Sangoma Technology's Annual Report shows it's Flush with Cash

         On August 13 Sangoma Technology (STC) released an update on it's annual results for 2020.These are unaudited results for the yearend of June 30.And on August 14, STC stock moved up 12% to $2.73 per share.Investors saw a number of things in this report that they liked.First sales are expected to be $133 million for a 22% increase over 2019.And 2019 sales were up almost 50% from 2018.Secondly Sangoma tells shareholders that EBITDA will be at the upper end of their annual guidance,that is,$21 million.Guidance was for $19-$21 million EBITDA.No information was given on forecasted net income or e.p.s.But investors can see that even with the slowdown caused by the pandemic Sangoma showed excellent results.The press release pointed out that there was a softening of it's product sales but there were strong service sales.

         Annual Highlights

   Clearly the biggest surprise was the growth in revenues when the economy was in a very slow phase.In fact, the growth since 2018 is almost 250%.That is because Sangoma made 2 important acquisitions in late 2018 and 2019.And it usually takes more time for new divisions to mesh with older divisions and older products.But another large surprise was that STC raised $80 million in 2020.This represents 33% of it's market capitalization in one year.And is an excellent accomplishment for a small cap.STC says that $9 million of the new funds will be used to pay off  their credit facilities.

                                             

 

     The Year Ahead  

     Now STC is sitting in a good position with $70 million in cash and little debt.Some of this cash will be invested in it's present operation to foster organic growth.But there will be lots left over to make acquisitions.Sangoma may already have it's eye on a likely candidate now.But there are a number of listed small caps in it's space with reasonable Price to Earnings ratios.And there is a plethora of junior  techs that are unlisted that are very inexpensive to buy.The benefit of juniors that are unlisted is that they often have new technologies to bring with them.But new revenues are hard to get with a junior technology company.So perhaps the best suggestion for new acquisitions is to take one of each - a junior listed telecom company and a junior unlisted telecom based company.

                 https://www.fool.com/ 

Vecima Networks is on the Move

   Vecima Networks is a little heard of internet video provider.Still it is not that small as it's market capitalization is about $250 million.It largely delivers video streaming and other broadband services to subscribers,usually in remote areas.Recently it made 3 changes in it's management to accomodate it's recent growth.It now has a new COO and SVP (senior vice president) of Content and Broadband Solutions.More importantly it also has two new contracts for delivery.One was to a Canadian cable operator called Access Communications and the second was a Tier1 operator called APAC.Tier1 APAC has more than 5 million subscribers and Access Communications is one of the biggest cable operators in Saskatchewan and Saskatchewan has almost 1.5 million population.                                                                                                          No   estimate is given by VCM as to the revenue that will be earned here.However it is likely that Vecima is only counting on revenue from the content originator like Apple or You Tube at the start of the arrangement.But it is Vecima that has an interface with the customer.And a small subscriber fee  on each service (internet,video,telephone for example) in year 2 would certainly change the financial dynamics for VCM.
          

 Looking Ahead

 These two contracts point to a new future for VCM.Revenue has been flat since 2016 and it had almost no earnings in 2019.But this blog sees it picking up 3 to 5 new contracts with cable companies by 2021.The contract with APAC will require a $12-$15 million upgrade of their system and take several quarters to complete.But cable operators like Sipisiski Cable(Saskatchewan) and even Shaw Cable(Saskatchewan) are potential future customers. So although  Vecima Networks is on the move investors should only expect positive news in 2020.Revenues and earnings will not improve until 2021.Investors willing to wait two quarters should truly see Vecima Networks on the move.VCM is trading in the $10-$11 range now and investors with foresight may push the stock to $13-$14 by yearend.While further good news will send it to $15-$16.    https://www.shaw.ca/  https://www.zacks.com/ 

The real Cost of "Dirty Oil"

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Tucows starts to Transform into More of a Technology Stock

       This blog made several attempts on other websites (see Workathon-Blogger dated 11/07/2019 and 02/04/2020) to suggest that Tucows,a junior technology stock,needs to change it's management style and it's business model.It has relied too much on registering and cataloguing internet domaine names.This is more of a technical rather than technological business.Furthermore it is prone to competition.And it certainly does not require a 7 member board to get paid $300,000-$500,000 salaries each in order to accomplish it's mission.
      Earlier Blogs
  Tucows started off as a small software company.My earlier blogs suggested it acquire other small internet software companies in order to diversify it's revenues.One of these suggestions was to get into online advertising by acquiring smaller internet advertising companies.But in fact it acquired other domaine registration companies.So that now it has a fairly large stable of domaine names plus a small internet provider in southern USA.Tucows is not a complex technology stock but it is profitable.On an e.p.s basis it is more profitable than much larger software companies like Kinaxis and Shopify.And that is because it has steady earnings with little growth and a small number of outstanding shares.And that is because Tucows' management has until recently adopted a very passive style of management and so has not increased it's capital structure substantially for the last 4 years.    

     Starting to Change
  This blog has recommended a consultant look at selling off some parts of Tucows and acquiring other parts.It has also recommended some changes in the board members (especially the CEO) and a reduction in salary for all board members.None of this appears to have happened yet but there have been new hires recently.This presumably is for new functions other than registering domaine names.Also a new Director of Marketing has been hired for the cloud and SaS activities.However no new acquisitions and no new equity issues have been made yet.      

    Tucows has been as high as $120/share within the last year.This blog believes that investors thought that some of it's suggestions had been taken.When investors discovered it was the "same old Tucows" the price retreated to the $70 area.Now it has moved up to the $77 area on the possibility of Tucows changing from a technical company to more of a technological company.      www.motleyfool.ca  https://www.goodblogs.com/  

Blackline Safety consolidates Acquisitions but Slows Growth

 Blackline Safety has made a number of acquisitions in 2018 and 2019.As a result it has shown good growth in revenues and share price.For example, at the begining of 2017 it was trading at $2.50 a share;now it is at $5.75And it doesn't have much debt outstanding.In addition it had a fairly small capital structure in 2017 and it still has only 48 million shares outstanding.But it has had to be nimble to see the increases in both revenues and the share price.            

Business Profile

Blackline Safety is in the business of digital safety monitoring.This is particularly useful in industrial settings when employees work alone or in dangerous activities.It combines digital monitoring with GPS systems.It made one or two small acquisitions in 2018 and 2019.Consequently revenues increased from $12 million in 2017 to $33 million in 2019.This blog expects revenues to hit $35-$40 million in 2020.But there still is no earnings from their endeavours.I made a blog on another website called Blogdaleupsome on the Google Blogger website(date 01/03/2019) which made this prediction."Look for BLN to hit $5.50 to $5.75 this year and maybe $6.00 with a small acquisition."But BLN did not make the small acquisition and it has been hovering around $5.75 per share.

A Likely Dance Partner

The dance partner proposed for Blackline Safety is called Awesense.It is a Canadian small technology company that does energy monitoring,geospatial data and the internet of things.Revenues are not available but it is not listed on a stock exchange-even the TSX Venture exchange.This blog believes that BLN is in too small a niche now and this merger would open up another market or two to it.Blackline does some geospatial data analysis now and this would increase their market.Also it should be not too big a jump to go from digital safety monitoring to energy monitoring.Here is where BLN might cross another revenue threshold.This blog will try to set up a meeting(on Website123.com) of the two partners to see if they want to dance or not. Investors should look at the possible combination of these two small caps as a chance to see future stock gains perhaps up to $7.00-$7.50 for BLN.            

          https://www.zacks.com/

WIN 20190709 10 39 25 Pro My last Video (already recorded)

Tucows awaits Shareholder Report

    On May8 Tucows released it's first quarter report.There were few surprises in the report-especially to this blog.Although adjusted EBITDA was up 34%, revenues were only ahead by 6% and net income by 1%.So e.p.s.went from $.26 per share to $.27.Tucows is in a mature market with competition and needs to find alternative revenue producers.This blog has been saying this for many quarters now.But there has been no changes made.See blog on www.site123.com on 05/11/2020.
    Tucows tells shareholders that about 35% of revenues come from access networks and 35% from value added services and about 25% from domain services.And as most shareholders know access and domaine names require little management.In fact, Tucows (under pressure) sold some of it's domaine name portfolio in 2020.But it also made an acquisition of a domain name wholesaler called Ascio in March  2019.It also made a small acquisition called Cedar Holdings that appears to be a mobile internet provider to increase the footprint of it's long held mobile internet provider called Ting.
    Moving Lawn Chairs on the Titanic
    These changes are tantamount to moving around a few lawn chairs.There needs to be a change in structure that will promote new growth.And that is why many shareholders are awaiting the proposed report to major shareholders on or around May 31.It will be presented to major shareholders by Laurel Hill and one or two consultants.There may be a concrete proposal about new directions to take as well as a proposal to remove several board members that are paid too much for guarding domaine names.Either way this report should improve Tucow's bottom line almost immediately.And that should send the share price into the $90 level before Q2.               https://www.zacks.com/