Gatekeeper Systems Inc V.GSI

LD Micro Presentation

[Ciao]

It served it's purpose to give an introduciton to potential new investors. There wasn't anything in the presentation that most of us have not already heard.

There was a revenue breakdown for K-12 market vs. transist at $18M vs. $10M in 2024, Margins are about the same. The growth will come from the K-12 market (hardware upgrade and PaaS) and recurring rev has gross margins of 70%.

Beyond being spec'ed for camera systems in Alstom, CRRC, there is a 3rd one.

Let's see if we move from the discovery cycle beyond retail investors and get institutions interested. Money Mark believes so. Looking forward to his insight this Friday given he had a 1 on 1 with Doug today.

[PKwild]

I was intrigued when I heard the project funnel for transit is approximately 100m. The potential for that to increase with with Alstrom is also very interesting

[davewho]

DD I seem to recall during his presentation yesterday mentioned that Q2 would be out in a couple weeks. Why did he say that? He didn't have to say that. Was it a hint for those who were listening? If Q2 was not going to be good then why mention it at all?

[Ciao]

re-watched the presentation, here are some more tidbits of info; 1) ALE contract won by Hayden AI Hayden had performed a POC (proof of concept) project with LA Transit so they had their foot in the door, Doug considered it important that GSI was noticed and was 2nd to Hayden AI, a Silicon Valley company GSI's AI has the ability to detect vehicles entering bus lanes as well as vehicles

[davewho]

they got that LA contract by taking a haircut and having to match GSI's price proposal. That in itself is telling about how close GSI came to actually getting it. IMO

[Ciao]

Yes, forgot about that...lol. Deep pockets like Bus Patrol, companies that can afford to lose $$$

[sjlpc123]

how do you know they took a haircut?

[davewho]

the bids were made public after it was awarded. 

[RJunior22]

In the end GSI still lost out. I recall another large contract last year the company lost out to Zdaas by a measly 24 thousand dollars. There was also  talk at the time that since Zdaas was an IT company, the hardware would come from GSI. We never heard anything further. I wonder if it isn’t be better sometimes to make a smaller profit in order to win the contract.

[Ciao]

Not quite. ZDAAS purchased GSI's equipment and likely lost money on that contract given SEPTA saved (if I recall correctly) only about $20K.  Doug had to twist ZDAAS and protect GSI with favourable terms for the purchase of GSI equipment.

[RJunior22]

Thank you for the additional information. 

[davewho]

Doug said years ago he would never chase contracts just for the sake of getting the contract. He believes if you build the best product available customers will buy it and sooner or later your competition will take notice and have to buy you out. Thats his game plan and as far as I know it hasn't changed. 

[Ciao]

And you wonder how long before Bus Patrol (who we know monitor this forum), Hayden AI, or even Motorola, Siemens or Johnson Controls (when they lost out intiial SEPTA contracts to GSI) decides to make a play for a profitable growing company in a fragmented industry. Let's hope it doesn't happen too soon and when it does, it makes GSI a $B company...fulfiling Doug's goal and providing a

[ramman1]

Agreed and all good, however we are sitting at .78 , and not $ 2 .----  Let's be reasonable .  A few decent sized contracts , away from Septa, and an official rocket launch of MDC's being hooked up on contract will be the foundation for the profit land. --Hopefully the ''steel wheel'' program has started .   Market tells us we are possibly on our way

[Ciao]

Yeah, not anytime soon as the share price would have to be closer to $7 before a bid comes in at $10 to get close to the $1B valuation. If I recall correctly, Silent Witness had rev of about $60M before it was taken over.

[RJunior22]

I came across the following information about Silent Witness regarding the year ended July 1998 prior to be taken over: Revenue  -  21,689,607 EBIT  -  3,532,476 Net Income  -  2,221,907 Basic EPS  -  0.41 Assuming this is correct, the diffrence could be the lower number of shares issued. Unfortunately I could not find this information for Silent Witness.

[Ciao]

Oct 15, 2003 — The price for Silent Witness, based in Surrey, B.C., is $11.27 a share, 55 per cent above Friday's close of $7.25. The takeover was announced ... Silent Witness, founded in 1986 and based in British Columbia, has annual worldwide sales of approximately $56 million and employs about 165 people.

[RJunior22]

This makes more sense. I don't know what the 1998 takeover was all about.

[ronron]

if you want more information it was briefly discussed in the 2018 interview, bought out at $72 million so you can calculate number of outstanding shares if you have more recent (of back then) info on their  financials "Now, when Honeywell acquired Silent Witness for $72 million, they had to buy the whole company because all of their products were associated with one brand, Silent

[Ciao]

This is the from the NR for the contract, note the word "relating" "....is pleased to announce that its wholly-owned subsidiary, Gatekeeper Systems USA Inc., located in Bristol, PA, has received a purchase contract for approximately US $6.7 million (approximately CAD $9 million) to provide video and wireless data technology for transit buses and trains relating to Southeastern

[Daudau11]

Hi Ciao, How did you re-watch the conference presentation?  I missed it and I want to watch it but I can't find it on the LD Micro website. Thank you.

[Ciao]

Hey Daudau11, I recorded it (using Free Cam 8) while I was watching it.

[Daudau11]

o ok haha, thanks for quick response.  I thought they would post the presentation on LD Micro Website but so far nothing... o well.  Thanks for the recap.

[Ciao]

There was an option during the live presentation to watch on YT, so it could get uploaded. There are some LD Micro presentations from the Oct. 2023 event avail on YT.