Rob Richardson's questions to NEW PACIFIC METALS (NEWP) leadership • Q1 2015
Question
Rob Richardson of Stifel questioned the forward revenue impact of the cancelled collaborative agreement, the company's criteria for M&A, and the expected rate of operating leverage.
Answer
CEO Bob Phillippy stated the 2015 revenue impact from the cancellation is minimal, but anticipated 2016-2017 revenue will not materialize, though the customer relationship remains strong. CFO Chuck Cargile and CEO Bob Phillippy detailed their acquisition strategy, focusing on accretive deals with complementary technologies and channel synergies. Cargile also noted that while leverage will continue, the rate seen in Q1 is unlikely to be sustained as they approach their 15% operating margin target.