On the NAPLAN contract and how much it was uplifted from the initial contract - I'm not sure, I was just guessing. It was disclosed in the prospectus that they made $5.7m (37% of revenue) Education Services Australia (the group responsible for NAPLAN) in FY17. But the online assessment was not hosted until FY18, so much of that revenue would have been once-off preparation in software development and the initial test development. Looking at the revenue from the "largest 3 customers" over the years, my guess would be NAPLAN was worth approximately $4m/year to Janison, so maybe there's no uplift at all.

On the cash issue. Management has reiterated over the past several months that they'll hit free cashflow positive for this financial year. The expectation would be that they'll be back to $11m by the end of FY23 ($1m for lease liabilities assuming they're using the more "liberal" definition of FCF). Cashflow can be a bit lumpy due to the business it's in and when the events happen - e.g. NAPLAN is in 2H, ICAS in 1H but cash starts coming in during 2H, assessments and exams at the end of semesters, etc. I'll give them the benefit of the doubt here, but it'll be a red flag if they miss $11m by a large margin.

@mushroompanda do you think there is much risk that the education system or a change of government direction moves away from using Naplan before 2030? Do you know if it is a 3 year contract for $12m fixed price or is it based on minimum annual price and then top up fee based on the number of students taking the test?

I am only wondering this as the newsflow I hear from some teachers and the media is that noone really thinks that Naplan is a good system to assess kids knowledge or whether a school is doing well/bad, but I am too far removed to really know how true any of this is. Do you consider this a risk?

I agree that the oxford and cambridge information is very positive.

@Slideup I don’t know whether it’s fixed or has a variable component (expect the latter), nor am I able to quantify the risk of the government changing plans.

Should there be a change afoot with NAPLAN, provided it’s not a move in dropping assessments completely, Janison is probably well positioned to adapt. Janison has a very strong relationship with the NSW DoE and is delivering the NSW Check-In Assessment (won in 2020, and still ongoing) and the NSW selective school assessments.

There’s always a lot of talk about dropping objective measures like assessments for students. While I agree students shouldn’t be dedicating a lot of time to learning the nuances of individual assessments, overall I’m pro assessments in general. When structured correctly, it’s a great way of measuring a student’s abilities and speed up the feedback loop. It also provides brilliant kids from disadvantaged backgrounds a method for upward mobility. My views on this was reenforced after listening to the multi-part podcast series on US charter schools by the Startup Podcast (Gimlet Media).

maybe im reading too much into this announcement but i found it a bit odd. first i thought it was a captial raise, then an acquisition, then realised they were talking about the revenues of the ct. then i thought they did this because they needed capital, then i thought they are probably disappointed with the share price. all within two minutes. just a strange way to convey the message imo

@Solvetheriddle I assume you've never laid eyes on an Advance Zinctek (ASX:ANO) announcement :D