The SEC Form 10-Q for the third quarter was just filed as of this morning.
By the company’s silence on this score, we may infer that the Private Bank lending and availability covenants were not breached (primary concern there was the as adjusted EBITDA calculation), at least as of September 30, 2017.
The next measuring date is year end. So we are about 50 days away from knowing that outcome.
As ever, Mattersight’s largest customers are slow in paying, with only about half of last quarter’s receivables collected as of Halloween 2017. Its revenues remain highly dependent on a few large customers with astonishingly strong negotiating leverage. That is reason to worry, going in to a likely tough pricing environment in 2018 [I am wisely assuming there will be no “big business friendly” Trump tax package (look at Virginia, overnight) — at least not until after 2018 mid-terms — or ever, more likely].
Finally, some $1.4 million in contracts were terminated during Q3 2017 — and the rolling four quarters ACV is essentially flat over the last two quarters.
With no miracle at Christmas this year, this is a sub-$2 stock. It has opened at $2.55 this morning (on very light volume) — we will see how long that lasts.
Be careful out there.