PEB - Pacific Edge Ltd

[Balance]

A company like PEB burning through cash and with no indication whatsoever of when it will turn a profit or cash flow positive needs to have cash on hand at all times to at least last the year ahead.

PEB burned through $17m of cash last financial year and it appears cash burn will continue to be high to support the full 'commercialization' infrastructure.

Cash at $24.6m at balance date means PEB could be back to the market for more capital in between 6 to 9 months.

[Snow Leopard]

... shocked at the size in the increase in expenses, but I will have a proper dive into the detail later...

See note 7 & 17.

You may recall last year that $500,000 went on the expenses for compensation from the delayed announcement of price sensitive data.
So remove that from last years expenses.

Now this year they have a reversal (credit) of $135,016 in the expenses because 'this portion of the accural [sic] was not required'.
So add that into this years expenses.

And, unfortunately, I have just increased the Year on Year expense difference by $635,016.



Best Wishes
Paper Tiger

[Snow Leopard]

Here is the worry.

Expenses of $23M produces revenue of $5m
+ grant income which ends soon,
+ interest on the massive cash reserves that you will not need if you can make money,
+ exchange rate gains which can go either way.

So to be crude let us divide the $23m up as:
$21m fixed:
all that R&D that you must keep up to stay in the game;
salaries including the mega-dollars for the top management;
keeping the S&M department on the road;
etc.
$2m variable but directly related to revenue. A gross profit margin of 60%.

Using the magic formula R * 0.6 = $21m gives

R = $35m

or $35m of revenue enables breakeven on $21m fixed + $14m variable.

There you go, sweet and simple, and probably not totally accurate, but the Tiger's survival instincts say not too far out.

PEB need to hit the equivalent sales rate of $35m per annum (or $3m per month) before the cash runs out.

They have two years.

Best Wishes
Paper Tiger

Disc: DYOR, but you can start from here.

[Minerbarejet]

Probably right PT.
However.
Grant income may continue as there was an indication that after the three years were up it would be reviewed.
Pretty much the whole basis of revenue is from Detect.
Triage has not kicked in much yet.
Monitor has not kicked in any yet.
VA is not included in the latest figures.
Tolmar contributes nothing yet.
Nor does Oryzon but they were waiting for Monitor I think.
CMS with its big backlog of unpaid bills doesnt help cashflow
KP is still on the cards for this year.
Colorectal cancer screening part of health budget this year
Good time to release cxcolorectal prognosis, yes?
Two years sounds about right. Will still have a year up its sleeve for 100mil

You worry too much for someone who doesnt have any PEBs

[kiwidollabill]

http://www.odt.co.nz/news/business/3...losses-concern

Pacific Edge chief executive David Darling said he expected "cash burn'' for full-year 2017 would be "largely in line'' with the past year.

While not providing any near-term financial guidance, Mr Darling reiterated Pacific Edge remained committed to achieving its $100million revenue target by full-year 2019.

[Apathy]

http://www.odt.co.nz/news/business/3...losses-concern

Pacific Edge chief executive David Darling said he expected "cash burn'' for full-year 2017 would be "largely in line'' with the past year.

While not providing any near-term financial guidance, Mr Darling reiterated Pacific Edge remained committed to achieving its $100million revenue target by full-year 2019.

I expect to buy a winning lotto ticket some time during 2017 and remain committed to marrying a super model by end 2019. My odds are somewhat better than Darlings.

[Snow Leopard]

I expect to buy a winning lotto ticket some time during 2017 and remain committed to marrying a super model by end 2019. My odds are somewhat better than Darlings.

So you want to have your own Darling, how sweet!

Best Wishes
Paper Tiger

[Snow Leopard]

Probably right PT.
However.
Grant income may continue as there was an indication that after the three years were up it would be reviewed.
Pretty much the whole basis of revenue is from Detect.
Triage has not kicked in much yet.
Monitor has not kicked in any yet.
VA is not included in the latest figures.
Tolmar contributes nothing yet.
Nor does Oryzon but they were waiting for Monitor I think.
CMS with its big backlog of unpaid bills doesnt help cashflow
KP is still on the cards for this year.
Colorectal cancer screening part of health budget this year
Good time to release cxcolorectal prognosis, yes?
Two years sounds about right. Will still have a year up its sleeve for 100mil

You worry too much for someone who doesnt have any PEBs

Your statement about Tolmar is incorrect (Presentation slide 4)
The rest we wait patiently, see how the above and more unfurls and keep modifying our highly accurate most likely future scenario model (aka guess) to be even more accurate.

Best Wishes
Paper Tiger

Sydney or the Bush !

[Harvey Specter]

While not providing any near-term financial guidance, Mr Darling reiterated Pacific Edge remained committed to achieving its $100million revenue target by full-year 2019.

Committed or needs to be committed - that is an insane amount of growth.

Not that it makes much difference but is the $100m in a financial year or cumulative? I assume it is annual.

[Lewylewylewy]

Committed or needs to be committed - that is an insane amount of growth.

Not that it makes much difference but is the $100m in a financial year or cumulative? I assume it is annual.

Whenever I read about PEB's speculations, I always think of when Dr Evil from Austin Powers was asked how much to charge for ransoming the world. "One millllion dollars! hahahahaha! ...Oh, one million isn't very much now? Well.... 100 million dollars!?"

Numbers...