A2's revenue includes the Lucent payout which is non-recurring (and relates to payout of a 5-year contract related to the former OneTel Next generation network).
The $6.0m payout includes 4 years of revenue attribution, including 3 years of future attributed revenue benefit, and revenue attribution for the last 12 months.
The more accurate way of looking at Q2's performance is to deduct this amount from the $17m in revenue generated, and then compare the adjusted amount to the Q1 results. This will bring you closer to a 35%+ q-on-q rate of growth off a low base. But, all things considered, Q4,01 generated $6.0m in revenue, Q1,02 generated $8.0m in revenue, and Q2,02 generated $11.0m in adjusted revensue terms.
Of some additional significance though is that, but for the Lucent payment, UEC would have been cash-flow negatiave in Q2, to an equal or greater extent than was recorded in Q1.
Yes, UEC is a slowly improving story, but it is coming off a very low base, and still has quite a way to go.
Some of my arguments from HC1 (circa October 5 2001), therefore, still apply: 1) further provisions required vis-a-vis cost of its network; 2) operating costs still need to be brought down further; 3) lower operating cost base, inclusive of depreciation and amortisation costs, is still required in order to generate EBIT +ve results, and then some through into a "true" net profit situation; and 4) staffing /management carrying costs still need to be looked at.
