Member Info for Brockwl

Terry you said Best bit for me its only 10% of what the RFQs will be in a few years.

I don't understand why this sort of stuff impresses you.
We known for ages what the eventual addressable market is, and that they predict 50% market share by value.
So why does spinning this some other way impress?
It's 80m cars, which at $10 per car is $400m revenue a year.

So the only things that matter are-

1. Can they achieve that?
2. How long is it going to take? and is the wait worth the eventual return.
3. Can they achieve this without another raise and shareholder dilution?

I'm confident they will achieve 1 above.
Previously I was relatively confident about 2 and 3, and had a rough timeline, of when that might be.
However the last few days has made me question that timeline, and readjust my expectations.
When the cash burn rate is over $30m a year, any revenue delays and cost increases, will likely be the determining factor as to whether long holding shareholders receive a decent return.
For me the next KPI's have now become very important. I'll reserve judgement until then

investormeet will usually put up a recording within a couple of hours.

Easily the worst update I've seen.
He seemed like he didn't want to be there, and very reluctant to get drawn into any speculation after the Italian experience.
Clearly not liking impatient investors.

I'd expected FX rates of AUD dollar to be the reason for poor growth of recurring monitoring revenue, against higher growth of installs.
But good to get an answer.

Soul,
You are correct I have confused the Roth with CMD day. When is the CMD happening, I'm struggling to find this information?

Cheers

Chuzt,

You need to take another look at that research note.
I agree OEM revenue shows a slight increase, but that's only because on the original forecast they miscalculated how much Magna License revenue got booked this year. They have now increased that by 2.3m which gives a slight increase.
What that hides is the other OEM revenue has been adjusted down by 1.7m.
That's because that now only shows 760K units sold this year against their previous 960k forecast.
See cars produced with SEE DMS in the OEM section.

Having read the results and Cenkos update, I’m feeling somewhat confused.
The results were as expected, and mirror the very recent trading update. Only disappointment was the fact they only received 1000 Fleet Gen 2 units in December.
The Cenkos note however was something altogether different, and is probably the cause of the fall.

I mentioned previously that I felt the last note showed they were starting to realise they had been too ambitious with forecasts, and expected they would start to reign in some of their more aggressive component forecasts.
However it seems to me this note has done that and some more.

Key points that stick out for me are:-
1. Reducing their share price target today, when as time goes on it should be increasing.
2. Cenkos financial forecast now show the company failing to make a profit until FY 2026.
3. They have revised down Auto sales this year from 960K to 760K.
They only have 1.51m for 2024, and 4m for 2025, where I was expecting (from various company presentations),
something around 3.2m and 16m.
Those are significant shortfalls.
4. In FY 2024 (the year it’s all supposed to really inflect), Auto OEM revenue barely increases, Any Auto royalty increases,
only barely make up for loss of previous years Licensing and NRE revenue.
5. Constantly increasing capitalised development costs. For example, 2025 has increased from 11.8m to 17.5m
6. They appear confused, (as am I ), regarding how much of the Magna Licensing revenue is to be shown in the
accounts this year. However, they now appear to think it’s more than the $5.8m their last forecast showed, and now
show $8.1m.
No idea if the $8.1 is all Magna, or Magna and other licence stuff.

Revenues delayed and costs going up, is a fact of life with all high growth Jam tomorrow stocks, but I thought we had reached a point where that was starting to recede.
If current Cenkos forecasts are to be believed, then we still have a significant wait, for share price appreciation, based on what they know, failing another significant announcement.
All very depressing really, just when I thought we had turned a corner.

On another note, the latest update re this week’s presentation to US II’s isn’t quite what I was expecting.
Basically, it's a number of one to one chats and meetings with various interested II's mostly today, and possibly tomorrow.
I’m beginning to have serious doubts any Italian Job announcement is coming this week, where I was previously, quite hopeful.

S2020,
I think you see me as negative, whereas I just see me as trying to put some of the hype into perspective.
The Magna deal, was fantastic, and in my opinion the best RNS we have ever released.
However I'm not sure that it shows Magna to be supremely confident.
The 3 year licence is really a 6 year licence, as See can't do anything before it finishes and if they wanted to release in another companies mirror immediately after, it would probably be another 3 years before any hit the road.
So Magna have a clear road for 6 years.
If as Paul says it will become 50% of the total market, and in 6 years time the market is 80m cars, thats 40m cars to them.
If we assume they make $10 profit per mirror, and I'd bet its actually a fair bit above that, in 2028 thats $400m in one year alone.
If its $20 thats 800m.
The previous 5 years will have seen decent profits as well.
So actually from Magna's perspective $17.5m was a drop in the ocean to keep us sweet, remove the competition and win that business.
If it turns out not to be anything as good as that, they will still easily get their money back .
So it was more of a business no-brainer, ie a bet that couldn't lose, rather than them being very confident, but taking a risk.
That was actually a good thing for us, as we got a cracking deal when we needed it, and should be the making of the company

Seepee,
Look at the last KPIs published in the recent Trading statement RNS.
Then below the cars on road row which has your 700k figure, there is a production figure for each quarter.
Q1 2023 was 112077 and Q2 was 141747. So adding those 2 together we get 253824 for the 6 months this Financial year.

This is the key number that needs to keep increasing Quarter on Quarter.
So to hit the 1m this year we need to do another 746176 in the remaining 6 months.

I incorrectly said 141k in last 6 months, when I meant in last quarter.

S2020,
Not sure what point you are making.
No one is saying its only 1.75m over the next 3 years.

Seepee,
You need to read the KPI's again.
Its 141K this 6 months,.
500K is the all time figure including previous years, so is pretty much irrelevant, but the company keep displaying this, hoping less tuned in investors are impressed..
This has been discussed numerous times before.

Seepee,
Your missing the point.
We are talking number of cars per year.
Not total number of cars from year dot. That's a meaningless number, as once we have sold we have been paid.
Revenue is all about new installs. So for this to multibag we need to see big increases year on year.

Matml74,
Not CY 2023, Financial year 2023.
My reading of the chart was 1m.
Cenkos are forecasting 960k.
For the following FY year 2024 I have 3.2m from chart.
Cenkos are forecasting 2.93m

Terry,
I think you are going to have to wait a bit longer for a Fleet ramp up.
Jan and Feb mileage numbers have been poor.
Now although that is typical based on previous years, they have usually got back to the December highs by late February.
However this time they haven't.
It's possible some mileage isn't getting recorded (Decembers KPIs were better than mileage suggested), however even taking that into account its still low, suggesting no increase in Fleet.

Ok well I see that as big news.
After the last KPI numbers were released for Auto, I was a little underwhelmed.
This was on the basis that reaching the 1m a year mark this year was going to be challenging, given the next 2 quarters would need to see a 75% compounded increase for each of the final 2 quarters.
However Ford had been contributing around 6000 per month to the last Quarter KPI.
Based on those figures (increase of 72000, in 2 months), they will now be adding an extra 30,000 per month to the KPI.
(72,000/2) -6000 = 30,000 per month.
So assuming next quarters KPI is at least the same from all the other OEMs, that adds 90K to the total.
I make that a 63.5% increase from Ford alone.
141,747 + 90,000 = 231747

Given I'd expect the other OEMs to also be increasing and new OEMs/Models coming to the party, the 75% increase needed isn't such a stretch.

Hopefully I've worked that all out correctly.

Terry,
Where did you get those month end blue cruise figures from, as they are very relevant?
It's not from the link you supplied.
Cheers

Lewbo,
That's bang on. I reckon you still have a copy :-)

I thought he said that they seriously considered listing about 18 months ago, but was glad they didn't now as it would have taken up far too much senior management time.
I think he later said if they get to end 2024 without getting taken out, that would be the time to list.

I consider myself very fortunate to have seen it before the video got taken down.
Its actually a shame that they couldn’t just release the first half of that Video, where no sensitive information was discussed, as it gave a fascinating insight of Paul’s background, time engaging with the company and what he found/did when he took over.
For those who didn’t see it, there were masses of positives, which have been well covered by others.
So for the semblance of balance I’ll cover the few negatives.

Having spent a day reflecting on things, what sticks out to me is what would likely have happened if Paul hadn’t joined.
Him joining was a close run thing, as having offered him the job once, after a very exhausting interview process, they employed a new chairman and then knocked him back. At that point he actually told them never to ring him again.
6 months later they came back asking if he would fix Fleet in a project management consultant role.
Lucky for us he was available and said yes, and later went on to become CEO.

From listening to the video, I’m fairly sure this company wouldn’t be anywhere near where it is today. It would probably be just another tech company with a fantastic product, which never got the traction needed, and keep coming back for more and more money, and massive dilution.
I suspect everyone heavily invested here would have been wiped out, or at best got out about even if they sold out, rather than keep trying to make it work commercially,
Hence why it is so important to continually question the financials, and strategy.

On that note he said 3 things which haven’t been mentioned.
1. The company is currently burning cash at a rate of 3.3m a month, and expect that to continue for another year. At that point it should start to narrow and profitability was again confirmed for 2024.
2. They have employed 100 extra engineers.
3. The Magna collaboration, had and continues to save a huge amount of costs in working together and sharing/using Magna’s engineering capability.

So clearly for 3.3m a month to continue for a year, it suggests that costs are still rising at an equal rate to any revenue growth.
100 extra engineers at $30,000 is $3m a year extra cost.
I’m guessing at $30,000, could be more or less.
Without Magna colaboration, costs would have been higher.
What all this says to me is just how hard it is to get this right, and do it in a way shareholders benefit.
I don’t think we could have anyone better than Paul in charge, and I am now more convinced we will make it. But I think a lot on here underestimate, how easy it is to let costs escalate, and mess this up.
Consequently, I’ll be monitoring costs against revenue growth, ever closely over the next 18 months.

I also suspect when they talk about being profitable in 2024, that doesn’t include the R + D expense they currently capitalise. So, there is at least another 10m to make up, before I class them as profitable.

GLA

yes

Baxter - YES you have