Glentel Inc GLNIF

What's Wrong with This Picture?

[Waterboy4]

Just reviewed the GLN numbers for 2011 and I have to say I am a little concerned. A $171 million dollar increase in sales only produced 9.3 million gain in income and $5.3 million in net income. That does not look positive at all. Perhaps they have reached a critical mass on the retail side. There is no actual report yet but I will be even more concerned if the increases are solely attributed to new store openings. I see the market doesn't much like it either down 11%.

[m1ax]

It's disappointing, but I would not worry at this time. Wait for the report and read it; you probably will have a better understanding of what's going on.

[shogun8]

The lower earnings  stems from  Wireless Etc's 4th quarter, which was hurt when they lost the ability to sell the iPhone. This product loss will affect earnings going forward unless they can negotiate a solution betwwen Apple/Costco.

[m1ax]

Down again today. I would not say that the stock was priced for perfection, but expectations were high. Nothing, IMO, that a few good quarters can't fix.

[jsbarnby]

At $22.00 if they delivered the expected earnings the P/E would have been 14.86. At $18.00 with the earnings that they delivered of .43 we are sitting at a P/E of 13.64. Theoretically, the stock should stop it's freefall but who knows what Mr. Market does. If the stock falls much further I may look into adding to my position...

[segltech]

Can Glentel sell Apple products at any of their locations?

[segltech]

Sorry, question should have been - Can Glentel sell Apple products at any of the Costco locations?

[jsbarnby]

No..not in 2011. This is where the disconnect was between earnings projections and actual earnings. I think analysts got it wrong when putting together projections. I talked with Investor Relations at Glentel and they told me that this was the biggest reason why earnings came in below what was expected. Having low iphone4s sales during the holiday season Glentel did not hit a lot of their sales

[porksniffer]

Thanks for the update js. So you're telling me that the iPhone was avaliable at Costco stores throughout the year but was not being sold in the 4th quarter? I find it hard to believe one phone not available in a 1/3rd of their stores was soley responsible for such a huge miss. Not sure we are getting the whole story here but I get the feeling being able to buy a phone in grocery stores

[jsbarnby]

No. The way I understood it was that Apple products are not sold in Costco stores at all in 2011. This was what was largely responsible for the miss but investor relations also said December was a slower than expected month. The macstation expansion will be allowed to go but they will restrict themselves to niche areas. Glentel won't be competing in massive shopping malls with Apple but will

[porksniffer]

So if they were not sold in Costco all of 2011 why is it an issue suddenly in the 4th quarter? The previous 4 quarters were great regardless of Apple products not sold at Costco. It looks like competition is starting to affect them. I am also struggling with this name. On one hand we have the potential with the Macstation expansion and on the other hand it's quite clear they need continious

[Waterboy4]

Well I was hoping for an explanation but there is little in the MD&A that would calm investors on such a huge miss in Q4. All if not all of the growth is attributed to new store openings. It seems that the market also sees through the smokescreen. 26% drop in share price is concerning for any company but it is even worse when a company is controlled by one family. One assumes they are not