Thursday, 13 December 2007

PWK Upgrades Guidance, Project Runway Update

Pipe Networks (PWK) today upgraded guidance for the FY08 and in addition provided guidance for FY09. At its financial results announcement in September PWK announced that they expected FY08 NPAT growth of 45 - 50% and revenue in excess of $30m.

Today they gave a revenue range of between $33m - $35m and NPAT of $7.0m - $7.4m for FY08 which effectively lifts the upper end of the range given earlier to 55%.

Also for the first time the company gave guidance for FY09 of revenue between $44m - $46m and NPAT to 'eclipse' $10m. Encouragingly this is all organic growth and more to the point the numbers given reflect improved margins and profitability as the table below demonstrates.

Of course all these forecasts are off the table if Project Runway gets up and running. That is looking more and more likely given what the company said today:

PIPE Networs' Board has today provided its formal approval for the legal and financial structure of Project Runway. PIPE Networks is now in a position to execute a number of outstanding sales agreements. With these agreements in addition to commitments being finalised, the Board believes it will shortly have sufficient customer commitments to proceed with Project Runway.

Cutting through the formality PWK is basically saying that now that all the legal and financial requirements are squared away, they can concentrate on getting customers signed up. Remember PIPE management have said all along they will not proceed with the project unless they have sufficient revenue generating contracts in place.