BGO1 Jan 2020 20:38
You lot are certifiably insane lol.
This is going to completely collapse imo.
Best you read this.
Stockopedia is showing forecast revenue of £11.9m, so actual revs of £9.3m is a 22% miss - not good at all, coming so close to year end.
Note that interim revenues were £4.32m (up 64% on H1 LY). FY revs of £9.3m would mean H1 to H2 sequential growth of only about 15%. That doesn't tie in at all well with the talk of exponentially rising revenues.
Profit miss - this is a big miss, as gross margin is high. Adj EBITDA forecast drops from £2.3m to £0.4m. I'm becoming increasing surprised that the share price is only down 8% in response to a big miss.
The company is capitalising around £2m p.a. of costs into intangible assets, so the EBITDA number does not translate into a proxy for cashflow. Although, tax credits are an important contributor to cashflow - the last balance sheet (interim) shows just over £1m sitting in receivables, due from the taxman. The new Govt recently announced its intention of making this scheme even more generous.
In a separate announcement, it turns out that R&D tax credits have been wrongly accounted for by the Govt, for years, and that the annual deficits were actually quite a bit bigger than previously reported.
Adjusted PBT for FY 12/2019 has been revised down from £0, to -£2.0m. But remember to allow for the positive impact of R&D tax credits - arguably we should use PAT not PBT as the benchmark for companies which claim tax credits in this way - as it's a bona fide contribution towards cashflow.
Forecasts for 2020 have also been slashed today - which doesn't make sense to me, if the problem is a contract slipping from 2019 to 2020 - surely that would mean 2019 forecast figures are cut, and 2020 forecast profit should actually be increased?
Adj PBT for 2020 forecast drops from £2.7m to £0.9m.
Cash - has improved in the last 6 months, probably due to receipt of tax credits;
Cash has increased from the end of 1H 2019 and will be at least £2.5m at the end of 2019.
Strategy Day - is being held on 29 Jan 2020. These meetings can often be a precursor to a placing. Bango looks as if it could benefit from a smallish top-up placing, to give it more headroom. So I would imagine that a £5-10m placing is possibly on the cards? With a market cap of £88m, that's not much dilution, so isn't a major concern.
You have to remember that big name customers expect their key suppliers to be well financed.
My opinion - I feel that the bullish commentary today doesn't quite match up with the sharply reduced forecasts. Maybe the PRs were allowed a bit too much leeway, given the time of year?!
If this company does manage to produce exponential growth, at high gross margins, as it talks about, then the shares could do very well indeed. The figures today put a question mark over how realistic that is. It looks to me as if the growth rate is slowing, at least for now.
Overall then, I can see the potential h
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