Kory, Look closer my friend..they have never made 8.5Mil NEVER!!
The 8.5 mill you speak of was purportedly made on some one time deals for distribution rights to Digiphone. However these are somewhat suspect because DW the CEO of Camelot owns controlling interest of and or is CEO of all of the parties involved in those deals. The loan stock that the quoted profits are based upon has been devalued by more than 60% and Camelot has written it down (maybe more now as Meteor stock has meteored through the floor since DW took over). The real numbers for Q2 were so bad that they would not even report them seperately. Instead to hide the blood,they combined them with the previous quarter in the attempt to make the real picture less clear, and appearances less hideous.
Actual earnings for Q2 TOTALLED all of about $186,000. In fact if one looks at the record closely they will see that Camelot has never yet reported a profit based on sales of goods or services. In fact there have been only 3 quarters in which they were able, through creative bookkeeping to show any profit. In all cases this was due to one time deals. In two of these quarters the claimed income was never recieved..
from two failed attempts to sell Scandanavian and British rights to Digiphone. I believe that they are in litigation over these deals, but the fact remains that they never recieved as much as 20% of what they claimed, so in truth they lost money in those quarters as well.
In q1 97 they showed the full amount of a 7.5 mil deal with Meteor PLC for digiphone rights. Even at that, with all of the losses on operations and having to write down the value of the loan sock by about 40% within weeks of the transaction, they were able to show only about 3 mil profit. They later wrote down the deal by another mil or so. Also keep in mind that the loan stock is worthless until sold, it cannot be used to capitalize operations or pay personnel. Are you getting the picture. This 8.5 mil income that you talk about is 100% smoke and mirrors. The key here though, is that they never in their entire existence have managed to turn a profit by marketing and selling any of the goods or services that they produce. Eventually even the most creative bookkeepers run out of tricks.
BTW the Q3 reoport will be made to look somewhat less terminal by a 3.5 mil private placement. The poor investor paid $1.00 per share, and lost about 40% within weeks. Anyway, once again when looking at the numbers look past the highly publicized numbers and see if they sold anything. See if they made a profit on any facet of their business, besides getting unwary people to give them money for worthless stock. The record unequivically shows that they have NOT!!
Even the shrewdest high financier will run out of people to beg money from if they cannot show at least some potential for turning a profit on business activities at some time in the future. Past and present performance shows that this is highly unlikely in Camelot's case.
Potential for digiphone? Well the number of competitors in this market has skyrocketed. Today there are more than 30 companys producing net phone software. Many of the big boys like Microsoft, Intel, Lucent Technologies, and IBM have joined the fray. People like Vocaltec continue to deliver new improved products quickly. Almost all of the major competitors now offer VIDEO, whiteboard, text chat, online directories, file transfer.. even the often promised but never delivered Digiphone 2.0 offers none of these competitive features to my knowledge. Digiphone has not had a major revision in 2 years. They did release digiphone delux, but it was the same product with some useless features, and it was almost a year late (Delux has dropped from a suggeted price of $150 to a street price of around $30...tell you anything?). Now it is Digiphone 2.0. It is supposed to incorporate the Lucent codec. But guess what? After 7 months they have been unable to even incorporate a new codec (it recently became even more unlikely that they will soon or perhaps ever produce 2.0 when the vast majority of their development team management and staff either was fired or quit). A company like Vocaltec would have had this done in a month!
It sure does not seem as if they are in much positon to take part in reaping the profits that should be availabe in this market.
Mr CD ROM. Well Danny promised 100 stores in the first year...he delivered 6. That is all there are now...two years later. He tried changing to a cost pus 10% format...still losing his butt, he recently decided to consolidate stores...I believe they will end up with 3 stores( of course this could be in part because his president of the retail division has recently quit and many others have fled from this dead end right behind her). Does this sound like progress? Does this sound like success? Does this sound like a profitable endeavor? A company may have a viable product, but if they mismanage it to death they will undoubtedly be relegated to the class of failed businesses sooner or later. In this instance all indicators are towards the sooner scenario.
So Kory, please go do your homework, look below the surface. Please look at history and develop a healthy sceptical attitude about what you read in Camelot hype releases. There is speculation and there is futility. I would suggest that Camelot has dropped from the former to the latter category with little prospect for recovery. |
