considering that they have cash flow, a couple of products, contacts, contracts and partners, 6 million in cash and no debt.
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At first glance there is no figures to go from, but I was interested last night and had a dig.
The half yearly report shows that the performance plan has the following hurdles:
- Achievement of sales revenue of A$500,000 per month, on an annualised basis over a 3 month reporting period, within two (2) years from implementation of the plan.
- achievement of sales revenue of A$1,000,000 per month, on an annualised basis over a 3 month reporting period, within two (2) years from implementation of the plan.
- achievement of Intercept shares trading on the ASX at more than A$0.05 per share, based on a 20-day volume weighted average price, within two (2) years from implementation of the plan.
- achievement of Intercept shares trading on the ASX at more than A$0.075 per share, based on a 20-day volume weighted average price, within two (2) years from implementation of the plan.
So take these with a grain of salt as they could be worth just that, but if your going to build any kind of model then this would probably be a starting point as to where the company hopes/expects/aspires revenue to be at.
So $6.1m cash as the starting point, less the burn rate. Which at this point is a complete guess.
Potential revenue for FY16 $0 to 12m. I will use $6m as the halfway point, but until we see evidence of actual audited sales $$, then the minimum potential revenue is still $0!
Potential EBIT for FY16 $-x to 2.4m. I have used -x as the lower end as the operating cost of the business is still unknown. I think their distribution model is a good way to hit the mass market without blowing up the PnL (AHZ take note of this), so perhaps the cost base will not be too extravagant. $2.4m for the upper end would represent a 20% margin which for a "successful" technology company should be achievable.
Requirements for reinvestment into the technology/upgrades/new products - I really have no idea at this point.
Working capital requirements - again no idea, I think it's safe to say that the analysis is too rough to even bother getting to this level of detail yet.
It's important to remember the shares on issue will depend largely on the performance of the business. The satisfaction of the above hurdles will result in a 1 for 1 issue to key management personnel.
Current shares: 1042m
Options: 1.175m
Performance Rights (4 tranches): 242.38m
So a potential dilution of 23%. However, shareholders should welcome that dilution if the company can
sustainably exceed the hurdles and continue to grow.
Certainly something that is exciting enough to keep on the watchlist as a potential spec play.