A slightly better quarter. Livetiles is still alive.

Cash collections up slightly to $9,990 - up over last quarter but well below last year.

LiveTiles recorded operating cash outflow of $2.98M during the quarter, with $2.66M of this attributed to one-off, non-recurring costs that have now been removed from the business post the Operational Review announced on 27 October 2022. 

Even with these reductions, LVT is still negative cash flow.

Staff costs and admin costs are rising, probably due to inflation but could be redundancies.

They are pinning a lot of hope on My Net Zero "a revenue target of $25 million over three years". Is that pie in the sky or a real chance to get them to break even? Time will tell.

No mention of the BTC offer (or any takeover prospects) this quarter.

No mention of the ARR number or revenue for the quarter which is disappointing.

FY22 full year results are out.

Half-on-half results are very consistent. Revenue slightly down. Expenses slightly down. PBT down from $1.8M positive to $1.75M negative in H2 but that's mainly due to the dodgy "contingent consideration movement" that added $4M in H1. Looks very steady or slightly improving bottom line (but still slightly negative).

Free cash flow deteriorated from negative $2M to neg $3M mainly due to declining receipts from customers, down from H1 $30M to H2 $26.7M. Given how steady revenue was, there is either a major timing difference in receipts or a blow-out in uncollected debts. There is no breakdown or explanation of their receivables and I couldn't find anything on uncollected debts in the annual report. That's a big red flag for me.

Of course the major issue is their impending de-listing. If the current share price was a real bargain it may be worth holding on. It isn't.

LVT results continue to underwhelm based on the Q4 4C.

Yes, cash flow can be lumpy and depends on customers terms and when they pay. And if they pay. Apparently $1.7m was overdue at June 30 (remember that if next quarter looks good). Potentially some customers will never pay so I'll be looking carefully at receivables and bad debts in the annual report.

But even revenue is down half-on-half. The 4C mentions unaudited FY revenue of $52.8m: H1 $26.7m, H2 $26.1m

Last thing to mention is that cash expenses are up slightly QoQ. They need ARR / Revenue to be at least keeping pace with inflation because for sure their staff costs are going up.

All indications from this 4C are that they are going backwards.

Pretty lukewarm 4C from LiveTiles today. A mere 9% YoY ARR growth is poor at best for a company spending on development and acquisitions. ARR was down on prior quarter which they attribute to exchange rates. Your growth must be pretty anaemic if it gets lost in a small movement of the dollar. Likewise, the 14% YoY increase in cash receipts is not a whole lot better than inflation and actually down on the previous quarter (which they don’t mention). But cash receipts can be lumpy so who knows.

There were a few good wins in the quarter, at least in terms of seats, and, depending on the timing, these may turn into cash next quarter. Likewise, the acquisition of The Human Link on 31 March should contribute about half a million per qtr from next quarter.

Like many SaaS companies, the question remains, can it ever be profitable? If they cut costs in sales, marketing and development, can they win and retain customers? Or is it just a shell game of spending shareholder money on acquisitions to buy growth and distract from the failure to sell their core product?

On the day of this tepid missive, the SP closed flat at 8.5c, despite the market rebounding 1.3%

The Dec half yearly looked good BUT digging into the notes, there are a few concerning things.

1. They've taken as profit nearly $4M of "Fair value movement in contingent consideration". More on that later.
2. They've changed their policy on capitalising and amortising development costs. In previous statements their amortisation exactly matched their capitalisation. In this half, they capitalised $2.39M and wrote off only 0.17M, adding another $2.2M to the bottom line. Make sure to reduce their operating cash flow by that amount too.
3. Poor investment - nearly $1m for 20% of My Net Zero, headed by their former CMO. How did the board approve that?
4. Latest 4C would look good, except for $1.38M in back taxes. How did that happen. Sloppy or dodgy? What will come out and bite shareholders next time?

There are a few positives in the half yearly. Revenue is up a bit, trade receivable are down so DSO reduces to 47 days and the provision for bad debts is down a bit.

But back to that contingent consideration. Did they deliberately overstate the earn out? Did their purchase not meet expectations? Some on HC claim it's because their share price was down but I'm sceptical. Would an earn-out be expressed in shares instead of dollars? More likely the reference to VWAP means the vendor got more shares for the dollars they were entitled to, so it's back to under-performing or over-provisioning, both bad.

Do their acquisitions add value? Or do they temporarily add some revenue so that it looks like they're growing, when the truth is high customer churn. Better to pay from the "investing" section of the cash flow for some new revenue rather than investing in sales and marketing and customer support from the operating section.

If I were a shareholder, I'd be using the price spike (13.5c today) to get the hell out.