WANDISCO PLC (lon:wand)
WanDisco – Very Bad H1, But I Don’t Understand The Company Anyway

WANDISCO PLC Financials

ItemCurrent PeriodPrevious Period
Year20202019
Period6 Months6 Months
Revenue$4m$6m
Earnings
Adjusted Earnings
EBITDA
Adjusted EBITDA($12m)($8m)
Statutory Profit
Adjusted Profit
Total Debt$1m$2m
Net Debt
WANDISCO PLC Share Price
Grade:The Black Grade - Shares That I Think Could Collapse To Nothing Or Suffer A Massive Share Issue.
Title: WanDisco – Very Bad H1, But I Don’t Understand The Company Anyway
Company: WAND - WANDISCO PLC
Share Price Then: 497p
Author: Ian Smith
Date: Fri 18 Sep 2020
Comments: In Jun 2020 WanDisco raised $25m with an issue of new shares representing a bit over 6% of the then current number. Issued as 650p it was under a blip in the market price but around the average price over the last two years.

Currently the market cap is around $220m which seems pretty hard to understand given
YearRevenue
$m
Adj EBITDA
$m
Profit
201916.2-11.7-28.3
201817.0-9.4-19.7
201719.9-0.6-13.5
201611.4-7.5-9.3
201511.0-15.0-29.9

Currently sitting on a cash balance of $33m up from $23m seems to be enough for a year or so the company seem to have a history of previous share issues $22m December 2017, $15m June 2016, $24.8m Jan 2015, £19m Sep 2013 (£ not $).

I don’t understand what others are seeing in this company, unless like me they don’t understand it, therefore it must be deeply technical and massively profitable soon.
Read Count: 181

Buy/No Buy In A Nutshell
NegativesContinually loses money funded by share issues.
PositivesI can't see any.
Initial Review Price497p
Last Review Price497p
Last Review Date18-Sep-2020
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Share Commentaries, their purpose.

Previous Commentaries On WANDISCO PLC
Date Share Price Author Commentary
Wed 15 May 2019490pIan Smith

WANdisco – I Still Don’t Understand What It Does!



My attention is frequently drawn to Wandisco as their share price is quite volatile, but each time I look at them I don’t go any further because I can’t really pin down what it is they actually do.

Keep your data consistent across multiple cloud environments is the strap line on their web site and at a very high level it seems to make some form of sense.

It’s when you try and get into the details that it gets very confusing and buying shares in a company that you have no idea about is pretty tricky, after all everyone else may be equally confused and just trading on trends and recent good and bad news.

The Cloud is still a buzz word, but my experiences with it have not been as positive as might be expected, costs can very quickly run out of control and “half and half” solutions where you have some data in the cloud and some within the business can be very difficult to use.

A lot of this can be put aside if the company is profitable, but if you are a partner providing a service on top of someone else’s service then your product needs to keep up with theirs. This can be a massive cash drain especially if you are the smaller partner and given that cloud services are only offered by the really big boys then their partners will nearly always be smaller.

Revenue seems to have hit a bit of a plateau at around $15-$20 million a year with losses and share placings cancelling each other out.

I don’t know if the products are good or not, but the 2018 annual report said the company had 148 employees, this both a lot to pay but probably not enough to come up with something startling.

Given that the company is no longer a start-up I am having difficulty seeing the upside for me, trade volumes are very low, so even trading on days where there is good news may be risky leaving you trapped in the company.