The first thing that you've missed is that the 6 week profit figure includes non-recurring exceptional items. There can be no certainty as to how much but there are at least £33k of non recurring exceptional items in there and possibly more. You can confirm this by reading the finals here:
which note
The Board continues to recover monies which it believes were inappropriate
expenditure; a further £33,000 was received on 19 September 2005.
To be honest personally I feel that the company has published materially misleading information by publishing the gross profit figure without explaining that it contains exceptional items. You, for example, have demonstrated how you've placed reliance upon this number and yet now you can appreciate that the number is actually materially false and misleading.
There are of course other problems with the numbers but given that they are so unreliable and are for such a short period of time it would be foolish to project them forward. Even if you could get reliable figures then how would you allow for seasonality in a business that has only just started and so has no known trends? Will it still be busy after Xmas? What provisions should be made for the inevitable credit losses that will occur?
Hence an analysis of the balance sheet is the cleanest way to proceed. A debt for equity swap is due where the market will be flooded with approx 3.5 times the existing number of shares at a price of 0.1p. Given the obvious massive impact that such an influx of new shares will have on the market then 0.1p is obviously the most sensible price to use in the short-term.
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