Most companies inside the S&P/ASX All Ordinaries Index (ASX: XAO) pushed higher on Wednesday. However, one ASX All Ords stock failed to gain traction following the release of its second-quarter activities report for FY2024.
More peculiar is that this company is coming under selling pressure despite posting a significant increase in revenue. The negative reception hints at another facet within the figures weighing on investors' minds.
As we tick past the closing bell, shares in Chrysos Corporation Ltd (ASX: C79) have shed 5.5% to $7.21. The mining technology company has had a ripper run since debuting on the ASX in 2022. However, today's report appears to have poured some cold water on the excitement.
Delays dampen a good quarter
Before we dive into the thick of it, here are several key figures from the quarter:
- Total revenue up 57% year on year to $10.1 million
- Sample volume up 29% year on year to 1 million
- Deployed PhotonAssay units up 71% year on year to 24
- Minimum monthly assay payments up 77% to $8.9 million
By no means was the second quarter a failure for this ASX All Ords stock. The company responsible for an innovative alternative to fire assays — a way of determining the concentration of minerals inside ore — is growing rapidly as it continues to roll out its testing units to customers.
Chrysos is making in-roads with major gold miners, such as Barrick Gold, an achievement highlighted by the managing director and CEO Dirk Treasure. Commenting on the noteworthiness, Treasure stated:
The second Quarter of FY24 was a significant period for Chrysos, marked by the continuing validation of our PhotonAssay technology by one of the world's largest gold miners, Barrick Gold, as well as our increased funding facility with the CBA, and the successful completion of our $75m institutional Placement, which received strong support from new and existing investors.
Yet, the enthusiasm among shareholders appears to have been pacified by a hindered outlook for FY24.
The full-year FY2024 revenue is tracking at the lower end of the originally forecasted range of $48 million to $58 million.
Furthermore, there is an 'emerging risk' of failing to achieve the company's goal of at least 18 PhotonAssay deployments in FY24. The cause is 'customer site readiness and contractor availability' challenges.
Fortunately, management expects delayed deployments to be picked up in the first quarter of FY25.
What about the valuation of this ASX All Ords stock?
Despite the rapid growth rate, there is a chance onlookers were hoping for even more.
The Chrysos share price has ascended 96% over the past year as the market potential began to resonate. As a result, the company's market capitalisation has swollen to $875 million, reflecting a forward price-to-sales (P/S) ratio of nearly 17 times, based on FY24 estimates.
It can be challenging to value any company during such a high-growth period. Sometimes, it can lead to expectations getting ahead of reality. Perhaps investors were pondering this very thought today when looking at the stock price of this ASX All Ords company.
Shares in Chrysos Corporation are now down 14% for the year.
