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Last edited a month ago
#Risks

20 Jan 20: 2Q20 4C.  Rec $1.4m; CFO $492k; FCF $507; Cash $619k; Debt $500k.

First FCF positive quarter, though receipts from 1Q were carried over into 2Q.  Will need to see the 3Q20 and if it is FCF positive again then it would be a significant positive for SCT.

9 Jan 20: 4Cs have been disappointing in FY19 with FCF positive not being achieved and with low levels of cash.  Risks have increased.  Increasing debt to cover the negative cash flow.  May need to raise capital soon if they can't access debt. Next 4C will be critical as well as monetising their partnerships with large multinational security companies (Stanley; Protegur)

1Q20: Rec 405; CFO -742; FCF -742; Cash 122; Debt 500

4Q19: Rec 754; CFO -748; FCF -748; Cash 371

3Q19: Rec 1,067; CFO -1,164; FCF -1,164; Cash 1,126

2Q19: Rec 781; CFO -832; FCF -832; Cash 2,797

1Q19    Rec 962; CFO -181; CFI 0; CFF 575 (Issues 75; Borrowings 500); Cash 664
4Q18    Rec 602; CFO -677; CFI 0; CFF 0; Cash 271
3Q18    Rec 405; CFO -857; CFI 0; CFF -10; Cash 948
2Q18    Rec 318; CFO -2,674; CFI 0; CFF 1,494 (Issues 1,600); Cash 1,815
 

 
Last edited 2 months ago
#Management

There has been significant director purchases.

In 2019 Brown has bought +$90k
In 2018 Brown has bought +$171,493

10 Dec 19: Brown +24,768 for $1,485 @ 6.0c (2.75m)

18 Nov 19: Brown +54,545 for $3,462 @ 6.35 (2.72m)

27 May 19Brown+27,000; $2,971

20 May 19Brown+145,000; $15,819

17 Apr 19 Brown+30,000; $3,750

28 Mar 19 Brown+30,000; $4,615

11 Mar 19 Brown+270,000; $37,697

5 Feb 19 Brown+29,032; $4,599

2 Jan 19: Brown +100,000 for $15,934 (2.14m) @ 15.9c


24 Dec 18: Brown +100,000 for $16,554 (2.04m) @ 16.6c
17 Aug 18: Brown +100,000 for $15,174; +250,000 for $75,000 - $0.30 (1.94m)
6 Apr 18: Brown +56,435 for $9,060 (1.59m) @ 16.1c
8 Mar 18: Brown +100,000 for $16,705 (1.53m) @ 16.7c
14 Feb 18: Brown 100,000 for $21,000 & 100,000 for $18,000 (1.43m) @ 21c & 18c
 

 
Last edited a month ago
#Bull Case

 

20 Jan 20: 2Q20 - first 4C FCF positive quarter.

9 Jan 20:  Risks in the business has increased as Revenue has not met expectations.

  • DIY Security Systems sold in Walmart
  • Orders from industry giants such as Stanley
  • Placement of share to Prosegur at $0.275 to provide the funds they need until they approach CF breakeven.  
  • Good growth in sales. 
  • Director buying (More than $85,000 by one director - Brown)
 
Last edited a month ago
#Industry/competitors

a. DIY Security (Direct)
b. Traditional Security (Indirect) - markefly different from Scout in that they use legacy technology, utilise in-home installers, enforce multi-year contracts and have large all-in costs to the user
c. Home Automation Platforms (Indirect) 
d. Home Monitoring (Indirect) 
 

 
Last edited a month ago
#Business Model/Strategy

17 Jan 20: Partnering with large multinational security companies.

Self-installed, wireless home security system that is primarily controlled through a user’s smartphone.

Scout products can be differentiated from those of its competitors as the hardware and software components of its products have been developed simultaneously from the ground up, resulting in seamless connection between the various components and a simple operating system.

Selling home security systems
Recurring monthly monitoring subscriptions
The recurring revenue and software platform is what will drive the value of Scout’s business over time.
Cellular backup subscription plan for US$9.99 per month and a 24/7 police dispatch subscription for US$19.99 per month.
Need the subscription plan to be able to control the alarm system through their phone.
Average hardware order is US$420.  
    Scout hub US$129
    Scout Door Panels US$69
    Scout Motion Sensor US$49
    Scout Access Sensor US29