Ann: Casa Systems and NetComm Recommended Transaction, page-110

I can really understand everyone’s anger and frustration surrounding the current situation. For anyone that cant understand this it wouldn’t hurt to look at the annual report to shareholders again from 19/10/2019 (4 months ago!)

DIRECT QUOTE......OutlookFollowing the substantial step up in scale in FY18, NetComm expects FY19 to be a year of consolidation to ensure a sustainable platform is in place to drive the next step change in growth expected for FY20:• Revenue is forecast to grow 15-20%. This forecast growth is dampened due to a slower than expected rollout of the nbn FTTC project (as flagged by nbn) and a slower rollout of the AT&T Fixed Wireless project. This revenue has not been lost, rather it is deferred to future periods.• Underlying EBITDA is expected to be at a similar level to FY18, with revenue growth offset by lower margins as the sales mix changes from higher margin Australian DPU sales to lower margin NCD sales and higher near-term component costs are incurred due to global industry wide shortages.• Given NetComm’s substantial opportunities in 5G, an investment of $9 million is planned into 5G solutions, of which $4 million is operating expense and $5 million is capital expenditure.• After allowing for our additional 5G opex spend, reported EBITDA is forecast to be in the range of $15 million to $18 million with earnings skewed to the second half based on our expectationYet the manas of customer ordering patterns.The investments we plan to make in FY19 will position NetComm at the forefront of a “once in a decade” technology wave, allowing us to be early to market with a commercial fixed wireless 5G solution with applicability in global markets.While our business is always subject to the ordering patterns of our customers, this will lead to our next step change in revenue and earnings which is expected in FY20 and we are as excited and confident as ever about the outlook for our business, when measured over a multi-year period.

........Yet management have recommended to accept an offer based on a 4-5 year low in the share price which lets be realistic has probably been manipulated to some degree to ensure there was no correction over the past four months in preparation for this offer. 

Peoples anger in management is justified if you ask me either they have been grossly misleading in the past 12 months or they are not being upfront now. Simply to say that we recommend the offer based on the premium on recent share price is not sufficient. Taking into account cash holdings and future revenue deferred to future periods, reported step change in revenue expected for FY20 they are getting company for lunch money.

Having said all this i do agree that the best case here is that it does sell to a higher bid as i am fed up with this stock and as long as the price is higher than the current offer, will not be sad to see it go. Management have shown there hand, why would anyone want to be involved in a company that is being run by people who do not want to be there.

Rant over. Best of luck to all holders on this one.