Qsolar Ltd. QSLRF

MD&A for March 31st Quarter

[mercurysmith]

The recent MD&A on Sedar may be misunderstood by some.  As expected, the Dec 31, 2013 year end numbers were bad (revenue down from $1.7m to $.3m and gross profit down from $.3m to $1.4m) due to the EU trade tariffs.  That was old news.  The new news is the quarterly report ending March 31, 2014 relative to the Dec 31, 2013 (revenue up from $13K to $329K and net loss down from $2.7m to $.6m and cash remaining at $1.8m).  

Revenue and profit/loss are definitely improving this quarter, but the bigger value in this company currently is not in production, but rather in promoting its superior technology.  The revenue will follow once the proper product exists.  Q believes they have that product now.  Confirmation of this being the proper product is hopefully just around the corner in late June with the UL certification.  

The sudden downward pressure on the s/p today is perplexing given there is no new material change news justifying it.  One would hope there is no material news that isn't being properly disclosed.  I think the simple answer is four fold: first, a delayed reaction to the anual financials  second, an undervaluing of the quarterly financials, third, insufficient value being given to the upcoming certifications, and four, Q has such a small market cap that one or two people can significantly change the s/p for any given week.  Canaccord must now be licking their chops with anticipated opportunity.