Aug. 11 at 9:34 PM
$ESOA another abysmal quarter from 'Book Value Doug' (book value is ~
$3 and probably where this trades) with EPS down 78% and EBITDA down 40%
The electrical segment revenue has topped out with margins declining - he now admits last year "was more profitable than expected" and new, lower margins "have been in line with expected profit margins"
The water segment is growing but at a much lower margin. He has disclosed American Water as an over 12% customer for the first time and this accounts for the bulk of their non-Tribute growth. We can surmise he bid a very large amount of business very competitively - in a bad case (last Q) they lose money and in a good case they make a very low margin on high volume
They historically lose money in FQ1/2 and make it in FQ3/4. After last quarter's insane (0.41) EPS they will obviously have aggregate negative EPS this year and maybe EBITDA come out to ~
$10M putting them at 20x EBITDA. Outsized losses, leverage, capped margin upside means book value
