Originally Posted by
mfd
As you're aware, we don't know the details. From the link I posted earlier and subsequent interviews, we know the company was attempting to move to a more transaction-based (recurring and scaling nicely as they grow) - I don't think we know how far they got with this. We know that they have a separate agreement with McDonalds for each country they are working in (which continues to grow - they added 17 in 2018-19 and were operating in 58 countries at the last report, although it's not clear this is all with McDonalds). At the last half-year report, $7.8 million of the total $11.8 million revenue was recurring revenue (66%), and this grew at 59% vs overall revenue growth of 45%. So one way or another, they are increasing recurring revenue faster than the one-off setup and consulting costs.
Other things we know is the current CEO turned the company around and made it cash-flow positive where it was previously bleeding cash and reliant on raising capital. They had $13.6 million in the bank at last report when their total operating expenses for the half year was $10.5 million ($11.7 million revenue). They have stated "The Company does notintend to raise further capital to fund ongoing operations in the current financial year". Numbers of customers continues to grow very nicely as they start up in new countries with McDonalds. In the last 6 months they have brought on two new large customers.
I appreciate the argument that the McDonald's contract may not be a huge cash-cow, but I do not see the same existential threat that you seem to.