Thomas Group Q4 2008 Earnings Call Transcript

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2009-03-03 09:51:18.0

Tags: Call Transcript, Payback, Earnings, Sales Strategy, Sales Force Management, Sales, Seeking Alpha, Thomas Group Inc.

Question-and-Answer Session

Operator

(Operator Instructions) Our first question comes from Mark Jordan with Noble Financial.

Earle Steinberg

Hi, Mark.

Operator

Okay. We will move to our next question, Neil Goldman from the Goldman Capital Management.

Neil Goldman - Goldman Capital Management

What is, what kind of sales volume do we need to be cash flow breakeven now?

Frank Tilley

We need about -- between $1.8 million and $2 million a month will probably get us there. Our costs go up obviously, as a result of the cost of sales.

Neil Goldman - Goldman Capital Management

And at $2 million -- if you did $2 million, I mean at the current run rate which is less than slightly over a million a month, what's the burn? Is that 2.50 a month or higher?

Frank Tilley

It's declining for the first quarter. It's about in that range, yes.

Neil Goldman - Goldman Capital Management

Okay. And the other question on these new offerings, the cost reduction capital expense avoidance et cetera, what kind of payback are you showing potential clients?

Frank Tilley

We are showing clients an improvement of 5% to 8% on their profitability.

Neil Goldman - Goldman Capital Management

And on what kind of...so I mean, I assume it's less than one year payback on...

Frank Tilley

Yes. It is less. All of them have less than a one year payback. The longest one has a payback of about eight months.

Neil Goldman - Goldman Capital Management

So, they believe you a simple decision on their part to...

Frank Tilley

It should...it is a simple decision on a lot of parts. What we're finding now in the market is there are more levels of approval for all consulting projects. And they are going more slowly than they have in the past.

Neil Goldman - Goldman Capital Management

What's the average size of your proposals now and the range of them?

Frank Tilley

The average size of our proposal now is between $1 million and $2 million. Although, we have some that are meaningfully larger.

Neil Goldman - Goldman Capital Management

Okay. Well, thank you. And hopefully, the economy turns or at least your prospects do. Keep it up. Thank you.

Frank Tilley

Thank you, Neil.

Operator

Our next question comes from Mark Jordan from the Noble Financial.

Mark Jordan - Noble Financial Group

Good morning again.

Earle Steinberg

Hi Mark.

Mark Jordan - Noble Financial Group

 

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