Tom,
I was disappointed to hear that they may have another write-off next quarter, but I talked to Regi about it and found out some things. In order to turn some of these places around to profitablity, they need to get rid of people. Sometimes, the people have multi-year employment contracts, so they can't be fired, so you have to sell the place, usually back to the original owner, and take a loss. The California loss-to-be is still left over from the previous CEO, but I think it is the only one.
From talking to Regi, it seems that he is more focused on increasing Revenue, at the short term expense of profits. This I don't agree with, unless he personally know people who invest based on that. I don't. I will try and talk to him again, and see if there is anyway they can be profitable as soon as possible, even if it means passing on a new revenue source. I realize this is short term thinking, but I think thats whats needed to keep the stock on NASDAQ, and keep people interested. Grow the revenue the next quarter using some of the profits. If anyone thinks that getting revenue up to 100M, without a profit, is going to help the stock price, please post and explain it to me.
Kevin |
