BLT - Blis Technologies

[winner69]

Hell's bell. Is this bad news just as things were looking honky dory

https://www.nzx.com/files/attachments/253259.pdf

They say underlying demand is unaffected - just a timing issue

But hope the new owners don't decide to do a range review ......and throw Blis out

[GR8DAY]

.........probably (and hopefully) best described as a "minor hiccup." Someone pass me the BLIS please.

[simla]

Guess we have to wait until about May for an update on what this means. Yes, first piece of disappointing news in a while. Possibly new client owners hunkering down for the increasingly interesting world economy rather than any change in the customer point of view. Or maybe just a typical purchase of a company being followed by a withdrawal of cash from the purchased company - completely unrelated to Blis therefore?

Neverthless the lack of growth in revenue during this financial year has been puzzling. Was the Q1 revenue of 1.9m (presentation agm) in fact stock build up rather than underlying demand, and hence a false impression maybe? And is that what is being reversed out in this announcement maybe even?

Hence my interest in knowing how much is repeat orders. I notice they almost refer to that themselves this time: "It is important to note that the changes do not reflect any change in underlying customer demand". Well good that there is an underlying repeat order base but it would be helpful for us to know how much of that is what the revenue is - 20%, 40%, 60%, 80% - as that would allow us to judge how much the revenue can swing in good and bad years maybe?

On the better news front (maybe) does "instead reflect changes in timing of purchases by these customers" mean that the orders are still there but will be booked next year?

Well, it doesn't sounds awfully bad to me, life goes on. I remain cautious but hopeful.

[jonu]

Substantial order at 4.2.
Wonder if it is a backstop that will evaporate.

[jonu]

Substantial order at 4.2.
Wonder if it is a backstop that will evaporate.

Hmmm...Sure enough ...Goneburger

[Leftfield]

Putting things into perspective. Trading Revenue to 31/3/16 was $5.6 mill. This revised forecast to 31/3/17 is $6.5 mill. An increase of 17.8% which is not bad.

However, much now depends on controlling costs to meet their reduced revenue expectations.

[simla]

No, I think this does deserve thought.

March 14 - 0.5 million revenue
Sept 14 - 1.1 million revenue
March 15 - 1.4 million revenue
Sept 15 - 2.7 million revenue
March 16 - 2.9 million revenue
Sept 16 - 3.8 million revenue
March 17 - revenue predicted to be at least 4.2 million (based on full year forecast given a few months ago)
March 17 - now 2.7 .

Suddenly the trend is 1.4, 2.7, 2.9, 3.8, 2.7. Not so stellar. In fact, if we guessed that the 3.8 half had 1m of stocking up on new products (as perhaps indicated by the latest announcement showing 1.5m order cut backs to reduce stocking levels at 3 companies), then nearly flat for two years possibly?

Since we know that NZ sales have advanced nicely year after year, and that therefore it sells well, then the question must be why is it not so elsewhere? Simple answer: the big revenue growth has perhaps been new markets and new products stocking up and not repeat orders growing? If so, then repeat orders should build after the initial stock has worn in assuming customers like it.

The shortage of news from the company over the last couple of years could now be viewed as possibly that there was not a lot of good news to share?? I notice that they do not seem keen on giving out disappointing news (maybe there was none), but maybe things go better when all the cards are on the table.

I agree with many posters here that the potential is excellent. But the company needs to tell us what the situation is with underlying demand so that shareholder expectations are not getting ahead of reality. In my view anyway. An alternative explanation is that overseas demand is not growing especially rapidly in which case we also need to know.

I remain cautious but hopeful. It is a great product and experience shows that there can be excellent demand. But it is time the company gave us some back story on the revenue instead of just publishing total revenue without explanation of its makeup. For example, Asian sales went from 241k in 2015 to 753k in 2016 - a 300% increase in one year - and then 936k in the next 6 months, another 250% pa. increase in just 6 months. Yet this remarkable growth was not even commented on in the reports. Why not??

I know people think I am being negative lately, but the company has moved to cashflow positive. We should now be leaving behind our startup wild hopes phase and starting to look in more detail at each report as for any other company. The revenue expectations of the company have not increased since April last year, and are now reduced instead. I think the company should provide a commentary on that at the earliest opportunity. Hard to see the share price going anywhere before they do.

I remain relatively upbeat since the product is good and the markets are open. But I remain cautious too. There is no doubt that sales revenue in the last 12 months has not grown much. Why?

[simla]

However, much now depends on controlling costs to meet their reduced revenue expectations.

Yes, certainly. Let's hope that they explain that their revenue expectations for next year are not reduced.

[simla]

Also perhaps worth noting in the announcement : " The tax asset will be recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised and that shareholder continuity requirements are met. Accordingly, a tax asset of approximately $1.3m is expected to be recognised." https://www.nzx.com/companies/BLT/announcements/297031

1.3m tax is surely only about 4.5m "future taxable profits"? They seem to be feeling cautious too. Or maybe there is an issue in the shareholder continuity requirements - quite likely given the passage of time?

Maybe the company should find a keen outsider to proof read their announcements so that they can include answers to the questions implied by what they have written!

[simla]

If times are proving tougher than hoped, then every bit of experience counts. I really don't understand why they didn't add Barry to the Board when he stood down, for a while at least. If you compare the 2009 and 2016 annual reports, there has been a big loss of institutional knowledge: 4 out of 6 directors are new since 2009 and two 2009 directors gone, and at least 60% of the staff have been there less than 4 years, plus obviously a new CEO. Old hands know the old traps. And the customers.

Meanwhile, Brian is perhaps discovering the speed wobbles inherent in taking on a new company! Keep it up, mate! You've still got the maiden profit to announce, and Rome wasn't built in a day. But maybe share a bit more of the detail with us as a token of good faith.