Replies to post #16975 on Labor Smart Inc (LTNC)

[DD2Gain]

I don't mean to come off rude, but you really need to look at the history of the company more closely. Last year 8 of 15 branches were less than a year old. This year, 16 of 32 branches are less than a year old. Now compare that to overall revenue performance from year to year. If you are serious about learning investing skills then I'm sure the math is completely within your capabilities.

Edit: I realize you are asking a legitimate question, but you already seem to know what fundamental information to look for from publicly available documents. Gather your information, then see if you have questions.

[DD2Gain]

I had to think about what you were asking and should have been more understanding of how difficult some of that information is to gather. When exactly branches were opened is buried in dozens of PR's so let me elaborate:

LTNC went into 2013 with 7 branches. As I recall, the 15th branch was opened in July. Monthly revenue was growing quite nicely and showed great promise. Then we go into 2014. After 2 years of doubling revenue growth we now see a significant decline projected along with 150% increase in convertible debt PLUS $1 million in delinquent payroll taxes. It'll be sold as another year of "record growth", but in the correct context we clearly see a very large step backward when comparing $16 million with 15 branches to $25-27 million with 32 branches. Furthermore, when the PR's from earlier this year are reviewed we see that the first 14 branches were making up a disproportionate percent of GROWTH- not just total revenue. And now we see revenue stagnating with only 2% growth from branches at least a year old and less than 30% YOY growth despite 100% expansion. The CEO says low margin business has been "culled", so margins will improve with a modest impact on revenue. I think any sensible investor would agree that a 20-25% decline in revenue performance with branches that should all be expanding is far from modest. Additionally, $1.06 million per branch last year is still way off from $1.5 million projected for 2016. Now we are looking at $800,000 per branch with the CEO boasting that he wants to dump $20-40 million into acquisitions next year. Any more questions?