That is simply amazing JDS. I would assume that the profit margins on service revenue is quite high so once they get the R&D costs outta the way i would expect their profit margins to go up substantially.
Very interesting observation. And i know its the truth, but i find it hard to believe.
We saw 3 contracts PR'd in the Q1 worth like 4-5M. now if those are included in the Q1 and your telling me we still have more sales not PRd and the MAKO and electrowave revenues plus 60% more from the core DDI....Thats crazy revenues. I wonder if they can make a run at the 10M mark if we get those 3PRs included in Q1
Here are some quotes: "This is a great question and one that is extremely important to understand. Deep Down is a service-minded company that develops technological solutions to help get done what its customers need. So, for example, the Moray(TM), which is at the terminal end of a steel flying lead and connects the J-plate to the wellhead, was developed by Ron Smith with certain ingenious enhancements to better address underwater installations with ROV's. These types of innovations then typically become products that are desirable to a wide range of customers with similar installation challenges.
So, to answer your question, YES! Not only does Deep Down make money with installation management and service, it is DDI's core business. Ron Smith's vision is to provide offshore E&P companies with senior-level experience and technological innovation to help them complete projects on-time, on-budget, and more safely.
Again, great question, and understanding this fact about Deep Down will help one understand that our service business drives our technological innovations."
JDS thanks for reposting that part, as I found this section to be very impressive too..............We have been involved in almost every Umbilical installation and Steel Flying Lead installation and development in the Gulf of Mexico. Approximately 40% of our revenue is from product sales.
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