Pinned straw:
Today's announcement making me glad I've walked back my exposure to Envirosuite. Once again, it just shows how elusive any material growth is for them.
To wit;
- Total ARR up 2.9% over the year (hit by FX, but also downsell and churn.. makes you wonder how recurring this revenue really is)
- New ARR was an improvement on recent quarters at $2.1m, but below what they did in the pcp.
- Churn increased a little to 4.1%
And there was also this:
The company is also consulting to explore a range of 'strategic opportunities' with 3rd parties. Which, I presume, is code for "we are shopping ourselves around to potential acquirers" -- although it may be something else. Possibly an acquisition to help rationalise another raise? (Although given their track record of acquisitions I'd be nervous of that).
EVS is now >2% of my portfolio after I sold down a few months ago, and even after today's drop is just on par with my valuation.
I'll probably look to sell down the remaining holding at some point unless there's a material turn around. But I have lost faith in management.
@Strawman I agree. It is never too late to sell. $EVS is a good idea. But from my perspective the execution hasn't been there for some time.
Hope over substance.
When I digged around trying to work out what's going on, I thought that high interest debt they took on made more sense when it was viewed as "bridging finance" so they didn't look like desperadoes trying to get a deal done before they ran out of cash. Further to that, Waislitz being the source of the leak to the AFR led me to believe that large shareholders have said "no more cash, get a deal done."
This quote from the chairman slots into this theory (I think) in that he's basically saying they are for sale, but they won't be low balled because they have enough money to negotiate. I would read this as being a message to potential suitors rather than shareholders.
