the real concern here... and has been for a while now - is the...

the real concern here... and has been for a while now - is the balance sheet.

Cash conversion has been terrible and contract wins since the oil industry downturn have been immaterial at best...

We are still a market leader - but SDA has failed to integrate businesses that they have paid far to much for - hence why the balance sheet is out of whack with most of the businesses assets tied up in intangible assets, which have no value to any other business (well - good brands are intangibles which can be sold... but SDA's intangibles are mostly unsaleable). This leaves SDA with a lot of debt... and not much to sell to pay it down (~100m of physical assets at cost less depn... not sale value ).

The hope of the last CFO - and JPY would have been that they could trade their way out of their poor balance sheet by having the oil industry pickup and their new assets starting to pay their way. It hasn't happened, debt has increased ... and they are both out of their jobs after betting on green.

Shorts started picking on this stock a VERY long time ago... not long after Globecomm was acquired - obviously their research was centered on how stressed the balance sheet would be if the businesses did not bolt on well and the possibility that the industries that SDA had historically depended on would have a sustained period of downturn... which has happened... so the SP has been in a period of constant downward pressure as the shorters view of the business becomes more and more a reality.

For two quarters now SDA have been stranded by their debt and have very few options to get out of it - they have just been managing to meet their covenants and hoping for industry to turn around so everything could get a bit easier. They are a stranded ship adrift in the current - equity is needed to bail them out here.

LT, I still believe in SDA, but there is new entrants coming as with any industry - and they have a lot to tidy up before there is any hope of recovery.

My two cents only - DYOR... off the soap box now