Friday, October 21, 2011

Service Point Solutions - in the black, or in the red?

On May 9th, 2011, Service Point Solutions (the public company based in Spain ad the parent company of Service Point USA) issued a press release titled …..

……. “Service Point back in the black”

9 May 2011 – Service Point Solutions SA (ticker: SPS.MC) registered growth in all its key income statement headings in 1Q11. The first-quarter release marks the company’s return to profits.

In that press release, SPS also said …..

…... “The company expects to post over €20 million in EBITDA in 2011”

Recently, we did a post about SPS’ Financial Results Report for the first half of 2011. For the first half of 2011, SPS reported a bottom-line loss (meaning, net “loss” instead of net “income”. (We clarified with SPS’ contact person in Spain that “BDI” stands for “Net Income”.)

From that first half report, here’s a quick snapshot of SPS’ first-half performance

in Spanish

in English

1st Half 2011



€ 110,554

Margen Bruto

Gross Margin

€ 70,694



€ 9,238



€ 4,281


Net Income (Loss)

-€ 576

I guess SPS could have issued a press release, after or when it released its first-half 2011 results, titled “Service Point back in the red”, for when you get down to it – meaning down to the bottom line (net income or loss), the bottom-line number was red, not black.

In order for SPS to achieve EBITDA of 20 mil (Euros) for the full year 2011, SPS’ performance is going to have to pick up in the 2nd half, compared to the 1st half, for first half 2011 EBITDA was less than half of the 20 mil projection. Perhaps the inclusion of recently acquired Holmbergs (Sweden) will help SPS get to the 20 mil EBITDA number. One question in my mind, will the second half see SPS truly return “to the black”?

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