shaping up to be an ugly openingBid/Ask are very volatile...good luck folks. I would like to buy more, but, hard to dig into the pocket right now.
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Here are my notes from the call:
positives: order growth & revenue expansion
gross margin pressure: due to use of sub-contractors
1.3M G&A cost due to one customer going bankrupt
no shares purchased as part of NCIB
merger done; looking to focus on costs...ie. external contractors, consolidating R&D Support to lower cost centers, staff into key geographical locations
Short and Medium Term: revenue - upgrades to current customers, upsell
Long term objective....see slide 13...same message...contract coming in the first Q of 2015 YE...second contract(?) to be announced by end of 2014 calendar year.
TD's Penner: mid teens profit margins still possible; sales have grown faster than expected - COGS and R&D needs to be kept in line with industry averages; contractors = delivery folks + business development folks; Gross Margin in mid-60's by 2016 (3 yrs after acquisition)
GMP: when sustainable cash generation; consuming cash - cash positive in Sept quarter (Q4)...'cash positive' starting Q4 and going forward; gross margin - too much blah blah blah from Lucas...GMP Analyst will hammer this point in update; sales cycle is 2 years in duration;
RBC: cash flow ... payout of restructuring charges (severances) coming over the next 5-6 quarters
Canacord: EBITDA target of mid teens...expecting top line to grow substantially...will take next 12 months...some aspects can be accelerated to make up for this quarter's negative impact