those active reservations to sales.
* More cost cutting measures in place. The company highlighted "The majority of the savings will be made by divesting of assets and business units across the Group which are not performing.”
* The Company’s future gross commissions receivable book is valued at circa $5.10m at 31 December 2018 (subject to settlement). That's starting to trickle through.
* Just over a $2m market cap and the top 20 shareholders still appear to be holding strong.
* Oh and the other interesting point for me has been Copulos buying heaps at these low levels.
Anyway, I'm loaded to the max at these levels, as if/when this turns from negative cash flow to positive cash flow and then profitability, these levels won't be seen again.
Here's hoping lol!
Tony
IBN Price at posting:
0.2¢ Sentiment: Buy Disclosure: Held
