1H15 report, page-19

Whilst the half-year results may have been disappointing it should not have been a surprise.  I am keen on NTC but their failure to win additional contracts warranted a correction (something I have been saying when it reached it rose to $0.30) and I hope other long-term shareholders also reduced their holdings at the appropriate time.  I have commenced buying back some of my holdings and will continue to do so when/if the price continues to drop.

There were some interesting comments during today's conference call.

Lack of notification
Is it just me who did not get an invitation to listen to the conference call?  Financial results conference calls should be publicized well in advance to give all shareholders and interested parties an opportunity to participate.  This is common practice and yet NTC do not seem to think retail investors are worthy of an invitation.  If NTC management want to earn the same salaries of their larger counterparts they should act accordingly.

NBN
David Stewart said "we expect volumes to be in the order of 37,000 units for the full year to 31-Jun-15."  I am confused as to whether NTC plan to ship 37,000 units in the Fy14/15 year or is the 37,000 figure a cumulative total since the project started.  The most recent NBNCo weekly activation report states 30,584 premises were activated.  Based on this, I assume the 37,000 figure is the shipments for FY14/15 although in doing so one has to assume that the remaining part of this financial year is to see a massive increase in activations or NBNCo is willing to take on additional inventory or both.  If the figure is correct and FY15/16 will see a substantial increase in volumes, even at 40,000 units, the NBNCo contract will attribute approximately $20M in revenue.  Very nice indeed but I will wait for the activation statistics to confirm the demand before I get too excited.

Ausnet
There are 300,000 meters that don't have a communication module and a percentage of the 300,000 meters with WiMAX modules could be replaced.  Ken Sheridan states that Ausnet plans to complete the rollout by 31-Dec-2016 so one would assume that if Ausnet want to meet this deadline they will need to announce the winner of the communication module contract some time this year.  I can't see Ausnet going through the design/testing/certification process with another supplier and then allowing an alternate supplier sufficient lead time to deliver the large volume of units.  Based on this, it is fair to say that NTC is the most likely supplier to win this contract, estimated at a minimum of $30M.

I did notice that the word "elevator" was not mentioned in the call nor the presentation.  I assume that the Vodafone M2M contract win with Kone will not involve NTC.

I suppose it is another year of "keeping the faith"