Management must be very frustrated that LRM's excellent revenue growth reported on 20 October 2016 has resulted in the most minimal rise in share price. The shares continue to languish at 8p, down almost 40% from the year's high in April before management announced the triple bombshells of a profit warning owing to cost overruns, a programme to burn tremendous amounts of cash in the next year on an unvalidated investment programme, and the circumvention of shareholder AGM voting resolutions on pre-emption rights to fund this spending binge.

So why is the share price still on its knees with institutions not exactly stepping up to the plate to back management's "huge pride" in these results ? The answer is purely down to costs and resulting alarming cash outflow. There was a GBP 4.3m cash outflow in H1 and the latest broker note forecasts a further GBP 5m+ outflow in H2. Today's (or rather end Sep) cash of GBP 6.9m looks strong but end Mar-17 cash is forecast to be only GBP 1.5m. That gives very little room for error and institutional investors must see a chance of the company having to come back to market if there is even a small project overrun. Until there is a management team that is less irresponsible with the company's finances it is hard to see the shares not continuing to be underrated.

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