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Re: None

Wednesday, 06/10/2015 1:32:57 PM

Wednesday, June 10, 2015 1:32:57 PM

Post# of 8579
I'm going to try to put the 630+K May revenues into perspective by reading between the lines as best as I can. In a "more perfect world" the press release would have done this for us, so that investors and potential investors could make more informed decisions sooner. What my goal is here is to make a guess in regard to Q4 revenues and see how close that guess comes to what we on this Board recently agreed as the company's goal/estimate of $2.41 million for Q4 which in turn would tie to the company's estimate of $6 million for the full fiscal year.

What this all means is that I need to make guesses for April sales and for June sales. If April had been a stellar month, we can presume that the press release would have spoken about April's sales as well as May's. Lacking that, I'm going to guess 400K for April which is the average per month sales for the first nine months of the fiscal year, but also does represent growth from the average monthly sales in Q2 and Q3 (both of which declined from Q1).

Regarding June, the company said in the press release that sales would be "strong," but they didn't say that the sales would be stronger than May's. So I'm going to guess 570K which is about 10% less than May.

So putting the three months together, 400K+630K+570K adds up to $1.6 million for Q4 which is 25% less than the $2.4 million this Board has been looking for. That takes us to $5.2 million in sales for the full year. As regards the bottom line, I would guess that Q4 by itself is going to be very close to break-even, one way or the other, and the full year loss will therefore be around the 400K that represented the results of nine months of activity.

Given what I believe is the intentional "murkiness" of the press release, I think I can understand why all the recent good news hasn't created a buying stampede, and I still think that the pricing of the upcoming new equity financing is going to dictate how this stock will perform going forward.

Don't get me wrong here - I still think that over $5 million in sales for the first fiscal year is something to crow about and I still highly respect Sgreg's market value comparison of this stock to others in the industry. But I do think that the company is not doing itself favors by cherry-picking the good stories and leaving out the rest when directing Paul Knopick to issue press releases (which I still find to be exceptionally well-written).

I think that investors will place a higher price-earnings multiple on transparent companies than they will on companies in which investors need to be more active and effective in due diligence, because investors performing due diligence will always realize that they haven't caught everything that's being held back. If I were more blunt, I'd write that cherry-picking is the most subtle form of pumping, and all pumping ends poorly.

Summary: This is a viable company with some great products, and it can become a great company in an exceptionally fast-growing industry. The way there will be easier and more certain with greater transparency in reporting. The Company should have reported actual April sales when telling us May sales; the inferences investors draw from having had that info withheld are not more positive than any number that would have been reported for April.