A couple of things worry me - waiting to see how they pan out.1....

A couple of things worry me - waiting to see how they pan out.

1. Loss of Dick Smith Electronics as a sales outlet
2. One of four supplying NSW Govt - cannot imagine it will be easy to claim both margin and volume.
3. Management changing a number of times in a short period (although resulting in original team who should be experienced)
4. Letting people go (reluctantly) and attempting to trim overheads
5. Attempting to diversify into other products while under pressure on core business.

Because they have a small market cap, there is good potential for a return if they can turn around (despite being in a very mature low margin market). However, they may struggle to turn around.

Consider this a high risk play.

Chairman's address at AGM (partially posted below) :

There are few factors that are impacting our business lately, including the change of management, office relocation in end of June, the loss of business with Dick Smith Electronics and also the delay in purchasing from the NSW Education department.

Consequently, we are expecting a breakeven or moderate loss result in this December half and your company is aiming to deliver a full year profit for the 2005 financial year.

Recently, we have made some changes in our senior management structure, Douglas Wong and Justin Taylor decided to leave the company to pursuit their interests.

Two weeks ago, the NSW Education Department has announced that Optima is appointed on the panel, together with other three vendors, in supplying 100,000
computers to schools in the next four years. Optima is lobbying with the Department in order to obtain a good allocation of orders amongst the vendors.


PS: I have held in the past - but not at the moment - maybe would speculate at lower levels.