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MER Telemanagement Solutions Ltd. Message Board

  • per_a.jacobsen per_a.jacobsen Aug 15, 2013 1:04 PM Flag

    After the final thoughts

    All,

    The guesstimated earnings release date was accurate, so the postmortem is:

    MER Telemanagement Solutions:

    * announced less or equal earnings than those of last quarter, so down we went.

    * announces less revenues than those of last quarter, so down we went.

    * says nothing whatsoever about the future, costs savings, and new revenues and earnings opportunities, so down we went.

    From a purely economic standpoint, the results from this quarter were good. However, again this quarter, the company did not communicate well and/or appropriately, and, therefore, MTSL is being punished.

    One area that could have made a significant difference is a direct addressing of the cost issue. Saying, for instance, that the company will reduce cost by 25% by the end of the year would have been enormously compelling and would, I believe, have offset the revenue/earnings drop.

    The numbers are, of course, the ultimate arbitrator of truth, and as it stands right now, they are yelling that immediate cost reductions are needed.

    To be sustainable in 2014 (and, therefore, valuable above the per share level of $3, or so,) the company *must*, in the absence of new and immediately accretive deals, reduce costs to the point that it has neutral or positive net income when factoring out the Simple Mobile contract.

    The math is simple... At $300 thousand, or so, revenue contribution *per month* from Simple Mobile, and net income of $300 thousand *per quarter*, 2014 looks like a year with red quarters. Something has to be done before then, and ignoring the problem is not something -- it is nothing.

    I am sorry to see that the company is not addressing the issue at hand. I believe that MER Telemanagement Solutions have potential for being a great company, but, in order to fulfill this potential, its management staff has to perform better... far better.

    Best.

    pajacobsen

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