IKE - Ike GPS.com

[sb9]

Should get Q3 update in a couple of weeks. Cant wait. the revenue growth lately has been amazingly good.

From 2016 to 2021 revenue growth was 0%.. Oops. Went from $9m per annum to.. $9m. Peaked at $10m in 2020. All good thou, this was the building phase. The business was establishing and investing in itself. Kind of like when a café set's itself up and needs to fit out the kitchen, buy the table and chairs, purchase the right cash register, stock the fridges etc before the money is made.

Q1 F22 is when things really started to crank. The 5 year 0% growth charged to huge QRT on QRT growth:

FY22 Q1 revenue $2.6m
FY22 Q2 revenue $3.1m = 19% QRT on QRT growth
FY22 Q3 revenue $4.2m = 35% QRT on QRT growth
FY22 Q4 revenue $6.0m = 43% QRT on QRT growth
FY23 Q1 revenue $6.8m = 13% QRT on QRT growth. 162% PCP growth
FY23 Q2 revenue $8.6m = 26% QRT on QRT growth. 177% PCP growth

Awesome stuff. Q3 will alone produce more revenue than they used to do in the 5 years before (p.a.)
They are on track to do somewhere between $35m and $38m this year at the current run rate.

Market cap is $145m.
I think a 5x revenue multiple is not unreasonable given the huge growth rates and the fact that they are operating in a recession proof industry with a fortress balance sheet and huge market (see my post above).
Thus we get to a 31 March 2023 market cap valuation of $175m to $190m.
Or target SP of $1.10-$1.19

Todays SP is $0.91 so a 20-30% gain on the cards. This is what i was looking for earlier today

Disc. Holding and happy

I think market waiting to hear about the confirmation of growth/profitable trajectory and it'll take off once the news is in. BBs getting tighter towards upward momentum.

[Cobber]

Should get Q3 update in a couple of weeks. Cant wait. the revenue growth lately has been amazingly good.

From 2016 to 2021 revenue growth was 0%.. Oops. Went from $9m per annum to.. $9m. Peaked at $10m in 2020. All good thou, this was the building phase. The business was establishing and investing in itself. Kind of like when a café set's itself up and needs to fit out the kitchen, buy the table and chairs, purchase the right cash register, stock the fridges etc before the money is made.

Q1 F22 is when things really started to crank. The 5 year 0% growth charged to huge QRT on QRT growth:

FY22 Q1 revenue $2.6m
FY22 Q2 revenue $3.1m = 19% QRT on QRT growth
FY22 Q3 revenue $4.2m = 35% QRT on QRT growth
FY22 Q4 revenue $6.0m = 43% QRT on QRT growth
FY23 Q1 revenue $6.8m = 13% QRT on QRT growth. 162% PCP growth
FY23 Q2 revenue $8.6m = 26% QRT on QRT growth. 177% PCP growth

Awesome stuff. Q3 will alone produce more revenue than they used to do in the 5 years before (p.a.)
They are on track to do somewhere between $35m and $38m this year at the current run rate.

Market cap is $145m.
I think a 5x revenue multiple is not unreasonable given the huge growth rates and the fact that they are operating in a recession proof industry with a fortress balance sheet and huge market (see my post above).
Thus we get to a 31 March 2023 market cap valuation of $175m to $190m.
Or target SP of $1.10-$1.19

Todays SP is $0.91 so a 20-30% gain on the cards. This is what i was looking for earlier today

Disc. Holding and happy

What a fantastic post. Thanks for putting all of that together. I've held these shares for years just waiting for the stars to align.

Don't forget they have a huge amount of cash sitting in the bank which could also increase their valuation provided they start turning a profit.

[Forrestdun]

Revenue guesstimate for the Quarter $11.7mil

[petty]

Revenue guesstimate for the Quarter $11.7mil

I like that you’ve put a number on it. Most people on here make vague predictions and then claim their own genius after the fact. Bit like a tarot card reader.

I do love your optimism but think you gone a bit optimistic. I’m in at $10.4

Let’s see

[winner69]

I like that you’ve put a number on it. Most people on here make vague predictions and then claim their own genius after the fact. Bit like a tarot card reader.

I do love your optimism but think you gone a bit optimistic. I’m in at $10.4

Let’s see

FWIW my estimate (modelled and not a vague prediction) is for $10.6m heading to $39.0m for full year

Pretty good I reckon .... even though guru analysts think full year sales won't be anywhere near $39m

[Rawz]

$39m full year revenue

[t.rexjr]

Q3 will be bolstered by a fairly healthy exchange rate through October/early Nov. It should also include a chunk of Q4 22's large amount of closed contracts. I'm predicting 2 fairly even Qtrs of high 10's, finishing a touch over 37m...

Though fingers are crossed that proves to be conservative if more contact revenue is recognised. I'm a little unsure of how the drop in contracts in Q1 and Q2 effects ongoing revenue. I assume 88%ish of Q2 is recurring so a base of 7.5m + whatever % of closed contracts is new revenue... That's the Grey area as closed contracts surely include new and recurring. The graph seems not to equate to recurring + closed contacts 9 months prior. So what is it? Kinda meaningless without giving parameters as to what closed contracts pertains... if closed contracts were all to convert to new revenue then sheesh kebabs, look out!

Profit should rocket on further revenue growth.

[Rawz]

My modeling says $10.875m

[Rawz]

Q3 will be bolstered by a fairly healthy exchange rate through October/early Nov. It should also include a chunk of Q4 22's large amount of closed contracts. I'm predicting 2 fairly even Qtrs of high 10's, finishing a touch over 37m...

Though fingers are crossed that proves to be conservative if more contact revenue is recognised. I'm a little unsure of how the drop in contracts in Q1 and Q2 effects ongoing revenue. I assume 88%ish of Q2 is recurring so a base of 7.5m + whatever % of closed contracts is new revenue... That's the Grey area as closed contracts surely include new and recurring. The graph seems not to equate to recurring + closed contacts 9 months prior. So what is it? Kinda meaningless without giving parameters as to what closed contracts pertains... if closed contracts were all to convert to new revenue then sheesh kebabs, look out!

Profit should rocket on further revenue growth.

Im interested to know what the closed contract means as well. Like last year (see below annoucement) they said they signed a $900k contract which would be delivered over the proceeding 12 months. Then they added that they expect $200k p.a. in subscription revenue with this customer. so i was thinking closed contracts represents transaction revenue (which is reoccurring as well) and hardware revenue. And subscription revenue is separate to the closed contracts. Anyone know how it works?

--------------------------------------------------------
21 January 2022 (all numbers are NZ$ unless stated otherwise)
Deal follows a separate announcement earlier in the week of extending a U.S. communications customer contract to >$4m.
ikeGPS Group Limited (ASX/NZX:IKE) or IKE, the company setting the standard for collecting, managing and analysing pole and overhead asset information for electric utilities, communications companies and their engineering service providers, is pleased to announce:
 That it has received an approximately $0.9m contract from a new tier-1 North American electric utility customer.
 The approximately $0.9m revenue will be fully recognized over the coming 12 months.
 At this initial level of users and platform usage, the expected ongoing software subscription revenue from this customer will be approximately $200k per annum.

[justakiwi]

I believe "closed contract" refers to "signed" contracts, as opposed to contracts still in negotiation. The initial contract covers the major project work to set them up (including devices) then there is a recurring subscription payable to continue to use the IKE platform and analysis (companies can either do their own analysis or pay IKE to do it). I have read a full explanation of this somewhere in the past, but having trouble remembering where now.


This might help:

The core revenue engine for IKE is driven by the number of enterprise customers subscribing to the IKE platform and the volume of assets (called Transactions) being processed through IKE’s software.

EDIT: I just had a thought - I think "volume of assets" (or transactions) must refer to the number of poles a customer is collecting field data on/analysing (themselves or by IKE). So the larger the customer's network, the more IKE receives in subscription revenue.