Ann: APPENDIX 4E AND PRELIMINARY FINAL REPORT, page-12

Groberts, I think that you might have missed one salient point. In the last of your fours points:

• Aug 2017 - It also should be noted that the associated negative impact on gross margin is significant and, given the low level of overheads attributed to this business, the impact on profit is greater - 4E Report

I think the point that the company was trying to make was that with approx $560k margin being generated from the OEM business (my estimate) the loss of this business immediately plunges the business into negative margin and possibly negative cash flow. Overheads are not reduced with this business going, in fact, overheads are likely to increase. We have already seen an increase in advertising and marketing expenditure, and people costs as the company tries to support the ARDO range and take a higher profile with some of their products.
They might be able to make up the lost gross margin (I say "might" because Ellis has made the point that there is a lot of price pressure in the market) but it is unlikely that this will flow through to the bottom line any time soon. Given that a significant proportion of the increase in cash has come from reductions in working capital (primarily inventory) my guess is that this is unlikely to be repeated.
What we are likely to see IMHO, at least for the next financial year, is EBITDA break-even and a reduction in cash of a couple of hundred thousand dollars. This will make it hard for the business to look at any acquisitions (although they are always talking about them) and the business will go nowhere.
In the absence of a better offer, 8.6c is probably not too bad, although we would all like to see better.

DYOR, IMHO, etc, etc