I want to like this company but so far it has just been horrible since listing. They have failed to live up to every forecast with respect to profit. On 25 June 2014 when guiding to a poor FY14 result they said FY15 would be a significant improvement.
Also in the capital raising presentation in Oct 2014 they mentioned a FY16 'target' of $70m and 15% EBITDA margins. Very juicing numbers to get the punters to tip in more cash but I have not seen that 'target' mentioned again.
Now after a H1 15 result that was very poor even after normalising for the Cerno stuff up they are promising 3-4m EBITDA. How can you believe that? And even if delivered they needed a massive one-off hail storm in Brisbane and a category 5 cyclone crossing the coast further south than you would normally see so I doubt it's sustainable.
Now the balance sheet just looks stretched again and I would say a capital raising is needed. I know they are investing for growth but you've got to meet a target or all credibility (and the ability to raise more funds) is gone
SGO Price at posting:
8.1¢ Sentiment: None Disclosure: Not Held
