RE:RE:RE:RE:Risk / rewardNorwood,
LTE is not particularly capitlal intensive for a co. that definitely engages in a lot of construction -type activities. While I am sure there is more capital to be spent in the UK, capital spending was merely $1.2m from Sept 16 to Mar 17, which encompasses the entire period that they decided to move to the UK.
Now given the head count was just 50 at the end of March 2017, it is safe to assume there is more capital spending coming...however given that the HC WAS 50, and they only spent $1.2m, that's rather interesting and also makes my point. So if (or when as I prefer to think about it) the revenues are large enough, yes we'll see a "$35m on cost of sales" but its not like we need to spent $35 million on infrastructure and equipment up front.
Q2 results are not good, there is not other way to paint it and this along w/ disappointment in not getting any news yet on any UK activities (read: contract wins) has caused the drop from $3.70 to $2.00. $3.70 was a speculative run or excess in hindsight, given the lack of news (20/20 and all).
In Q2, they lost $1.9 million allthough we should point out that $900k was non cash stock comp (exercie price near the 52 week high at least). YTD we've lost $2.2 million on sales of $3.6m and down from last year's breakthrough $7.7m. Yep the financial resutlts are not good but that is different from the progress on the ground in the UK which looks very good. We just aren't there yet.
We raised $20m and we didn't do it to be someone's subcontractor, I'm pretty sure about that. Maybe they are throwing good money after bad by hiring 50 people without a contract directly w/ a Virgin or BT or other telecom co. I could be right or I could be wrong but I believe they are in a great position to get this. And the deals need to be large or lead to large ones to accomplish the goal. There are an abundance of doubters such as kidl, which is the other reason some have exited adding to the sell off.
P.S. they head count is now 70.