Intermap Technologies Corp T.IMP

RE:RE:RE:RE:DRC contract was fraud

[nexuss24]

Sure, I don't mind. Let's start by answering your first few statements. 

1) 2.5M-3M Alaska - This is based on the assumption that they will expand the project again as per previous years in September? This is yet to happen though

a: In the past two years the Alaskan project has been announced on: 

May 12, 2016 (2.6M) and extension on Sept 8, 2016 (additional 1.6M).

June 5th, 2105 (2.1M) and extension on Sept 16th, 2015 (additional 1.1M). 

Both times the revenue from these contractions been realized in Q3. That's why Q3 the past two years has had the best quarters. 

Q3 2016: Mapping services $ 2.4M vs Q2 2016 Mapping services $ 0.1M
Q3 2015: Mapping services $ 3.0M vs Q2 2015 Mapping services $ 0.1M

So, there should be no reason for us not to collect on the Alaskan contract this quarter. Plus, as an added bonus this year's contract is worth 19% more than last years, and 47% more than 2015.  Additions were 1.6M in 2016, 1.1M in 2015. It would be reasonable to estimate that if we were to get an expansion it would be in the ballpark of 2M. 

Say we realized 80% of the 3.1M, you get approx 2.5M. 95-100% - you get 3-3.1M. 


2) 2-3M Asian project - Hasn't this revenue (for the most part) already gone through in Q2 or are you talking new projects/expansions?

Let's refresh and look at the news release. " provide multi-frequency, high resolution radar mapping. Intermap will conduct an airborne survey, assign accurate coordinates (orthorectified data), and produce imagery and elevation products that will support risk management, infrastructure and security applications. In addition, the Company will provide supervisors who will train, assist and monitor local personnel and operations. A milestone payment of $2.67 million is expected during the first quarter of 2017." 

The milestone payment was obviously missed in Q1 or was not fully accounted. It was clearly logged in during Q2. However, Key word here is milestone payment. Here's the definition -  A milestone payment is simply a certain % of the fee of a project that the client pays over the course of the project rather than paying 100% at the end. One rough example of a milestone payment system would be if a client payed you 30% upfront, 30% after the first draft is submitted, and 40% at project completion.

I do believe they received the first milestone payment in Q2 and hence the big jump in earnings. 

The Asian contract value was leaked online via a linkedin profile – stating the project was worth 10+ million dollars. It's since been changed to “Oversight of a large multi-million dollar Synthetic Aperture Radar (SAR) upgrade project”.  You can follow what the original discussion HERE

So, if a milestone payment of 2.6M can be achieved in a quarter and the contract is rumored to be worth 10+ then, it is reasonable to assume we may achieve a milestone payment each quarter for a total of at least 3-4 quarters. 

That's how I got 2-3M for the Asian contract.. could be more depending on their speed of completion. 

3) I'd say we are relying heavily on value added data / software and soultions to make up a larger percentage of the revenue this quarter. Would like to hear your thoughts 

a) Value data and software solutions revenue will be a variable. I believe the Asian contract is a mix of mapping and software solutions. That's why the big jump from previous quarters. We may see an increase in revenue in this category from other Asian countries since it seems the company is really targeting this area. Reason HERE

Software and solutions revenue has been stagnant at 0.3M each quarter for a while. I believe this is insitepro revenue since its a subscription based product. 

I hope that helps. 

Now, let me ask again.. why do you think Q3 earnings will be bad?