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No. of Recommendations: 25
Notes from their H12020 conference call (they report every 6 months):

Numbers are in british pounds:
Revenue 68.5M - up 70% YoY
Income (41.4M) - 20% worse YoY
Operating Cash Flow (31.2M) - 68% worse YoY

Yikes, they are expending 160% of their revenue and leaking a lot of cash, but they have pledged to fix that in 2021:
The Board is comfortable reaffirming its commitment to reach cash break even during 2021.

Let's see where they're losing money:

£m 1H20 1H19
General & Administrative 13 12
Professional services 14 8
Sales & Marketing 56 45
Research & Development 8 4
Depreciation & amort. 3 -
Share based payments 7 3
Operating expenses 101 72

The first thing that jumps at me is that their R&D budget seems really small. Not sure how a tech company is supposed to develop their product with just a couple million pounds per year. For comparison, OKTA has got twice the number of employees but spends 5 times as much on R&D. Or another look - while PRSM S&M budget is 7 times its R&D budget, OKTA S&M budget is 2 times its R&D budget. It's probably even worse in that I think what PRSM calls "Professional services" is simply included in OKTA's S&M for the most part.

Cash and cash equivalents at the period end were £90.8m (30 April 2019: £129.4m). The Group holds a further £50.0m on deposit maturing within the next 12 months making its net cash and short-term investments position £140.8m.
The Group raised gross proceeds of £100m (before expenses) via an equity issue, in new funding in April 2020 to provide significant balance sheet headroom in the event of prolonged disruptions relating to the COVID-19 pandemic, and to enable it respond to opportunities that may arise.

This means they have enough cash for about 1,5 years of operation with the current performance, but hopefully their performance is going to get better.

So their marketing costs have risen by 32% YoY, how did their customer base grow in the same period:

1H20 1H19 YoY growth
Closing customers at period end 1,864 1,337 39%
New customer wins 255 349 -26%
Upsells during the period 635 496 28%

This is pretty bad given the size of their S&M.

They seem to be aware these results are not great and are talking about Covid-19 disruption throughout the document. They've even retracted their guidance because of it:

In response to the immediate impact of COVID-19 on growth rates, the unprecedented nature of the disruptions and the unknown timescales the Board withdrew guidance from the market in April 2020.

So maybe their performance has been hindered by the situation that's out of their hands, though the impact of Covid-19 on their particular type of business is not as clear to me - they are a software provider and those have not felt the Covid-19 impact as hard as other industries.

Some positive things:
Recurring Revenue represents 98% of their revenue
635 upsells on a customer base of 1864 is pretty good. Looks like customers like their product.
Operating cash outflow reduced from 2H19
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