the issues

The key problems facing NBS at the moment are as follows:

(1) Receivables from the Malaysian contract are probably now around 60 days past due, and possibly as late as 90 days past due.

(2) NBS was due to receive a large payment from China sometime during September. The fact that we are now in October means that China receivables are now technically past due as well.

(3) Over the last 3 weeks, NBS management have stopped talking to analysts and larger shareholders; they are not returning phone calls or emails. I think the reason they are doing this is that they know that the first question everyone will ask them is "When will the cash come in?" and management can't answer this question at the moment, so they have decided to say nothing.

(4) A history of poor corporate communications as described in my last post. Management have unnecessarily raised the expectations of the market to a high level, have not delivered in key areas, and have now withdrawn completely. It's almost as if they are intentionally trying to maximize investor anxieties.

(5) Because the big contracts are sensitive govt security contracts, it is impossible for shareholders/analysts to obtain any meaningful collaborating information from google, independent sources, etc. I.e., we can't really cross-check the information they have provided for us.

On the plus side:

(1) Assuming that NBS management take their continuous disclosure obligations seriously, then we should conclude that there are no material problems with either China or Malaysia.

(2) The auditor has given the company a clean bill of health as of June 30.

(3) Govt debtors should be relatively low risk, so the cash should come in any day.

Some conclusions:
For me the key issue at the moment is whether or not we can trust NBS management to fulfill their continuous disclosure obligations; Strictly speaking, the fact that management have not released any information to suggest that there are any material problems whatsoever means that, as of yesterday, there are no material problems. And on this basis, we should conclude that both the govt debtors are just a bit late (or perhaps a fair bit late in the case of Malaysia), but there is nothing to worry about over the medium term. It is just a matter of being patient. Once the cash comes in this stock will soar as per my previous posts. On the other hand, the complete lack of communication over recent weeks combined with the odd communication over the last few months has probably led many sophisticated and insto investors to conclude that management are hiding serious problems.

My gut instinct is that there are some problems with both debtors (I was expecting an update on China yesterday), but that management genuinely believe that the contracts are on track to deliver and that the debtors will eventually pay up.

Today's price fall may motivate an ASX please explain, which may shed some more light on some of these issues.