Company News: TZ Limited and Paragon Care
TZ Limited released its Q3 report (period ending 31-Mar-18). The report showed progress is being made to improve the operational and financial performance of the business, including increased focus on projects and contracts that provide strong margins.
Revenue for the quarter was $2.5m ($8.4m FYTD), with a 53% gross margin. Net cash flow was +$1.2m, assisted by new project deposits. TZ is anticipating a strong end to the financial year, with a backlog of orders due for delivery in May and June, and new orders coming in currently with June deployments anticipated.
Paragon Care released an update regarding trading conditions it is experiencing, and recent acquisitions it has made. The company reaffirmed guidance for FY-18 (which confirms the higher earnings expected in H2 [vs H1], is on track. Paragon’s earnings are seasonal, with about 1/3 of business in Q4.).
The company conducted a capital raising (which we participate in on your behalf) in Feb-18. This was to assist with the funding of nine acquisitions. Seven of the nine acquisitions are now settled or under binding contract awaiting settlement. The other two are expected to close before 30-Jun-18. These acquisitions are expected to deliver 20% plus EPS accretion for Paragon’s shareholders – a good outcome, especially considering there are considerably more shares on issue after the raising.