Wednesday, 23 January 2019

It's January, And Peak Is Already Half Way To Its $9 Million Revenue Forecast For 2019

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Peak Positioning Technologies (PKKFF) (PKK.C) announced this morning an update to its ASCS operations. 232 loans worth a combined CAD$17.8M in value were transferred from Wenyi. In the second paragraph in the release about the $1 billion in loans announced on Monday, ASCS receives a service fee of 6% to 8% annually on the amount of the loans it services payable on a monthly basis.

It's not completely clear by the construction of the release, but having talked with management, I believe that all loans serviced under the ASCS subsidiary originating from Wenyi's business or connections will be subject to this rate. Assuming this is correct, ASCS will be earning between $1 million and $1.4 million through servicing these loans. Add in the $750,000 per quarter or $3 million per year from ASFC and Peak will have confirmed over $4 million in revenue, just by operating at the status quo. That doesn't include a penny earned from the $1 billion loan agreement, which can reasonably be expected to generate well over $10 million in revenue this year with just a partial fulfillment. The $9 million revenue forecast for 2019 should be easily beaten.

As far as Q1 is concerned, revenue should be over the $1 million mark. $750,000 from ASFC plus $250,000 or so from the newly transferred Wenyi business that will cover 80% of the quarter. Not including any other goodies the company will have for us.

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