That is a reasonably fair assessment - the numbers don't lie. To...

That is a reasonably fair assessment - the numbers don't lie.

To put the numbers in some context, since late 2012, WRR (in conjunction with Iridium) have been developing the GO product - this has obviously been a very lengthy and costly ($2.5m + R&D process) and has been the major reason why FCF has been low.

Since it was successfully taken to market in Mid 2014, Iridium has ordered USD6m of GO product from WRR. Management's view (as set out in the AGM presentation) is that there is "exponential" upside in revenues resulting from this product launch. Basically, what this means is that Iridium customers rather than buying a separate satelite-phone, will now buy a GO product instead - there is a fair bitof commentary about GO and the new markets it opens up in other WRR posts, so I won't bother repeating it here. WRR and Iridium Management are confident in the long term outlook for GO.

This successful launch of GO has also meant that "there is an increased awareness of the Company’s capabilities as an OEM presenting solid opportunities for growth, and Negotiations are currently underway on further OEM development opportunities. "

So there is significant 'potential' revenue upside from either GO, or these other OEM opportunities, building on WRR's substantial IP and R&D accumulated over the years.

"The cost base of the company can support sales revenues of three times the current size".

Other recent developments include the company now being debt free and a new commercially focussed Chairman from a private-equity background.

So if you believe WRR (and Iridium), GO will provide a significant and ongoing revenue stream for WRR, with the potential for new products to add further growth and diversification. The operating leverage will generate increasingly meaningful products.

The alternate view (equallly valid) is that WRR will just plod along with marginal profitability, investing capital in short shelf life products with a poor return on investment - which is how the market is currently pricing WRR.
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