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Evome Medical Technologies Inc V.EVMT

Alternate Symbol(s):  LNDZF

Evome Medical Technologies Inc. is an international medical device company, which is focused on human performance and rehabilitative solutions. The Company’s products include Biodex Rehab product, Damar Plastics product, Mio-Guard product, Simbex services, and SDP product. Its Biodex Rehab products include Isokinetic Systems, Gait Trainer, Body-Weight Supported Training, Cycles and Ergometers, and Squat-Assist Trainer. Its Mio-Guard products include bags, cases and kits, braces, and supports, diagnostics and instruments, furniture, and equipment, padding and splinting, personal protection, sanitizers and disinfectants, and tapes and wraps. Its applications include fall risk screening and conditioning, patient-driven payment model (PDPM), wellness, sports medicine solutions, neurological involvement, safe patient handling and mobility, and senior living and rehabilitation. It offers concussion, fall screening and balance assessment and training programs.


TSXV:EVMT - Post by User

Comment by TheRock07on Aug 04, 2016 8:24am
210 Views
Post# 25109171

RE:Could Easily Raise Dividend

RE:Could Easily Raise DividendLet's look at it more quantitavely.

First, with an average loan receivables of about $17.5 million in Q1/16, Inspira generated just over $800,000 in interest and fees..

Annualized, that amount of loan receivables would generate about $3.2 million in revenues.
That is, an annual yield of a about 18% ( note that they are optimizing their portfolio ).

Based on Q1/16, operating profit would be about $1.3 million ( $327,000 times 4) or an operating profit margin of 40%.

The current payout ratio is therefore about 55% ( $800,000 div by $1.3 million).

Now, let's assume that they deploy $10 million of the $14+ million in cash currently on the balance sheet .
Annual revenue yield would be about $1.8 million which, at 40%, will generate an operating profit of about $700,000 per year.

In this scenario, annual operating profit will become $2 million ( $1.3 m + $0.7 m ) and the payout ratio drops to 40%.

A third source of operating profit will come from the new software billing subsidiary.
It has $3 million in contracted revenue to date.

Lets assume that annual operating sales increase to $6 million.

Software companies also have very high gross margins and high levels of recurring sales.

I will assume that this subsidiary will generate a 40% operating profit margin which computed to $2.4 million per year.

In this scenario, annual operating profit becomes $4.4 million and the payout ratio drops to less than 
20% of disposable cash flows.

So, there is considerable scope to permit a dividend increase in 2017.

On a per share basis, Lnd operating profit is currently  about $0.035 per share.
This will increase to $0.055 per share under scenario 2 and to about $0.12 under scenario 3.

As management states that we will deploy more of the current large cash position and as we have closed the software acquisition , Scenario 3 has a substantial probability of being met


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