The company that puts everyone to sleep did it again; they provided a Q1 update as part of their recent Bell Potter presentation and we all went for a nap instead of picking it up. 

After I woke up from a this restful 2 hour nap (In my bloody dreams), I picked up the update and read it quickly. 

Here’s what I found in there:

• Q1 FY24 sales orders taken are 23% higher than same time last year, driven by strong growth in Australia because of the initial commercialisation of Somfit
• The US business remains below expectations and several changes have recently been made, including the hiring of a new Vice President of Sale
• The MEG system is currently being installed at TJNU in China and as a result Q1 FY24 invoiced revenues are 115% higher than same time last year at $13.5m. Excluding the MEG sale of $4.7m Q1 FY24 invoiced revenues are 40% higher than same time last year, driven by initial Somfit sales in Australia, and a solid start to FY24 from our Asia-based business.

So we’ve got 2 good pieces of news, and one not so good piece of news. From this, we can make up:

• Despite the US challenges, the business continues to grow quite strongly.
• Management seem like a trustworthy bunch; they didn’t have to share the US update, could have easily brushed it under the carpet, but chose not to do it. I respect that. 

On the back of this knowledge, it appears quite probable that H1 could continue the trend that had started to formed in H2 of last year, and the company could be on track for some good profit growth this year. If that’s true, then the value may appear too cheap. It’s still too early to call I think, but starting to look promising I would say. 

In the mid to long-term, I think they need to nail the US distribution to really be able to transition to a different league, so it would be good to see that ship start to turn in due time. Let's see.