H2O Innovation Ord Shs V.HEO

Assessment

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I requested an update from 5iResearch as there had been a lot of developments since they had last commented on HEO about 6 months ago when they weren't  particularly enthusiastic. While they have the normal concerns about its small size and debt, they agreed that the company is certainly acting better. Revenue was up 11% in the last quarter and more important, margins were improving. They initially reduced salaries by 10% but later reduced this to 5% which is a positive sign as the decline in business was less than initially forecast. There has also been increased insider buying along with these good numbers so it has definitely moved up a few notches in their estimation. GLTA