The deeds of the past have been done. I think that the Board of Senetas has done exactly the correct thing by informing the market of their current position. But really, they can not win with some. They get criticised for a lack of transparency but when they are transparent, they get criticised for being so and suddenly they are not instilling confidence in the market!
Let be no mistakes made about the quality of the Senetas technology. Fait accompli! The real failings of the past relate more to the poor and inadequate focus toward building a bona fide business. The methodologies embraced by past management related more specifically to exit strategies and personal gain. The company has had to deal with this process and have done so in a transparent and upfront way.This indicated by the quality and substance of announcements made to the ASX over recent times.
There are many underperforming companies that have gone through upheavals and come out at the other end far stronger. This is usually a result of having a suite of quality product and/or services, a sound business and distribution model and most importantly, leaders that actually know what they are doing. Senetas in the past received only one tick there! I do not think that it is at all fair to blame the current management with the processes of the past. They are simply addressing the negatives that have impacted the performance of the company, and basicallly not concerning themselves at this time about the shareprice since their primary focus is on restructuring a business!
In the past, it would appear that Senetas could boast no particular individual with the capabilities or acumen required to grow a business of this nature. As a result, the following were evident-:
1. A very poor go to market product distribution model. Rememeber the old saying, you can have the best product in the world but without good marketing and sales conduits, it does not really matter!.
2. Lack of a sales orientated focus- in the past, it has been generally recognised that the management of SEN had a clear focus on an exit strategy. In many ways, as a result of this focus, they pursued a path of least resistance.
3. Poor ancillary investments that have proved to be underperformers ie IPT ....and are to be correctly written down in the current accounts!.
4. Relatively incompetent or sparse sales force, the incompetencies of which tended to be compensated by the Safenet "WORLD EXCLUSIVE" distribution which was going to be the sole deliverer of sales traction from a potentially addressable market of $250m. We all know the subsequent impact of this.
So all of the above needed to be unwound and restructured. In the process, the fiscal impact needed to be brought to account as soon as possible so the company could go forward without any ifs or buts. I do not wish to offend here but anyone with any sort of business background of any level would understand both the reason and the merits for doing so. So all this is being done, as Senetas quite correctly states that it is 'Clearing the Decks" in anticipation of 2008 growth.
Senetas is a business of great potential. It has been injured but certainly not fatally by past management's decisions. Without doubt, it boasts some of the very best technology and technical people including designers and engineers etc in the business. It is a hub of creativity and excitement, something most do not see unless they can be bothered to get on their bike and take a look. Finally, Senetas now has an industry schooled CEO that understands excatly what to do and a Board that supports him fully.The plan has been configured and is now being executed. For those shareholders and investors with exposure and currently losing money, I would strongly suggest that you get to know the Senetas business like a cow knows its calf. If you do the latter, you will simply become immune to the knowledge void, emotion and the subjective venom that is continually expressed on this forum but, far more importantly, you shall become well informed about what it actually is that you have invested in.
ciao
SEN Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
