Cyanconnode Share Discussion Threads

[derek ten bag] 26/7/2024 17:03

Come on Multi, you know we want to hear from you and I, for one, would value your opinion on the results. Between this forum and the other one the views vary between very disappointing (even 'worrying') and 'nothing to see here, folks'. I just feel that FY24 involved a significant ramp up in the business which naturally incurred an increase in costs. We are into gross profit, which is good, and are moving, increasingly, into the recurring revenue part of the business, which is also good. A couple of decent orders to calm the nerves would also be good. The main concern for me, as always, regards working capital, but Heather addressed this issue (as did the Zeus note) in the Q&A and its addendum and they seem to be pretty sanguine about bolstering reserves if required, ideally with either no, or minimal, dilution. As ever, we live in hope.

[beeezzz] 26/7/2024 09:06

Well one thing results show wafer thin margins, unfortunately its world we live in, elephant in the room is China, they'er depressing prices of everything that can be mass produced at a fraction of the cost..

Do they have manufacturing a facility in India, if not they should do.

[derek ten bag] 26/7/2024 08:59

Morning ITT. Clear, unequivocal, calm, lucid, fair, measured and balanced, your analysis of all things Cyan never fails to impress.

[inthetin] 26/7/2024 08:33

Since Panmure Gordon's appointment as joint broker (18/04/24), the share price hasn't spent a moment above 8.3p, regardless of the news released. Of course it hasn't, they need to get their clients in at as low a price as possible.

IMO, there's a whopping 'going for growth' fundraise coming - I'll guess another 50-60 million shares at 7p'ish (EIS qualifying) with warrants attached (you never know, one day, someone might actually be able to exercise some of these issued warrants).

These sh*te FY24 accounts will have been kitchen-sinked to facilitate this grab of a large chunk of our company.

Why do you think you haven't heard a peep from the old windbag.

[tightfist] 25/7/2024 14:19

Aside from the impressive escalating revenue figure, I thought the rest of this morning's RNS was extremely disappointing, even worrying, as has already been related by NTG. It was a painful reminder of the maxim "Turnover is vanity, profit is sanity and cash is reality "; CC remains firmly stuck in the Vanity phase. .The escalation of year-end headcount by 71% was astonishing, and far far away from the original premise of Eco-partners, and low overhead scalable operations.And erosion of GM over the last continuing over FY2024 is not what IRC being promised 12 months ago. As I said recently, a MEANINGFUL quantum of high margin maintenance revenue is still some years away IMHO, please DYOR and perform your own calculations - "hope" is not a good investing friend. Not to mention the growing, enduring Receivables line..Shareholders are being left to guess how the weak state of the balance sheet will enable the transition to an AMISP role. That is the biggest answer question as far as I am concerned. But may also hold the transitional change in the CC business model and funding; the final throw of the dice, JC?.Looking forward to the AGM...... tightfist

[tony284] 25/7/2024 13:46

We're living in a world of political and economic uncertainty and doom and gloom. Whilst in the UK our new government has hit the ground running with some excellent policies for growth, particularly in the green sector. The markets are still waiting to see the small print regarding how this is going to be achieved. In more optimistic times I think today's results would have been interpreted much more positively.

[markingtime] 25/7/2024 13:41

Just re the idea of raising capital, that might be quite easy if, for example, they licence use of their products within India. That would extract a big chunk of value and leave the company free to pursue other territories.

[derek ten bag] 25/7/2024 13:33

We still await the ruminations of the great panjandrum. I agree with some of your comments Nick, but I feel you may be being a bit severe in others. We need to get to that point at which outgoings moderate and higher margin incomes start to ramp up. That will hopefully be the case through the current financial year. The main factors holding us back in FY24 were related to certain technical items and what must have been significant increases in personnel costs associated with the sharp increase in staffing levels. Probably had to be done. I would like to see HP and Nitin reinforcing (ideally without dilution) the working capital. We could breathe a bit easier then. But the sharp increase in revenue is very commendable, in my opinion at least.

[nick the greek 1] 25/7/2024 11:05

Duplicate post.

[nick the greek 1] 25/7/2024 11:01

My guess is that they were waiting on some good news to ease the pain of this debacle but that hasn’t happened yet.

I also guess that the reason they said in public that they do not need to fund raise at present is that the potential order mentioned above could be invoice discounted or like and thus save a placing.

Either that or their bringing some money in from an Indian investor/partner/ipo that negates the need for a fund raise here which isn’t quite ready yet.

So are these awful results a precursor requited to get the price down even further as the incomer isn’t happy as things are or is it just that they were running out of time and thus to save the further humility of doing them next week (which would have been even worse) they did them now?

People keep talking of the fear here being of a cheap take over, that’s been orchestrated and set in place to happen for a long while here imo as JC saw it as the only viable exit available to him a long while ago.

Time for a large trading punt at about 6p anyone?

[derek ten bag] 25/7/2024 10:49

I agree with your comments MT. The key number for me is working capital over the next six to twelve months until the higher margin stuff kicks in. But we have Nitin Jain in India, whose CV on the website suggests he has particular skills in capital raising. I do believe HP does a good job in keeping the finances in check, but we just need a more robust capital buffer in the short term.

[markingtime] 25/7/2024 10:38

I think the answer lies in the step change in margins. Installation etc is a low-margin activity. Operation for the following decade is not. They are looking at 90% going forward.Profitability and cash flow depends on the balance between the two parts of the business. In my view, the company is pretty much at the low point in this cycle - and I expect someone to take advantage of this and buy them out whilst the company is stretched.

[stupidboypike] 25/7/2024 10:34

DTB,

Bad on almost every measure is my quick analysis I'm afraid,
Expected t/o 16.3 Actual 18.7
Expected EBITDA (1.1) Actual (3.8)
Expected gross profit 6.5 Actual 5.6
Expected margin 40% Actual 30%

Yes they have given an explanation as to why margins are down and that this won't be the case this financial year, but to miss expectations by such a wide mark gives the market no confidence in this years expectations. Broker is predicting an EBITDA this year of 4.4m, but last years prediction was 2.7m out!!!!
The share price will not turn a corner now unless there are some massive orders announced IMO. I got pretty fed up waiting on Cyan about 2 years ago, these results have not helped that at all!!!

Best regards SBP

[nick the greek 1] 25/7/2024 10:16

You don’t really need a forensic analysis of these results it’s all quite clear.

Their taking in more money and making a bigger loss.

That’s not a great business model.

There’s no “real” guidance on numbers that will change that or indeed when the (much awaited) other orders will come in to change that.

John Cronin must be one of the most deluded managerial company heads on AIM and that’s saying something.

15 years and over a £70m loss to date and he still can’t get it to work.

He would be sacked if he had a stronger bod and that’s why he keeps his bod weak.

Orders will come at some point and then the price will change if the numbers are proven and shown to work but that will be when it’s Indian based imo.

How he can possibly keep banging on about how successful they are and stay in a job is completely beyond comprehension

[beeezzz] 25/7/2024 09:46

Still loss making, did they give any indication when they hoped to be cash positive, this would help the share price considerably...

[derek ten bag] 25/7/2024 09:02

Be good to get some forensic analysis from some of the regulars on here to reassure those of us who are less skilled in interpreting the fine details. In most ways, the results read well, but it seems to me that the fly on the ointment is, as ever, working capital. Given that we have no debt, according to the recent Q&A, perhaps time to take some on?

[indiestu] 25/7/2024 07:29

You have to admire their ability to juggle cash. A Director loan shows confidence but demonstrates how close they are operating to the bone. 2025 looks promising. If there were a fund raise which they say they don't need I'd take it up at these prices considering the outlook.

[daddy warbucks] 22/7/2024 23:03

RNS tomorrow to inform us of results on Wednesday?

[fxl5] 22/7/2024 13:02

Very vunerable to takeover now. Even more so after upcoming results.

[markingtime] 21/7/2024 20:39

Results due very soon, surely?

[derek ten bag] 21/7/2024 16:39

Thanks SBP and TF. That's what I was hoping to hear, SBP. If the broker profit forecasts were to increase significantly on the back of this weeks results I suspect the share price would respond positively. Some new orders would then provide even more impetus. The point TF makes about the increased costs of additional staff is the one thing that might hold things back a bit, but I do feel that Heather keeps a pretty tight control on spending, so I expect them to manage costs as effectively as possible.

[stupidboypike] 21/7/2024 16:28

DTB,

Of course it is possible, but also, as we know from the recruitment drive, and the Nov fund raise, costs are mounting too. Broker estimate was EBITDA -1.1m for f/y '24. t/o was 16.3m. If the material exceeded is +15% = 2.445m, gross margin 40% = 0.978m, so we could be very close to break even with a good wind behind us! I'm more focused on f/y '25 which is almost a third of the way though already. I think once the market sees genuine profit, and growth, we can expect a re-rate (and not before time!).

Best regards SBP

[tightfist] 21/7/2024 16:08

Hi MTB, a couple of observations. We went through the wildly optimistic phase, after which JC publicly recognised a couple of years ago that all shareholders were now interested in was ORDERS..In fairness, to have ~80% of FY2025 revenue forecast covered by existing contacts in P2 is IMHO pretty good, particularly when you note the forecast shipments/revenue acceleration. It's their lumpiness that seems disquieting..As I noted yesterday, IMO the high-margin post Go-Live revenue stream will be minimal for a while yet - but happy to be disproved. tightfist

[derek ten bag] 21/7/2024 13:48

thanks Multi. The point I was trying to make is that if the YE24 revenues have materially exceeded expectations, might our profit expectations have been exceeded?

[multibagger] 21/7/2024 12:06

Hi DTB :)

Three parts to your query as I see it.

1. The "materially exceeded expectations" element is for year ended Mar 24 (last year) - so it is a question as to by how much did it exceed the market expectations ?

2. The more recent RNS about SAT and "Go live" are in the current financial year and hence won't have a bearing on results from last year.

3. We are not expecting a profit for the year ended Mar 24. A profit for year ending Mar 2025 is forecast if memory serves !