Kromek (LON:KMK)
Thought I would start a separate thread on Kromek - in part because the comments I posted on Tuesday did not link to the discussion history (no idea why) but mainly because the share has risen nearly 50% on the news.
I wrote; a comment about Kromek (I hold) – a jam tomorrow company – posted a half year report today and it is starting to look like tomorrow may be just around the corner!
In summary – profit on the way – balance sheet looks safe enough (i.e. no more dilution) and a growing order backlog – recently announced $9m in new orders. Analysts say FMV north of 25p (5.5 atm ) which maybe too ambitious but positive none the less.
Key points below:
- Revenue increased to £7.1m (H1 2023: £6.8m)
- Gross margin improved to 54.2% (H1 2023: 40.4%)
- Adjusted EBITDA loss reduced to £0.1m (H1 2023: £2.7m loss)*
- Loss before tax reduced to £3.5m (H1 2023: £5.7m loss)
- Cash and cash equivalents at 31 October 2023 were £3.7m (30 April 2023: £1.1m)
- Net cash used in operating activities substantially reduced to £1.6m (H1 2023: £4.0m)
- Refinancing of its debt facility with new £5.5m secured term loan in September 2023
- Equity fundraise of £8m (gross) in May 2023
- Remain on track to deliver significant revenue growth and positive EBITDA for the year to 30 April 2024
My big questions are;
- when will it become cashflow positive?
- how robust is the balance sheet - seem to have lots tied up in working capital?
Your question to me be might be why on earth do I hold it? Historic - based on a "paid for tip" and my inability to cut my losses!
