By Steve Moore | Friday 19 May 2017
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
Commenting yesterday on the “Launch of Google Assistant voice control” ramparoonie (Oops) RNS announcement from LightwaveRF (LWRF), I suggested it clearly currently remains cash burn ahoy, with results for the six months ended 31st March 2017 following today.
These show 46% revenue growth, to £1.17 million, though still a loss of £0.33 million (corresponding prior year period: £0.38 million). Indeed, despite £2.22 million of new equity, after further cash outflows (including £0.67 million in working capital), there was little more than a £1 million swing to a £45,575 net cash position.
The net tangible assets v. liabilities position swung by £1.82 million, to +£0.83 million – with transferring inventories and receivables into cash something to keep a particular eye on going forward within overall cash burn.
The results statement includes that “there remains much work to do and additional investment to make” - specifically noting the likes of “we intend to significantly strengthen our management team”, “a step change in marketing investment”, “launch a new range of devices”, “launch an enhanced and redesigned app”, “expand voice control capability”.
That all suggests further cash burn ahoy, though it's still concluded “looking further forward, we will begin to prepare for international expansion, and we may make acquisitions”! I’d suggest the current cash burn and balance sheet don’t suggest the strongest of positions for that. They do though see this retained on the bargepole list.
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