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[southacresdave]

bbotcs--DYNT--- listen to their last CC call. It is very interesting. A caller came on and asked 6-7 TOUGH questions including internal projections. The CEO answered most of them. I'd say part of it was "hype" but the CEO wasn't throwing this info out on his own. It was only as follow ups to the questions.


Highlights:
-- They are not selling to the GPO (as a whole) as a contractor supplier (ex. supply towels to all the members), but instead have been approved to directly contact and sell "capital equipment" to each member of the GPO. The have also been approved for "supplies" with one of the GPO's but the competition there is tough.

--For their "niche" of equipment, their only real competitor is Patterson Medical (A subdivision of PDCO---Nasdaq) that does $110M/year. Patterson has been the exclusive supplier of capital equipment to the members of these GPOs for almost 2 decades. One of the reasons is you need to be able to supply a large selection of products and most suppliers in this industry can't do that (DYNT couldn't either for the longest time. They teamed up with another service company here to accomplish it). Company feels they can compete and capture business since they are also a manufacturer/distributor/and have direct sales force (They and Patterson are the only two with that capability in their niche). Back in Feb during the call they figured members may want a choice now--from latest pr "better reception than we expected" it sounds like it's a possibility.

--Their margins on "capital equipment" are already 50% or greater so selling at a discount to that still is ok.

--This product they just partnered up with in December called "Stream"--it sends reminder texts and e-mails to patients is VERY PROFITABLE. In the first two months they signed up 200 businesses. That is worth $1800/year/customer for the next three years to DYNT (ie. Each customer signs a 3 year contract that costs $399/mo. DYNT cut is $150 and they do NOTHING else. The other partner runs the software and does all the work. DYNT uses their connections to physical therapists and chiropractors to sign them up. (Again, that's $360K/year/3 years for just the first 200 customers signed in the first 60 days offered). The reception they received on that so far is high satisfaction.

--Internal projections if things go as planned.....they expect to increase sales by millions, enough so that they feel they can eventually be able to have pre-tax profit margins on revenue in the double digits. (EX. Right now they earn squat on $8M/quarter. That means doing $1.3M pre-tax profit on $13M/quarter. These last numbers are mine to just show as an example of what I'm talking about.)

The caller grilled them hard and a lot of answers came out. I hadn't listened to this call until last night. Makes me more interested in the future--that management may FINALLY have a plan to bring it together. I need to get off my fanny and call the company to get some of my own questions answered.

Go to "February Conference Playback"
http://dynatronics.com/CompanyInfo/PressReleases/tabid/184/Default.aspx