Catalyst for SP Movement, page-2

Historically, December has been a reasonably quiet quarter for WRR, their softest for the year in terms of cash receipts across 2013 and 2014.

It will be interesting to see if IridiumGo and the other new initiatives such as of satphoneshop begin to make a positive influence to the top line. To me the main catalyst will just be strong operating results. The company has communicated that they expect ‘strong growth in revenues’, with $6.8m incremental revenue in 2015 adding to the core business.

Part of the attraction of WRR is that 60-70% of their gross margin is generated abroad, while operating costs are largely AUD denominated. I will be looking for gross margin expansion as a result of AUD depreciation and operating cost containment, albeit mindful of how quarterlies can paint a lumpy picture due to cash accounting.

If they can generate gross margins and maintain costs in line with historical averages, the share price will take care of itself.