OneSoft Solutions Inc Quick Update - $OSS.v
Update after releasing Q1 2023 Financials
Continuing on with the quick and dirty daily update….
Ticker: OSS.v
Price: $0.49 CAD
Market Cap: 59 mil CAD
Enterprise Value: 54 mil CAD
OneSoft reported Q1 2023 a couple days ago. Their MD&A is pretty much the most detailed for any company listed on the Canadian venture exchange, so I would recommend reading it regardless of your level of interest.
Highlights:
Revenue was up 72% to 2.2 mil
Organic growth of over 40% depending in if you include FX swings
Gross Profit was 1.6 mil CAD
They expect to exit 2023 with about 4 mil in cash, so much less burn as they scale from here
They are expecting revenue from the Internal Corrosion module this year that they recently released
They are developing the External Corrosion module now
They are also working on the Crack module as well as the Risk module
The Crack module will be ready in 2023
The Risk module includes risk models obtained in the C-FER acquisition
2023 Guidance
They expect to exceed 10.1 mil CAD in revenue in 2023 (up from 6.9 mil in 2022). This includes 0.9 mil in expected new customer contracts in the current calendar year. They are guiding for 7.6 mil in gross profit and to be more or less adj ebitda break even for the year. They are a pretty conservative bunch, so giving guidance means they really feel confident in the revenue growth this year.
In the MD&A they disclose how much revenue they are expecting from their CIM product.
Though they have eclipsed the initial revenue per mile I was expecting several years ago, it came with the added investment in additional modules.
Closing Thoughts
OSS has been the company to teach me the most about patience. Though it is a far cry from the patience I’ve had thrust upon me from parenting, OSS has definitely given me some grey hairs. I still like the company here. They are constantly expanding their product to keep ahead of competition. I don’t think what they have developed can be easily replicated and do think at some point they get acquired. The company trades at about 5x EV/guided 2023 sales. I know, I know, revenue multiples are dead.
I continue to hold and am looking forward to becoming sensei level at patience.
Thanks,
Dean