When Can We Expect A Profit From Silex Systems Limited (ASX:SLX)?
Silex Systems Limited (ASX:SLX) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Silex Systems Limited, a technology commercialization company, engages in the research and development, commercialization, and license of SILEX laser uranium enrichment technology in Australia. With the latest financial year loss of AU$9.5m and a trailing-twelve-month loss of AU$14m, the AU$905m market-cap company amplified its loss by moving further away from its breakeven target. As path to profitability is the topic on Silex Systems' investors mind, we've decided to gauge market sentiment. We've put together a brief outline of industry analyst expectations for the company, its year of breakeven and its implied growth rate.
Check out our latest analysis for Silex Systems
Silex Systems is bordering on breakeven, according to the 2 Australian Semiconductor analysts. They anticipate the company to incur a final loss in 2023, before generating positive profits of AU$605k in 2024. So, the company is predicted to breakeven just over a year from today. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 90%, which is extremely buoyant. Should the business grow at a slower rate, it will become profitable at a later date than expected.
We're not going to go through company-specific developments for Silex Systems given that this is a high-level summary, though, take into account that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.
Before we wrap up, there’s one aspect worth mentioning. Silex Systems currently has no debt on its balance sheet, which is rare for a loss-making growth company, which typically has high debt relative to its equity. This means that the company has been operating purely on its equity investment and has no debt burden. This aspect reduces the risk around investing in the loss-making company.
Next Steps:
There are key fundamentals of Silex Systems which are not covered in this article, but we must stress again that this is merely a basic overview. For a more comprehensive look at Silex Systems, take a look at Silex Systems' company page on Simply Wall St. We've also put together a list of pertinent aspects you should further research:
Historical Track Record: What has Silex Systems' performance been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Silex Systems' board and the CEO’s background.
Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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