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| Subject: Profitability at the EBITDA level in the 2003year will be, to a large extent | |
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Author: Egilmore,for your assesment of impact on eps |
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Date Posted: 09:03:55 01/20/03 Mon Thank you for using the forum, Wonder Woman Your entry has now been added to the forum as follows... Name: Wonder Woman Location: Sydney, NSW Australia Date: Tuesday, January 21, 2003 at 4:01:55 AM Subject: Hi Egilmore ERG -contract/Washington-20/1/03.Recurring revenues. Comments: Hi thankyou Egilmore,for your assesment of impact on eps, Peter Fogarty has stated he does not expect to be profitable for the 03 year (depreciation and amortisation), he is deliberate in his choice of language and has not built up unrealistic expectations.He states 12/9/02 "Profitability at the EBITDA level in the 2003 year will be, to a large extent, dependent upon both the timing of signing and commencement of new projects." Washington is the Infrastructure and cards side of the business and adds to a picture emerging, where longer term recurring revenues are becoming more important than the installations side.Revenue increased significantly Infrastructure and cards for period 30/6/01 to 30/6/02 reported 12/9 audited 1/10 from 51.3m to 140m, growing 173%. The focus of the company is now the software development and backend processing components of AFC systems..In light of this, it is important to correctly analyse the way forward.In relation to the prior audited period 165.3 million in one-off write-downs and provisions in assessment,N.E. Renton Understanding the Stock Exchange BRW business library Chapter 10--Factors affecting the market prices of shares, paragraph 1029 "How realistic are the various provisions in the balnce sheet? For example, is the provision for doubtful debts either too large or too small? Setting up a provision or writing down an asset reduces the profit of the year concerned." as the company announcement section states one off. One provison for dimunition in value has been touched upon previously, (Hi Phillip, recovereability Prepayment Cards ERG--18/1/03 in Forum.) there is an itemised list of improvements. (ERG somesavings/points identified/period 30/6/02 to 31/12/02-report 11/3/03--13/1/03.) Gross margin, negative last financial year, it included the one off writedowns and provisons and was affected by this, the next result due in early February will show it improving as it moves through time, giving weight to events that have.occurred post June 30th.The company's new business model, is intended, that customers will own and pay for the infrastructure installed, this is in place for San Francisco, Sydney and Seattle.With Sydney contracted through100% controlled entity ITS (Integrated Transit Solutions) having been capitalised in past accounts, reversing an earlier decision to write it off, the effect is to increase income in absolute terms with earnings rising more than the equity further as earlier stated by outsourcing to the customer.remedying the depreciation and amortisation charges in future years. Of interest with announcement 20/1/03 is an averaging formula given for a period of 5 years.(Phone convo tax department ERG Group---answers to questions in Forum 14/1/03) A bb poster has asked a question today, quoted in inverted comma's "Does this mean ERG has to pay Northrop out of the US$4m each year as a subcontractor? And as usual ERG is talking about the contract sum but not the profit to be made after doing the labour intensive work of fulfilling the contract." Will add this to some further questions, that I'm compiling to ask of Sean Duffy of Investor Relations. Washington does have an impact on recovereabilty. in past accounts. Specifically equipment being used comes from San Francisco,"ERG will use its existing central computer processing system installed in the San Francisco Bay Area to perform these functions 20/1/03." which was part of the sum the entity paid Motorola, in it's settlement with it on the 26/2/01. Regards,--WW. [ Next Thread | Previous Thread | Next Message | Previous Message ] |