Dear Shareholder,
Bigtincan released a response to our previous letter on 12 November. Under the heading “FY24 Free Cash Flow Positive”, the Chairman states under that “For the period ended 30 June 2024 the Company disclosed positive cash-flow of $6.2m”. Bigtincan was not “Free Cash Flow Positive” in the 2024 financial year.
That $6.2m is operating cashflow. Free cash flow — a widely used and well-defined metric in finance — is after capital expenditure, in this case mostly capitalised software development. Since the introduction of AASB16, lease payments also need to be subtracted from operating cashflow, as they now turn up in financing and investing cashflows. We’ve included the company’s first cash interest payment for good measure.
You can see appropriate free cashflow calculations in the table below:
Sources: 2024 and 2023 Annual Reports
Under the most generous of interpretations, Bigtincan consumed $8.8m of cash in 2024. Which is why the company keeps asking us for more money. In total, it has consumed $208m of cash over the past three years.
Taking it to a vote
We won’t bother responding to the rest of Bigtincan’s letter. We don’t see a public shouting match helping and would have preferred the board appoint these two well-qualified directors months ago. You can read our letter and theirs and form your own opinion as to the usefulness of the company’s “skills matrix” and what our proposed directors might bring to the boardroom. And then we can all have our say at the AGM.
If you would like to discuss anything further prior to then, please don’t hesitate to email admin@foragerfunds.com.
Kind regards,
Steve Johnson