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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Jurgis Bekepuris who wrote (41538)	2/28/2011 7:39:02 PM
From: Keith J	Read Replies (2) \| Respond to of 78702

The thing to remember with VSEC also is that a good portion of their revenue has come from pass-through revenue on the R2 contract that is being phased out. The decline in revenue there doesn't hit profits too much. But everyone sees the big drop in top-line revenue and backlog and thinks the company is in bad shape. From the 3rd quarter 10-Q: "A significant portion of our time and materials revenues are from CED R2 Program task orders under which revenues result primarily from the pass through of subcontractor support services. These revenues have a lower profit margin than revenues generated by work performed by our employees." KJ