APX - Capital Raise

Reports (14) My Report Forum Investors

Forum Topics APX APX Capital Raise

Pinned straw:

thunderhead

Added 6 months ago

Appen's got the hat out to shareholders again -

Highlights

• A$50 million underwritten institutional placement to provide balance sheet flexibility to fund

generative AI related opportunities (Placement)

• Appen has returned to underlying EBITDA and underlying cash EBITDA profitability in Q3

FY24, having taken the necessary steps to manage its cost base in line with the revenue

opportunity

• Appen’s external customer environment continues to show signs of improvement,

particularly from generative AI related projects. Proceeds from the Placement will provide

additional liquidity to fund working capital and provide greater flexibility to pursue

generative AI related opportunities

• Upon settlement of the Placement, Appen will have a pro-forma cash balance of

approximately US$62.4 million

• Opportunity for eligible existing shareholders to participate via a non-underwritten Share

Purchase Plan (SPP) which is targeting to raise a further A$5 million at the same offer

price as the Placement (A$1.92 per share (Offer Price))

The accompanying trading update and commentary are positive, but I don't like the repeated issuance of new shares, and I doubt the market will be too (though happy to be surprised!).

lankypom

Added 6 months ago

After going from a lame duck to a dead horse, the chance of Appen becoming a phoenix are extremely remote. Avoid!

Strawman

Added 6 months ago

I agree @lankypom

It was, in essence, a labour hire firm that provided a very niche and now far less relevant service.

You can't cut your way to greatness, and as far as I can see they have yet to discover a new offering that has any significant and lasting demand.

Still, the field of AI is moving very fast and perhaps they can find some pockets of opportunity. But until that becomes more evident, I'll happily stay away.

Mujo

Added 6 months ago

Definitely as tiktok showed today - https://au.pcmag.com/ai/107735/tiktok-lays-off-hundreds-of-staff-to-replace-them-with-ai

Bear77

Added a month ago

28-Feb-2025:

They reported on Wednesday morning (26th Feb): Appen-FY24-Results-and-FY25-Outlook.PDF

Appen's SP fell -33.33% on the day, then another -14.32% on Thursday, then another -20.67% on Friday, so their share price has gone from $2.99 to $1.305 in a week (-56%).

Why? Well...

Because they're still posting losses. Another US$20 million loss for FY24 (which ends on Dec 31st for Appen), despite having ANOTHER capital raise in October - another A$50m (via a fully underwritten institutional placement) plus they raised an additional A$15m with their SPP in October/November with both the Placement and the SPP issuing shares at an issue price of $1.92 per new share. And now they're back to $1.30.

Their outlook statement on Wednesday wasn't overly inspiring either:

So... revenue variability expected, project volumes are tracking lower (i.e. less money coming in), but hey, they're maintaining their focus on managing costs and becoming profitable again, so I'm sure it will all work out just fine, right?

They might be a decent trading stock, due to the pump and dump nature of their announcements, but it seems that selling into strength is always a great idea with Appen, if you're brave enough to hold them (and I'm certainly not) - because the next cliff is not too far away, and it often coincides with their reports.

Appen Limited