Post by
TheRock07 on Feb 27, 2014 9:51am
Brazil Potential
VSI,s canadian sales are about $80 million.
With the Brazil market being more than 40 times larger, the potential market would be in excess of $3 billion.
Brazil margins will also be higher due to a somewhat different operating model.
The Canadian margin was 6.8 % in 2013.
I would suggest that the Braziilan gross margin will be at least 10 %.
VSI will also have its international market where margins are intermediate between those of Canada and Brazil.
Lets examine the suggestiion that annual sales ( gross ) in Brazil will hit $140 million within 12 to 18 months.
Gross margin would be $14 million.
Operating expenses will be less than in 2013 , so $6 million seems reasonable.
This would provide net margins of $8 million.
VSI have tax loss pools, so they wont have to pay much income tax.
In other words, net earnings above $0.10 per share are achievable should execution be successful in Brazil.
These guys have done it all before and they have the larger clients in place and under contract in Brazil.
High risk but also even higher reward.
Its always that way
Comment by
picasso1 on Mar 01, 2014 10:36pm
What has changed about the Brazilian operation? The merchant network is now larger but it will take time to develop traction especially in revenue. Vsi has been in the Brazilian market for 3 or 4 years and have little to show. I agree the potential is high but it was always high to begin with. Does your post come with a safe harbor? Lol