Lightwaverf Share Discussion Threads

[clocktower] 11/2/2019 14:18

Amongst a host of other alternatives they could raise funds, secured against projected sales on top of offering other securities I expect.

What a nice shock it would be for all small shareholders if they sold the company at anywhere near the 3 times current price suggested by sinkyj, getting themselves out of a hole that is getting ever deeper imo.

[athnotts] 11/2/2019 14:05

yes but maybe it would have been easier in sept than it is now, ie re brexit i mean,
we are literally at peak uncertainty right now. but i do think (and have said on here before) a strategic partner is needed. if you are correct re propensity for board holders to avoid dilution than a 2m raise plus a year to work on getting a strategic partner (resideo or someone else) could well be the chosen route.

[sinkyj] 11/2/2019 13:49

Having just done the same, Athnott. The answer is it's not quite so easy at the moment, even compared with 6 months ago. Brexit, Trump vs China, China slowdown mean money is a little tighter around the world. It's probably is taking longer than expected or they are considering other options as CT says.

I'd guess they could easily sell at 2 or 3 times the current market valuation to the right buyer, where an annual $3-4m loss is very small change. If not more, Alertme that became Hive sold to British Gas for 44m GBP with only 150,000 subscribers on board ( mostly British gas ones). My guess would it would have to be a utility that's been left behind in the Smart home area. The deal with Resideo seems a one sided one at the moment. LW getting something missing, not so obvious how Resideo win (in a large enough way). Resideo could be gaining a large number of customers from a revenue stream they've not tapped.......

[clocktower] 11/2/2019 12:27

Maybe nobody will put up the money, unless it is at a huge discount athnotts, or of course they have indeed looked at another more appealing course of action that would resolve the problem that must be becoming critical as you seem to be in agreement.

[athnotts] 11/2/2019 12:04

what's surprising (and they are not the only ones...) is how close they are to the end of the cash runway before doing a raise, i don't see any rationale in doing that, incl dilution avoidance, ie dilution is likely to occur if the cash need is urgent. this was in the back of mind as i wondered how close to b/e they were. share price was over 14p in june, not that far off what they raised at last time, then the previous ceo left and it dropped, then it got to 13p in sept, should have done the raise then??

[sinkyj] 11/2/2019 11:47

Looking thought the front window, costs will only go up. They need to use money to get the revenue. Margin's won't significantly change by 2 or 3x numbers. I think they will be better than last year, there's something a little odd about the GM going down with more direct sales. Probably the clearance sales they've were doing.

They need 10m revenue to be getting somewhere and then even then, there will be a push for more cash to drive more growth. The issue, just at the moment, is the current valuation.

They probably need 30m to get quickly to 10m revenue, they can probably take another 5m, maybe the controlling shareholders wouldn't want more than 2m (1 year runway)to avoid dilution and then see if something happens re Honeywell, Apple etc. But cash they will need from somewhere. Playing with the likes of Honeywell, probably, has opened some other doors. A joint promotion with a Utility, Honeywell or Apple could change things quickly, if the company is healthy to take advantage.

There's one trade on today's news(a very small sale). Everyone is waiting now to see numbers other than You Tube views.

[athnotts] 11/2/2019 10:54

did say i was knew i was being simplistic. but - can't drive looking through a rear view mirror, that's not going to get you very far. i was thinking maybe that some mix of reduced average cost of sales through volume increase, reduced admin costs, increased gm re more direct sales in the mix etc etc would impact. can't see into this sort of detail without full accounts and by the time these are out the data covered will be 5 or 6 months old. anyway was just pondering really, did say "maybe" at the end :-)

[clocktower] 11/2/2019 09:54

athnotts, Although I would have been sworn to secrecy and could not post the fact, as I would be breaking the law - If however I told you that I had been approached to take part in a round of funding - would you still be thinking I was telling you a load of porkies, or do you think I would just be dressing a nice roast?

There are ways that LWRF could avoid needing to raise funds imo but that includes the company being taken over but I can think of another number of options also that the BoD may not have even given a thought about, however you never know they might have, which would leave any small investors much happier than I envisage they are at present.

[sinkyj] 11/2/2019 09:25

Sorry, just choked on my cornflakes. "Not doing a fund raise". If you have followed for anytime you know the chances of a fund raise are directly proportional to the frequency of news releases. Especially, vacuous ones like this.

I'm not sure on the maths athnotts. I might be wrong, but I think you forgot the cost of sales goes up with revenue. Assuming the same gross margin and the same Admin Expenses of 3.7m. If you were to be very generous and say they double revenue (5.6m) and therefor gross profit(825k) then Gross Profit would be 1.6m. That's 2.1m short.

There are tax credits(410k) but they are already borrowing against those. I make that a long way from break even. And break even doesn't give you money to grow and virtually nothing has been spent on marketing this year.

I've posted previously on where revenue needs to be and how much investment they will need to get them there. You might begin to see the issue from the above figures. What they achieved with the 5m raised last year was revenue slightly less than the year before (but growing), but the killer is they managed to increase the costs of the business nearly 3 fold. Not an ideal result for shareholders.

[athnotts] 11/2/2019 08:46

:-) Perhaps clocktower sold at, er, 10-11p ish?, and wants the price to go down so as to be proven correct re that call...

Re where the cash is coming from to run this business... no accounts for last year yet and last update was that Oct-Dec saw 1.15m in revenue. if that level sustains then that's 4.6m annualised, vs a cost base of about the same (only re taking revenue and losses info from the October trading update - bit simplistic but nothing else to go on presently). so they could be running at/near break even assuming cost base is being held. growth in the current quarter would make things better than that. so maybe they are not doing a fund raise. and maybe clocktower shouldn't have sold!

[clocktower] 11/2/2019 08:44

LOL whoppy, I hope you managed to make a decent profit on the last bounce but desperate times call for desperate measures but that 70k buy that you flagged as possibly being a insider buy can now be seen to have little substance and this RNS is nothing more than verbal diarrhoea leaving a empty bowel without even a solid stool to show for it.

[whoppy] 11/2/2019 08:17

Lol. Calm down Dear. It's just a commercial. You're sounding jealous.

[clocktower] 11/2/2019 08:10

Was that Media RNS worth a light?

Seems to me to be a case of being desperate to try to hold the share price up with nothing more than fluff - Brand awareness, strong interest but notice not a word about sales numbers just Conversion rates are being tracked.

Pray tell us how the money is going to be raised to pay for this campaign - will it be from long suffering shareholders that have been generously paid to squander away their money based on false hope once again?

How much cash is left or is the company already back borrowing more money?

Facts they hide it seems to me.

[whoppy] 08/2/2019 15:57

I'm liking the 70k buy. Director/ Management?

[whoppy] 07/2/2019 15:08

Looks like Lightwave are teaming up with HBS Group. Getting in with commercial properties and energy saving experts for fit outs of businesses and PLC's.


HBS-Group
‏

@tweetsfromhbs
Jan 18
More HBS-Group Retweeted Lightwave
HBS love Lightwave, watch out for the launch of our HBS online shop which will stock a range of @LightwaveRF products hxxp://hbs-group.org

[athnotts] 06/2/2019 10:49

let's assume they deliver on the integration (as an aside I looked at their board and management profiles on linkedin and i noticed they have a cto with a software background who is different from the founder cto listed on website - bit confusing but i think it means they have both hardware and software experienced tech leadership, which is good). so after the tech piece gets done it's all about go to market activity - if the sales teams are tasked and paid comp to work together, and the marketing teams work together and agree spend on campaigns that complement each other then it can work really well. and if it goes well a large friend who can invest and/or provide debt and/or start reselling and/or buy them in the future would be great...

[sinkyj] 06/2/2019 06:14

Goes without saying this is very good news. Resideo earned $4.8B last year with Honeywell home being one if the leading smart home brands, particularly in Heating and Security. Resideo use multiple protocol and are part of the Zwave camp. Zigbee being the other major global standard which Den use.

It is only a baby step at the moment but as the release states it will fill the holes in the lightwave range, something not easy to do as they don't use a standard protocol. This is important as any UK utility would need a complete integrated range of products to provide it's customers.

Eventually, I hope the end game would be access to the Resideo, 4.7m US customers as co branded sockets and switches and hopefully, acquired. Honeywell and presumably Resideo are a much more acquisitive company than Apple. They have a different history and structure.

In the short term there will be much work to integrate and all the usual caveats stated in the previous posts regarding delivery on promises still apply. Lightwave's strengths aren't it's software, Apps and marketing. I'd sooner be reading that Resideo was integrating and co branding Lightwave than the other way round.

Lightwave are too small and too poorly resourced to become or even stay a global smart home provider. They have a much better chance focusing as a supplier to a larger organisation. I hope this release is a step on that journey.

There has been much criticism of LW here, including myself, but I can tell you, it's not at all easy to make quality dimmers and sockets. Lightwave do that, and they are amongst the best, which is why Resideo are talking. Let's hope Lw fully focus on delivering this integration.

[clocktower] 04/2/2019 18:15

They told us they would have new products coming for years now, so nothing really new there.

[whoppy] 04/2/2019 16:46

Lightwave have new products coming very shortly which will be good.

[clocktower] 04/2/2019 16:42

Clearly, I think resideo might think the advantage is with them, as it opens to door to Apple in the EU etc. You can "envisage" a lot of things, much like having dreams but waking up to a nightmare that you are left holding stock in LWRF that has been diluted so far that it knocks most PI`s into oblivion.

[whoppy] 04/2/2019 16:37

They use the same protocol so can share products and SmartHome offering. Lightwave look to have more in the way of plug sockets and switches. Honeywell have their own smart thermostat and wifi speaker with built in Alexa and security guard that looks after the home.

[athnotts] 04/2/2019 16:19

i think 'envisages' is consistent with this being an rns reach rather than a full rns, ie it is marketing news and not an announcement that's seen as material/disclosable etc. whilst we await sinkj to opine ;) from my knowledge honeywell is one of the key heating smart home brands along with hive, tado, netatmo and what happens with the "envisaging" we'll see, might well help a great deal if it turns out there is substance behind the "co-operative marketing and selling of product ranges", ie if there is some sales and marketing activity and spend.

[clocktower] 04/2/2019 15:23

The company only only "envisages" a lot of things......

Sounds to me much like a letter of intent but without anything really to show of substance.

Lightwaverf have promised much but delivered little, so will this change anything?

[whoppy] 04/2/2019 11:22

Be interesting to see Honeywells Resideo angle on SmartHome tech. With a market cap of $2.8Bn and in over 150 million homes and 10 million buildings worldwide and contracts with numerous energy utilities they certainly open a number of doors. Amazing how tiny Lightwave with a Mcap of £7m is in league with Resideo. I wonder what Resideo get out of it? Can see where this is heading in a takeover or some other collaboration with Lightwave products being licenced somehow and Resideo paying for all the costs. They get Apple approval aswell. Some big opportunities ahead with Resideo, imo. Fantastic news. Steady upward move as the news gradually sinks in..surprised it hasn't popped more.