I've posted this one before and will so again as I think it's...

I've posted this one before and will so again as I think it's now more relevant than before given some misinformation I've seen around the expected break even point for WZR. At this stage they are still building and building quickly towards being cash flow positive.

This report had forecast 85m of loans written by the EOFY, at the end of January when the website was last updated the company had 74m in loans written so they added around $6m to the book during probably the quietest month of the year. Early this month they launched an advertising campaign which appears to have been received very well. This should set them up to be in a position to push the loans written this Q to around 30m and pushing the overall book up to around 100m with another Q yet to play out in the FY. Well above the base forecasts.


The significance of this is that at around the 100m mark on the loan book the company should be breaking even, from here they quite quickly transition to a cash flow positive operation. IMO they are on track to do this between the March and June quarters, depending on the impact of their advertising they may even do it earlier.


"The Company is currently evaluating several commercial transactions, which have the potential to support near-term cash flow for operations"

This line from today's announcement to me is not a negative. Keep in mind the largest shareholder in WZR is Adcock, Adcock is an entity associated with John Nantes. I would not expect that they will be talking here about dilution when the pathway to profit is clear as day. Instead my assumption is that they will be looking to increase their on balance sheet loan capacity. They make around 2% on loans they on sell but can make more on loans they keep retain themselves. While there is a trade off on risk they have proven that their client section minimises the risk associated with defaults. IMO the commercial transactions mentioned will be non diluting, more than likely value adding.

http://adcockprivateequity.com/team/john-nantes/

https://wisrau.blob.core.windows.net/public/website/WZRAX_DM1_AX_Wizr_RaaS_Report_2018_PUBLISHED.pdf