WEB NEWS GeoSpecial Notes
Yesterday, Teltronics Inc reported 2009 year end numbers. While annual numbers showed significant improvement, the fourth quarter was well below previous 2009 quarters in terms of revenues and EPS.
2009
1st Quarter
2nd Quarter
3rd Quarter
4th Quarter
Net sales
$ $ $ $
Cost of goods sold
Net income
Net income (loss)per share:
$ $ $ $ )
$ $ $ $ )
2008
1st Quarter
2nd Quarter
3rd Quarter
4th Quarter
Net sales
$ $ $ $
Cost of goods sold
Net income (loss)
) )
Net income (loss) per share:
$ ) $ ) $ ) $ )
$ ) $ ) $ ) $ )
The company avoided a fourth quarter discussion in its year end release , so we it is unclear if this is a temporary hiccup or something to be concerned about. We were particularly surprised since the company just announced a capacity expansion program.
Its possible that there may have a disruption in business as the company moved into its new facility:
"In 2009, we moved into a more cost effective state-of-the-art facility. The new building allows us to showcase our business to worldwide clients, partners and potential business associates thus providing us an additional tool to further increase sales & revenue," Cameron states."
Also, the company's first and second quarters are its weakest:
"Due to the buying trends of our customers, we do experience some seasonality in our business with the fourth and first quarters being our weakest. We are working to expand our customer base to reduce this affect."
Comments were still bullish:
"We should continue to see sales from our current U.S. customers and our international installed base. Our goals for 2010 include building upon our current international distribution channel, expanding our U.S. strategic partner relationships, and growing our current product offerings to reach new vertical industries."
We will attempt to gather more intel before making a final determination on Teltronics status as a GeoSpecial. Potential investors should be aware that shareholder equity is still negative, which could increase the likelihood of an equity raise if this situation continues.
Special Situations
Excerpt From GeoBargain & GeoSpecial Review article, November 17, 2009 .
Teltronics Inc (OTC BB:TELT) Closing Price Nov. 16, 2009: $1.62
Started to track the stock on August 24, 2009 at $0.57
The GeoTeam® finally initiated a position in TELT. We are hoping the company can continue its dramatic earnings turn-around that began during its 2009 first quarter. Thus far it has delivered as evidenced by its stellar financial results reported on November 16, 2009.
Research
The GeoTeam ® is taking a closer look at Teltronics (OTCBB:TELT). The Company designs, develops and manufactures electronic equipment and applications software systems that enhance the performance of communications networks.
Teltronics' recent endeavors to streamline operations have resulted in the Teltronics being able to post its first substantial quarterly profit in nine quarters with a 19% increase in revenues to $11.7 million.
The current state of the global economy and credit crunch has resulted in challenging times for all businesses. The Company’s management implemented plans during 2008 to increase gross margin and decrease operating costs; these savings totaled $6,000. During the six months ending June 30, 2009, the Company increased its focus on expense control, reduced operating redundancies, and reviewed processes for increased efficiencies. The plans have met management’s objectives for the first six months of 2009 ." Source: Sec Form 10Q (FOR PERIOD ENDED JUNE 30, 2009)
Teltronics has not issued a press release discussing its 2009 second quarter results, so it is unclear if the quarter was an anomaly. The Company still has a working capital and shareholder deficit, which is most likely why the stock is selling under $1.00. However, this situation could quickly change if the company continues to post profits in future quarters. The GeoTeam ® will request an interview.
