investor update , page-77

"How much time is required to approve/sign off the final paper work - especially when the main client is also part of the Government? Not much, in my view."

LOL!! Somebody has NFI how governments work!!

Vintage, mostly I agree with what you're saying. Everything is basically on track, some good results included in the release today, no negative surprises. So I'm quite happy with the news.


However, my view on Mexico is that SBN no longer has any idea what's happening. That's why they just limited the "Mexico" section in the reporting to one, vague sentence. Could come tomorrow, but could take another year.

That's OK, it's only one of several avenues they are chasing, and I'd rather see them chase several rather than hang everything on one option which may, or may not work out.

On China, sure the trials will be complete by March, but then there will need to be reports written, and recommendations made, and plans made for implementation, and eventually they get around to ordering some product. I agree that the START of the orders will be anytime between July and December 2009, but what I said was that significant sales (i.e. sales of 1 million units) will be at least 12 months away.

Even if we start counting from today, I do not believe we will have 1 million units sold within 12 months. Contracted for, maybe. But not sold and brought to book.

Given that they now sold about 40,000 units in the last quarter, which provides revenues of $127k AUD (according to the quarterly report). The loss this quarter is still over $500k, so I think it's the million unit sales per year that is REQUIRED to break even.

There is a discrepancy between the quarterly report and the s/h update in terms of the revenue. One has $6/unit, the other has $3/unit. I'm assuming this is the selling price and the margin.

So 1,000,000 units per year is 250,000 per quarter, at $3 margin, is $750k - which is about break even. Currently showing $127k revenue, plus loss of $521, means costs are $648k per quarter. Currently. May rise a bit if they are turning over 1 million units.

These are the figures, as shown by the company. So I'm comfortable with my investment in this company, but I don't expect it to rocket overnight. These things take time.