More boxes being ticked. Maybe after the dust has settled down with the nervous sells she may head north again and again.
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More boxes being ticked. Maybe after the dust has settled down with the nervous sells she may head north again and again.
This is bigger news than the latest 'contracts' news. Tbis is one step I wanted to see. Exciting times ahead and I hope NZ investors, invest for the longer term, on this while they still can at these sub-$2 levels
Never rains but it pours:
https://nzx.com/companies/WYN/announcements/273520
I like the rain. ;)
Clearly management have had a mandate to pump the share price up, and so far this stream of news is achieving this goal. But we must dig deeper.
On the surface everything looks great, however we need to remember that their FY15 revenue guidance back in May was $40 to $45 million. Their 1H15 result was $14 million, this means for the 2H they need to generate $26-31 million.
It appears that they are announcing any significant deals around the $1M+ mark. When they can’t disclose the party they simply don’t release any information about them, so we can assume they are releasing all significant deals to the market.
So far since 1H15 result we have had announced deals worth only $11.1 million. A huge shortfall on their guidance. With only 6 weeks left in their financial year they must win many more deals to meet guidance.
Perhaps they are reporting only 1/3 of their deals, but why? They also have reaffirmed the $40-45M a few times since May, so we can be sure it’s not going to be over this, we can also expect expenses to sky rocket for FY15. If they miss guidance the market will punish them, as FY14 result was not impressive.
I’m just playing devils advocate, because with all the hype one can forget about the fundamentals.
Good post there, Thor
Good points Thor. I do wonder - are there levels of disclosure whereby they do not release anything to market, at request of the client? I can understand why a client would ask them not to release anything sometimes - any client information could potentially tip off people about products they are using to try and detect fraud, thereby giving information to fraudsters that they can use to evade detection. It would be dependent on the client - for instance " a major internet search company " would just be double speak for google, most likely. "A major NZ bank" can be narrowed down to 4 quite easily, if 2 already have the product then the its a 50% chance. This could be the reason they are under reporting their deals though. They also may have many small sales for their cheaper products. For instance their fraud analytics software is probably quite cheap and 500 sales of these at say 10k each (am guessing at pricing and numbers) isn't going to trigger an announcement, but will add to the revenue figure significantly.
The cash burn might step up to what? 20m a year next year? Nothing to worry about though if you have some major backers! (maybe :-S) Particularly if they are keen to see 80% growth (a-laa Xero). With Xero seemingly on a profit trajectory (or maybe just taking a breather), profitability might not be as far away as people think.
For Wynyard, its a different kettle of fish. Their products get more and more compelling the more people they sell to and the more crime is detected. A slow but more effective sales strategy.
Remember that all these deals are a mix of one off and recurring revenue, same goes for those in the past. They're not a whaling ship, they will still be receiving revenue from past deals, and will only be realizing a portion of the announced deals. Given they have re-affirmed guidance a bunch of times, I can only assume they're not announcing a bunch of smaller, boring, revenue streams.
Hmmm...call me cynical but these announcements of late makes you think that there is bit of push to romp up the sp in light upcoming private placement.
Agree with your views there Thor. While these announcements are positive, you can't help but be bit sceptical re the timing. Mind you the contracts are worth over a period of few year not just for this FY.
I dont think that is clear at all. The mandate would seem to be to get the word out internationally how good their products are with further capital investment in mind. They have achieved that. Investors have responded and the market has reacted accordingly. The recent significant shareprice rise is simply a very welcome by-product of a wider realisation of what WYN are all about.