PSOL getting hammered on the resignation of the CFO. Might be a good opportunity to do some bottom fishing?
Ask is now $0.14, they did a private placement at $0.23 earlier this year.
The company appears to be making progress at growing revenue...and this knee jerk reaction today may be overblown? Here's a summary of their current conditions:
Current Conditions
As discussed elsewhere in this Prospectus, we recently closed a Private Placement of our securities resulting in gross proceeds of approximately $3.3 million. We anticipate that the net proceeds from the Private Placement will be used to expand the sales and marketing efforts in the near term and for other general working capital purposes.
In 2004, we have begun to expand our sales and marketing capabilities to seek new sales opportunities for our products and services through our direct sales force and our relationships with communications infrastructure providers. The markets for these products have been and continue to be very competitive. Sales opportunities in the United States of America have continued to be limited due to the continued constrained economic conditions experienced by the communications industry, although we have begun to see improvements in the marketplace. While we believe there is a good opportunity to sell or license our solutions to Rural Broadband CSPs, the sales cycle in this market can be six months or longer because Rural Broadband CSPs are frequently publicly owned utilities and are subject to various regulatory requirements and agency oversight that can delay the timeline for a Rural Broadband CSP attempting to offer new services to its customers. While sales opportunities have been
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available in international markets, such as Asia-Pacific and Europe, currently we are not actively pursuing these geographic markets because of competition from larger competitors who have a local presence in these international markets, or locally based competitors in these international markets due to our current lack of a more fully-developed international sales and support capability.
During 2003, we successfully deployed our products and services into the "tier-one" Cable MSO and rural broadband markets, and have continued to focus on these domestic target markets. Additionally, we launched our application management and hosting services during 2003, and anticipate that these services will become an increasingly important element of our growth.
Our other notable activities and accomplishments during 2003 and the first six months of 2004 were as follows:
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Increased our Connect IXC deployment support to a "tier-one" Cable MSO customer to assist this customer in rolling out its voice-over-IP networks ("VOIP") service to its cable markets during 2004.
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Deployed Connect IXC for another "tier-one" Cable MSO for its rollout of VOIP services beginning later in 2004.
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Deployed Connect CCB, an integrated customer care and billing solution, and Connect IXC at a municipal utility to support its rollout of VOIP, cable television services, and high-speed data services.
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Entered into a multi-year agreement with a rural municipality to deploy its operation support systems on a "next generation" network to support voice, video and data services on the same network ("triple play").
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Enhanced our products to provide additional value for the customers in our target markets.
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Further established relationships with communication infrastructure providers who are active in the rural broadband market.
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Increased our marketing activities to build market awareness of our solutions through increased participation in trade shows and other activities.
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Continued assisting our largest customer in migrating from our legacy billing system to our new billing system.
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Expanded our senior management team.
During 2003, we increased our cash balances by $66,000 to $1.25 million at December 31, 2003, and increased revenue by $389,000 to $6.5 million for the 12 months ended December 31, 2003. Despite our improvements, we do not expect to achieve profitability in the near future as we continue to invest in growing our business.
As discussed below, we recorded $534,000 of revenues from application management and hosting services during the first six months of 2004. We anticipate that these services will become an increasingly important element of our growth during the remainder of 2004.
We expect revenue to increase in the second half of 2004 and we expect services revenue to become a larger portion of total revenue as a result of the deployment of services to more customers. As we continue to build our services offering, we expect margins associated with services revenue to improve as certain fixed costs of services are leveraged to produce more services revenue. Working capital significantly improved in the second quarter of 2004 because of the closing of our $3.3 million Private Placement.
"Our houses are such unwieldy property that we are often imprisoned rather than housed in them." - Henry David Thoreau, Walden: Economy, 1854
