"Distributor interest"
That's an absolute nothing line.
They still have no Australian, NZ, APAC etc distributors for any products.
Average time from "distributor interest" to signing is approx 5-6 months and even then the revenue won't really flow for at least another 6 months. The distributors will do an initial buy in of product but these are usually heavily discounted. Add in sales staff training time, then getting clinics/hospitals etc to buy can add another 6 months, so you have a minimum of 12 months before any revenue flow from distributors.
The margins on distributed products is usually low so volume is the key for sales growth. This seems obvious but it isn't as there is usually added payment terms for distributors as well and if these haven't been negotiated well then there isn't really any money to be made. Remember the key line in medical device company investing, The higher the price of a single unit, the higher the margin.
Compare the net margins on an MRI machine Vs a roll of silicon oxygen tubing.
I just can't see any revenue (let alone net margin) coming in the next 12 months for Uscom which will see continued eating into the cash.
In my opinion, they have 2 years left at best with current sales figures. At worst, without further fund raising, they are gone in 12 months and some Chinese company will grab the IP for next to nothing.
Im so far underwater on my buy price right now, I may as well take the loss when they go under.
Add to My Watchlist
What is My Watchlist?
