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[Bobwins]

NCI.v/NYWKF C$.10

NTG Clarity is a Canadian company that provides software for the telecom industry. They are focused on the Middle East and recently announced several new contracts.

2012 annual revs were 5.0million with profits of 776K or .026eps/.023eps FD.

29,468,391 shares outstanding, 33,713,891 FD

This year, they announced two significant contract wins of 1.2 and 4.2 million dollars that will roll out over the next 12 months. This is a huge jump that should propel gross revs upwards by close to 100% over the next year. Q1 gross revs were around 1.4 million with profits of 202K. Since they are already profitable and the gross margin for 2012 was close to 50%, these new contracts should be very profitable for NTG.

http://www.stockhouse.com/companies/stories/v.nci/8875966

http://www.stockhouse.com/companies/stories/v.nci/8861010

http://www.stockhouse.com/companies/stories/v.nci/8870716

I bought today at .10. There isn't much liquidity and the stock was at around .06 before the recent announcements so I'm not one of the early birds but if these results move to the P&L, the stock should still see a big updraft. Even based on 2012 numbers, it is dirt cheap at 4X 2012 actual FD eps.

So overall this stock is very cheap and has big growth coming in 2013-14. The balance sheet has a big amount of slow moving a/r. 3million in a/r versus 5 million gross sales means a/r is taking 216 days to collect. There is bank indebtedness but doesn't appear to be an actual bank credit line but book overdrafts. So liquidity is a big risk and if they had to charge off any of the slow receivables, profits could disappear quickly.

I have followed the company for several years. I owned it a few years ago but sold because sales stagnated. Liquidity of the stock is a big issue. I think we are entering a period when the stock will trade more but it depends on the P&L results.