Half Yearly Report, page-24

I agree, the result was largely irrelevant and the full year results are more important but NTC needs to post a decent net profit at some point to justify its current market cap. Many posters here and investors in general believe that the profits will come and I still hope they will come but even NTC management's expectations have not been met in the past. Do you remember when the Vodafone machinelink 3G was launched? The presentation said "hundreds of thousands of units" would shipped in "2-3 years" time, well it has almost 3 years and NTC are not shipping anything close to 100K units.

I agree NTC needs to invest in the future, but if current profits are consumed by continual investment, when does NTC get to sit back, relax and enjoy the profits? By that time, the products that NTC offer will be generic/ubiquitous (one could argue this is true today) and customers will choose to buy the cheapest product on the market, just as they do with modem/routers today. To give you an example of this, NTC was a primary supplier of broadband devices to Telstra many years ago. The relationship resulted in a decent net profit for NTC. Nowadays Telstra opts for cheaper devices from foreign companies. It could be argued that NTC's contracts are designed in a way to protect themselves from future competition, but without any quantitative commitments within the contracts, anything is possible.

The share price is where it is today because of an expectation of what the US fixed wireless COULD bring to NTC and unfortunately there is no solid evidence of that expectation at this point. Take a look at Sierra Wireless' share price history and it will show you how expectations can turn a share price chart into a roller coaster.

I kept 8% of my original holdings for tax reasons and partly for sentimental reasons; everyone likes an underdog. The hardcore investor in me says that there are better value IoT/M2M opportunities out there today, i.e. Sierra Wireless and Telit.