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Bullboard - Stock Discussion Forum C-Com Satellite Systems Inc V.CMI

Alternate Symbol(s):  CYSNF

C-COM Satellite Systems Inc. is a global designer, developer, and manufacturer of transportable and mobile satellite-based antenna systems. It has developed an auto-acquisition controller technology for rapid antenna pointing to a satellite, enabling broadband Internet via satellite across a range of market applications worldwide, including regions unserved or underserved by terrestrial access... see more

TSXV:CMI - Post Discussion

C-Com Satellite Systems Inc > YE Results | Cash burn | PAA shipping Q4 | STOP THE DIVIDEND
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Post by FormerHedgie on Mar 26, 2024 9:22am

YE Results | Cash burn | PAA shipping Q4 | STOP THE DIVIDEND

I find the C-COM presss releases of limited use without the full financials be attached.  I had to go to SEDAR and download the AIF to get the financial statements.  For those of you won't bother, here are my thoughts.

I view the legacy C-COM operations as being relatively inconsequential as long as it remains profitable and cash isn't being consumed.  The higher margins offset lower revenues so we remained profitable. 

The most important item from AIF was the reduction of cash from 18.8M to 14.4M.  When you dig into the financial statements a little more, the 4.5M decrease in cash consisted of a 2.1M increase in inventories and a 230k decrease accounts payable.  The balance was changes in working capital items.

For me, C-COM should NOT be paying a dividend.  This is a growth oriented company (or it should be) and the company should be using its cash to maximize its product development.  The company paid 2.1M in dividends pretty consistently when it feels we are scrimping and trying to get grants to offset the development cost of the PAA which IS the future of this company.

Like so many Canadian companies, C-COM is run like a private family run business and this needs to stop.  Leslie Klein owns around a 1/3 of the company I think and the dividend disproportionately benefits his person interest.

If C-COM was growing, highly profitable and generating a tremendous amount of cash, the pay the dividend.  However, that isn't the case here.  We are progressing the PAA product at an unacceptably slow pace.

CUT THE DIVIDEND NOW!!!!!   Either spend the cash of moving the PAA product along faster or just preserve / retain the companies cash as well will definitely need this to launch the product soon.

WE ARE THE SHAREHOLDERS, lets use our shares as our voice to make sure the company does what is best for all of us.

As always, if you like this work, please like my post. 

Thanks and always happy to have feedback, comments, ideas etc...
Comment by Ciao on Mar 26, 2024 9:46am
The dividend surely benefits the CEO as you noted. Given that they should have more than enough funds to carry the company to a successful launch of their phased array antennae into commercial and profitable sales so it can carry the company, is it that critical to stop the dividend?
Comment by FormerHedgie on Mar 26, 2024 4:10pm
At first pass I get your viewpoint.  Here is how I see it. I believe that once the C-COM story becomes more broadly known by the investment community (institutiional investment community) and they see that with some very achieveable assumptions (see my previous post about the potential share price based on PAA market penetration) this stock could go from $1 to $50 there will be a massive ...more  
Comment by Ciao on Mar 26, 2024 4:15pm
I appreciate your viewpoint. My understanding is that to support rev you need about 20 to 25% of working capital. So at $30M rev, you only need $6 to 8M of working capital and currenlty CMI has about $25M. They should be rolling in solid profits at $30M to support working capital and the dividend. Even at $50M rev, they would only need about $13M in working capital. We'll need to see how this ...more