This quarter is the first published with the consolidation of Sharing Global Services in the income statement. It has a March fiscal year, so we haven’t seen its fourth quarter yet, but we expect it to have added about $6 million to revenue and $2 million to loss (excluding impairment of $1.5 million). As expected, its addition put DSS SSD back into negative cash flow territory – $3.4 million for the quarter. Its turnover seems to continue to decline year after year. Premier packaging had a tougher quarter than usual. Although it has an excellent pipeline and orders, it continues to be limited by paper shortages and suffered a few days of downtime following the move. We expect Premier’s Q2 revenue to be similar to Q1 until it resolves its paper issue. It too is also affected by the rise in paper prices.
With the market collapse, DSS’s current enterprise value is now $45 million, or 0.7 times estimated EV/2022 sales. The plan is still to create a spinoff of the biomedical, REIT and banking business — all three of which could happen this year, and those should only improve returns for investors. Although in the current market, plans could change.
DISCLOSURE: Zacks SCR received compensation from the issuer directly, an investment manager or an investor relations consulting firm, engaged by the issuer, for providing research coverage for a period at least one year. Research papers, as seen here, are part of the service provided by Zacks SCR and Zacks SCR receives quarterly payments totaling a maximum fee of $40,000 per year for such services provided to or relating to the issuer. Full Disclaimer HERE.