Kleos Space S.A.'s (ASX:KSS) Shift From Loss To Profit

With the business potentially at an important milestone, we thought we'd take a closer look at Kleos Space S.A.'s (ASX:KSS) future prospects. Kleos Space S.A., together with its subsidiaries, engages in the development of the space enabled, activity-based intelligence, and data-as-a-service (DaaS) products in Luxembourg and internationally. With the latest financial year loss of €6.4m and a trailing-twelve-month loss of €5.6m, the AU$59m market-cap company alleviated its loss by moving closer towards its target of breakeven. Many investors are wondering about the rate at which Kleos Space will turn a profit, with the big question being “when will the company breakeven?” Below we will provide a high-level summary of the industry analysts’ expectations for the company.

Check out our latest analysis for Kleos Space

Expectations from some of the Australian Professional Services analysts is that Kleos Space is on the verge of breakeven. They anticipate the company to incur a final loss in 2023, before generating positive profits of €2.0m in 2024. So, the company is predicted to breakeven approximately 2 years from now. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 81% is expected, 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 Kleos Space given that this is a high-level summary, though, bear in mind that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we’d like to point out is that The company has managed its capital prudently, with debt making up 1.5% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.

Next Steps:

There are key fundamentals of Kleos Space 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 Kleos Space, take a look at Kleos Space's company page on Simply Wall St. We've also compiled a list of relevant factors you should further examine:

1. Valuation: What is Kleos Space worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Kleos Space is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Kleos Space’s board and the CEO’s background.
3. 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.

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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.