That’s too bad. I had just about convinced myself that they were separate. I had emailed IR but never got a response. That contract is still about 60% of the current annual sales to non-major customers, so it’s hard to be too disappointed.
Once margins stabilize, this should look really cheap. If you assume 20% GM (avg of 2013-2015) and $50 million of sales (which they might even hit in FY 2018), it’s pretty easy to get to about $3.5 million of net income...or under a 4 PE right now.
One concern I have is the level of sales to the leasing customer. I assume they are still building their inventory of pallets, so I wonder what the ongoing revenue will be once they have all the inventory they need. I guess Kruger isn’t concerned if he’s ordering 3 more machines though.
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