This morning KME published the AGM presentation as a generic announcement.

It did have Q1 FY24 updates and FY24 guidance - I am not sure why it wasn't a price-sensitive announcement.

Q1 FY24 Highlights

1. Revenue grew by 20%
2. Student numbers up 4%
3. Lesson numbers up 5%
4. Tutorfly revenue 0.433m for Q1 ( up from 0.068m)
5. New opportunities in California, Maryland, and NJ
6. Contracted services reached 3m for FY24 ( up from 2.6m at the end of FY23)
7. Established partnerships with 14 school districts ( up from 11 at the end of FY23)
8. Expanded presence to 10 states ( up from 7 at the end of FY23)
9. 7% increase in Customer Lifetime value
10. fee increases
11. increasing tutoring weeks per year
12. Corporate Center
13. Increase 6 corporate centers in first quarter
14. Total 35 corporate Quartner ( up from 29 at the end of FY23)
15. US Expansion
16. New US center to open by March 2024 in Frisco, Texas
17. Investments Continue
18. Buying back Corporate Center + US expansion will impact half-year results

There was no option to join AGM online so no idea what was discussed.

It seems like the company is increasing revenue and growing but also increasing investment at the same pace - It comes down to, do you have trust in the Management that the investment it is doing is effective or burning cash.

Don't think issue is of alignment - as Storm has significant personal wealth tied to the business...so questions just come down to his skill and ego etc. -- Your guess is as good as mine -- Revenue is growing so hopefully at some stage he will stop investment and cash will flow... or AI will eat its business ??

I like the progress KME is making so will keep on holding..

KME Reported its FY23 report and the share price has gone downhill ( i.e no change after the result as it was going downhill before the result as well)

It seems that the market didn't like that NPAT has gone 29% down or it didn't like that revenue only increased by 9.2%.

Yes, the result wasn't great but to my eyes, It wasn't bad at all compared to what I was expecting or fearing that inflation will seriously hamper its tuition numbers.

Some of the bright spots in the results for me

• The corporate business continues to scale and has achieved profitability for the first time
• May be market didn't like the cashflow shown but the underlying net cash flow from operations was $3.1M
• Cash flow from operations this half was affected by $2.3M in outflows to franchisees
• Revenue from Franchise fees and Student lessons are trending in the right direction
• 
• Revenue performance was hampered by UK/Europe and the USA. Now I have noticed the trend that most of the reported companies had issues gaining growth momentum in UK/Europe in this period and for USA, KME is saying that there were some delays with Tutorfly Director comments as below:

• " We have contracts in place for the second half to see revenue return to last year’s levels for the full year and are now working with 4 school districts up from 1. We have also developed a new revenue stream for ‘drop-in tutoring.’ Currently, in use at one school district, a click button provides an instant help feature. We believe this new service for drop-in tutoring provides an exciting new business opportunity more widely throughout all operations"
• 

So in nutshell, Yes company didn't had a great half but I think it has been punished way more than it should ( in my opinion - anyway) probably illiquid nature has to do with it. Hopefully, the same illiquidity will at some point act in shareholder's favor - I shall wait for such time.

Turning into a bit of a serial disappointer unfortunately.

The market saw this kind of tepid result coming months ago, with the price at 52-week lows well before the report came out.

Safe to safe this half did not meet expectations. It looks like Tutorfly is losing quite a bit as they supposedly invest for growth. I imagine this will not be looked on favourably by the market - at least KME has already fallen a lot. Not sure whether there will be something more positive in the investment presentation yet to be released but there has been a lot of investment and not much to show for it.

Currently a lot is resting on the second half - Storm and KME would be testing a lot of people's patience.

Looks to be a fair amount of consistent volume (compared to history - still illiquid) going through KME over the last few weeks. Wonder who is buying and who is selling.

16/11/21 AGM Presentation to Shareholders

No major surprises from the KME AGM held a couple of weeks ago. A few points I took out:

Management confirmed that after the investment in the executive team and head office in FY21 those costs will remain flat in FY22 meaning growth in Corporate centre revenues should scale nicely.

Corporate revenue currently run-rating about $8m more than 100% growth on $3.5m in FY21.

The Tutorfly office will be the launch pad for US expansion in FY23.

Covid continues to affect the business with 503 active centres compared to 537 at the end of FY21. Worth monitoring if these centres return when restrictions are lifted.

Despite that, lessons were up 8% and revenue up 21% (as Corporate revenue grows and captures a bigger percentage of the lesson fee). Management have five centres ready to purchase early next year.