Originally posted by Capraise
I totally agree with you. For me not showing the three different segments Wa, Vic and Act, means we can't see which state is holding cnw back. For me it appears to be wa. I'm afraid the purchase of L7, for 500k might be the problem. It's more than likely bleeding from unprofitable contracts signed up before aquisition. Hopefully this ends soon, and the focus can be on manage service contracts, and not so much on revenue growth, I wouldn't care if that dropped, and the bottom line improve.
I don't think one geography is necessarily dragging them as much as integration costs. They had about $500k impact to their bottom line because of the Correct Comms integration.
I think that if the quarterly revenue and split is the same this quarter, they would make around 500k profit (per quarter). compared with the current run rate much lower than that.
I could be wrong and we shall see if there is a 'cyclic' type action, however i went through the last 8 quarterlies and it doesn't seem cyclical as much as growing with teething and acquisition pain. Shall see...
Lets also not forget that they have added about 50 professional staff in the last 12 months to keep up with the growth in managed services. As this settles down the overheads will decrease and profitability will improve. This will be a slow and steady story as it plays out.
