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LightwaveRF – from “real energy and excitement” to CEO ‘stepping down’ in less than two weeks!

By Steve Moore | Tuesday 12 June 2018

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.

In December on LightwaveRF (LWRF) I noted that prior to a £5 million discounted fundraising it was cash crunch ahoy, though March-appointed CEO Andrew Pearson “look(s) forward to building a great company in the rapidly growing smart home market”. Less than two weeks ago Pearson talked of “real energy and excitement within the company as we work to leverage our market leading technology”. Now a Board Changes announcement…

“Andrew Pearson has stepped down from the role of Chief Executive and has left the company… wish him well in his future career”! So much for building a great company and the real energy and excitement then!

The “real energy and excitement” was stated in results for the half year ended 31st March 2018 – the results though showed a loss increased from a corresponding prior year £0.33 million to £0.87 million on revenue actually slightly lower at £1.13 million. After particularly a net working capital outflow (over £1 million) and development spending (over £0.5 million), despite the noted discounted fundraising, period-end net cash was only £2.1 million.

The CFO, Kevin Edwards, is to be interim Chief Executive, before Jason Elliott is expected to join “no later than mid-September” - Elliott currently Chief Sales Officer for Onzo Ltd, which provides energy data analytics to major utilities. Chairman Barry Gamble looks “forward to welcoming Jason Elliott who brings with him a strong sales track record and a good understanding of the energy and related markets, which the company is seeking to address. His experience in fast moving technology businesses and the smart home market is highly relevant to LightwaveRF at this time”.

Then again just over 15 months ago Gamble was “delighted that Andrew Pearson has joined the board. His appointment marks another important step in the continued development of LightwaveRF. He has considerable experience in growing technology and internet related businesses and brings with him skills that will strengthen the company's ability to deliver its strategic goals”.

Why has he now gone then? And even if there is “real energy and excitement within the company”, it’s, as usual, the ability to generate cash which should prove key. On these bases, it’s currently bargepole ahoy / sell.

Tom Winnifrith discusses just how much of a cash crisis the company faces in bearcast HERE

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