RE:Latest.....UrtheCast's US$65M Contract AmendedRefrac1 wrote:
GlobeinvestorGOLD.com Company News Alert for UrtheCast Corp.
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UrtheCast's US$65M Contract Amended so that Entire Amount now for Engineering Services
Canada NewsWire
VANCOUVER, April 28, 2016 /CNW/ - UrtheCast Corp. (TSX:UR) ("UrtheCast" or the "Company") today announces that it has reached an agreement with its customer on the previously announced US$65 million contract to re-allocate all of the funds previously earmarked for future data purchases, to engineering services. With the amendment, the entire US$65 million contract is now for engineering services. This amendment will increase the monthly revenues of the Company beginning in mid-2016 to early-2018.
"This amendment confirms both our previously announced guidance and the main aspects of UrtheCast's story today," explains UrtheCast President and Chief Executive Officer, Wade Larson. "We have a solid, rapidly growing, and profitable core business in Earth Observation and Engineering Services, with a strong cash position. Also, as this contract is with an OptiSAR Constellation MOU partner, we feel that it signifies strong customer validation for the future of the technology that we are developing and, we strongly believe, the global commercial potential of the Constellation itself."
This contract was first signed in November 2014. At that point a significant amount of the contract was going to
engineering services anyways. I do not think this NR is positive or negative, it is simply irrelevant.
If there is a sliver of positive news it is only that Wade is affirming guidance in a very roundabout way.
From the November 2014 PR:
"A significant proportion of the contract's value will be allocated for engineering and value-added services, to be provided by UrtheCast over the first three years of the contract term. As previously disclosed in the Company's 2014 Q2 results, the conditions of the contract provide for the payment of a cash advance in the amount of 20% of the total contract value, in addition to a letter of credit for the balance of payments."
[url=https://https://www.prnewswire.com/news-releases/urthecast-signs-contract-for-65-million-to-provide-value-added-services-and-data-283719041.html]November 2014 PR[/url]