Ann: Appendix 4C - quarterly, page-47

You could ask the question that way but you could also ask a rather different question. Well a few different questions really.

• What would our revenue have actually been last year if we had only accepted business that was at the least break even or better? How far off the much repeated $18m ($A24million)? What would the share price then have been?

• How long could we have kept going if we had never changed our strategy to focus on profitable business? (I think the auditors note to the annual report in respect of "a going concern " might answer that question)

• Why would directors accept and allow the approach that was followed last year? What was in it for them or what was missing? (I note that the annual report commentary included reference to the shareprice being the result of the new strategy. It did not repudiate the strategy from last year or deny the approach that was taken. Would we have needed a new strategy if the old one had delivered? Isn't that then tant amount to indirectly acknowledging that last year was wrong? Or have I misunderstood that?)

I think the commentary also begs the following questions

• What proportions of the revenue represent ongoing unprofitable business, ongoing profitable business and new profitable business

• How much of the unprofitable business continues to be serviced

You see I don't think we can really tell much about the rate or value of customer acquisition at present. But what if every quarter is mostly new business? That would mean that we are actually acquiring new customers at pretty much the same rate as last year but it's at far better margins.

There is, however, is a tension in all this. The "market" whatever that really is, doesn't get excited when it looks like stagnation even if in truth it is not.

I can't be bothered checking back on the share price pattern but there is no doubt that there has been a price to pay for last year and that price continues to be extracted. I don't think there is an easy short term solution to it either because the "gloss" has gone. Right now, like it or not the business looks stodgy.

That doesn't mean there is anything wrong with that but once an early phase company /small cap stops being sexy share price growth can only happen with better than solid results. Rapid shareprice growth will only happen with rapid growth and outstanding results. Otherwise be prepared to be here for the long haul.

Which of course takes us to accountability. Who should bare the consequences of all of this? Shareholders alone?

Parsifal