IKE - IKE GPS Group

[Buzz]

Thank for sharing @untamed. Do you know whether anyone has asked when IKE expect to be profitable? This is the only thing stopping be taking up a position.

[Left Field]

Thank for sharing @untamed. Do you know whether anyone has asked when IKE expect to be profitable? This is the only thing stopping be taking up a position.

See post 160 point #2.... this comment from the CFO.

[Untamed]

Thank for sharing @untamed. Do you know whether anyone has asked when IKE expect to be profitable? This is the only thing stopping be taking up a position.

I didn't ask that question, but others may have. To be honest, I still struggle to get my head around financial reporting/fundamentals. You would have a far better understanding of that than I ever will. It was mentioned in the presentation that they expect to be EBIT positive 2H FY25. I realise that doesn't necessarily mean "profitable" but it feels like progress to me.

I don't know how long we will have to wait to see "profitable" but I have no doubt whatsoever that it is coming. I am happy to sit on what I have (and may even add some when I am able) because I honestly cannot see this company failing. They are so well positioned right now, and they clearly know their market and what that market wants from them. They are my Mainland Cheese holding - good things take time. They would have to royally f**k up, to fall over. I cannot see them ever doing that. They have their finger on the pulse of the North American market, and my gut instinct tells me they know exactly what they are doing.

[Buzz]

See post 160 point #2.... this comment from the CFO.

Thanks, I did see that, but the number I'm looking for is not EBIT+, it NPAT+. Anyway, the next few months next reporting will be important.

[Greekwatchdog]

For Bars Review
IKE reported a solid 1Q25 trading update, with the outlook for FY25 remaining positive. While total revenue for the quarter was slightly behind our expectations, sales momentum in Subscriptions continued, as segment revenue rose +29%. IKE's gross margin expanded to 70% in 1Q25 from 61% in 1Q24, reflecting a favourable shift in the product mix towards higher-margin Subscription revenue. The positive trend in margin is expected to continue for FY25, implying stronger-than-anticipated gross margins, relative to our prior expectation of ~69% for the period. We adjust our estimates accordingly and our blended spot valuation increases +5cps to NZ$0.88. IKE had NZ$10.0m in cash at the end of 1Q25, which we expect will be sufficient to achieve cash flow breakeven without external capital.

What's changed?
Earnings: Our EBITDA estimates increase by +NZ$0.3m, +NZ$0.5m, and +NZ$0.5m in FY25, FY26, and FY27 respectively.
Blended spot valuation: Rises +6% to NZ$0.88, reflecting earnings changes and a re-rating in peer multiples.
Segment revenue trends persist
Total revenue for 1Q25 (NZ$5.8m) was slightly behind our expectation of NZ$6.0m, largely reflecting continued weakness in IKE's Transaction segment. Transaction revenue was NZ$1.8m, down -16% versus the pcp and -18% sequentially from 4Q24. By contrast, Subscription revenue grew by +29% versus the pcp and +14% sequentially from 4Q24, underpinned by the continued growth of IKE's core IKE Office Pro product and contract wins for its next-generation PoleForeman product. IKE now has 58 customers for its PoleForeman product, representing >3,700 subscribers and >NZ$12m in total contract value signed.

Positive outlook for the remainder of FY25
The outlook for the remainder of FY25 is positive for IKE due to: (1) strong growth expectations for Subscriptions, with management reiterating guidance for >+50% revenue growth, (2) further gross margin uplift from the continued shift in the product mix towards higher-margin Subscription revenue, and (3) the introduction of new AI capability into IKE's new and existing products. These factors should lay the platform for IKE to return to sustainable growth after a challenging FY24 period.

Cash position largely unchanged
IKE finished 1Q25 with NZ$10.0m of cash, down slightly from NZ$10.2m at the end of FY24. The moderate level of cash burn in the quarter is constructive to our view that IKE will achieve cash flow breakeven without requiring external capital. Based on our new forecasts, we expect IKE to achieve EBITDA breakeven in FY26 and cash flow breakeven in FY27, supported by continued revenue growth and gross margin expansion.

Earnings revisions
We make minor upwards revisions to our gross profit estimates following IKE's 1Q25 trading update. Our revenue and operating expense estimates are unchanged, with limited information in the 1Q25 release to change our view.

[BlackPeter]

Thanks, I did see that, but the number I'm looking for is not EBIT+, it NPAT+. Anyway, the next few months next reporting will be important.

Should be common sense, but unfortunately it turns out that common sense is not that common after all ;

Anyway - while they made some statements re EBIT and cashflow ... I haven't heard them talking about NPAT. FWIIW - analyst consensus for them is to stop writing losses only in FY 2027 (twenty twenty-seven), which is obviously still some time to go. In this context I am not quite sure how they are going to get there without a further CapRise ... but hey, we will see.

[Untamed]

Should be common sense, but unfortunately it turns out that common sense is not that common after all ;

Anyway - while they made some statements re EBIT and cashflow ... I haven't heard them talking about NPAT. FWIIW - analyst consensus for them is to stop writing losses only in FY 2027 (twenty twenty-seven), which is obviously still some time to go. In this context I am not quite sure how they are going to get there without a further CapRise ... but hey, we will see.

Sometimes we investors need to be proactive in getting the answers we seek. I'm not suggesting we all email Glenn directly. I think it was commendable that he responded to me so quickly yesterday, and was willing to address my questions, but it is probably best to use the investor related email address initially, and email Glenn if/when, we don't get what we need.

ir@ikegps.com

You have nothing to lose by asking the question.

[Greekwatchdog]

Well that jump is unexpected on large volume. Are we missing something?

[Untamed]

 

Well that jump is unexpected on large volume. Are we missing something?

No, but I bought a few more just before the price jumped, so I am happy. Glenn's response to my questions clarified a few things for me, especially with regard to transaction revenue. I think the current market optimism has simply given holders a bit more confidence to add some while they can.

If I had the money, I would buy more.

[Left Field]

Well that jump is unexpected on large volume. Are we missing something?

Potential takeover?  Whatever it is my portfolio loves it!!

[Untamed]

Potential takeover?  Whatever it is my portfolio loves it!!

Better not be! That would really piss me off. I'm in this for the long term reward. I can't see them entertaining a takeover - this is their "baby" and they will want to see it to fruition too. Hopefully holders feel the same way.

[Left Field]

Better not be! That would really piss me off. I'm in this for the long term reward. I can't see them entertaining a takeover - this is their "baby" and they will want to see it to fruition too. Hopefully holders feel the same way.

Agree......

(mind you if they are talking ARV and WHS levels at $1.70 and that would help lessen my concerns! (lol))

Whatever.....  today's SP gain a great endorsement and it is onwards and upwards for IKE from here.

[Ennui]

This is my OCA lol.
Average buy in price for me must be 75-80 cents. Watched it soar to $1.10 ish and held all the way down. Contemplated offloading last week due to lots of other opportunities out there at the moment, glad I didn't.

[Minimoke]

After todays suprise price / volume action, time for a chart

You cannot view this attachment.

Edit. Someone is definitely accumulating. There goes another 150,000 shares swapping hands.

[Minimoke]

Interesting. Sellers have basically dried up. Only 2 (@0.60). Against 20 buying bids