Ann: Appendix 4C - quarterly, page-15

At first look this was disappointing, the expectation of the psychologically important cash flow positive target has been missed.
Dig in a little and not so bad. In the June 4c estimated cash outflows for Admin & Corporate was 394k, while actual was 843k. LPE indicated the extra one off costs were associated with setting up LEN.
The difference of 449k has been invested in a new line of business that will begin generating revenue on 1/12/17. At this stage we don't know the margins but can reasonably assume they will be as good or better than current electricity retailing at 18%

Further legislative changes have created a position for LPE to again fill a market gap this time in the operation of embedded networks with the requirement for all embedded networks to have an Embedded Network Manager overseeing the core operation of the network.  LPE is poised for this prime opportunity to ensure the existing retail operated networks, other networks and future networks are secure in these requirements.  The company has established a subsidiary entity for this purpose, named Locality Embedded Networks Pty Ltd which will function in a ring-fenced capacity from the Authorised Retailer.  Revenue from this entity will not come into effect until 1 December 2017, it is anticipated to increase opportunity and the profit position of the company into the future

As @djwally points out without this investment, a circa 125k cash flow positive would have shown this quarter. Would we  complain if LPE had self funded conversions from profits, in effect this is a similar capital investment that will generate future income.

Then look at the June 4c estimated cash outflows for Product operating and manufacturing costs at 3140k(electricity purchase costs), while actual is 2646K. Partially explained by the lower network charges, but more so the late September on boarding of new customers who will not have consumed much electricity at end of September. These customers are in the payments cycle now and will show in the next 4c as can be seen in the anticipated electricity purchase costs of 4088k in the December quarter (54% higher consumption)
Going by this expected consumption growth and the new sideline business (LEN) contributing in the December quarter, it will be a very good one. No selling from me.