MSGI, take 2
NEW YORK--Traction and growth may be just around the corner for MSGI Security Solutions, operating in the United States primarily through its majority-owned subsidiary Innalogic, a developer and integrator of wireless networked security solutions. While third quarter results released in May continued a record of multi-million-dollar losses (the company had net losses totaling $7,562,046 over the past nine months, with just $1,882,335 in revenues), those results were released amid announcements of significant contracts or pending deals.
In March, MSGI announced a long-term consulting contract with the Jacob K. Javits Convention Center in New York City (home of ISC East), and on consecutive days in April the company announced a $20 million agreement to implement a citywide surveillance system in the Middle East, "with the security division of a multi-billion dollar firm," and the commencement of operations in the Caribbean and Latin America in partnership with Innovative Security Technology, a Trinidad-based integrator with clientele including the major oil and natural gas companies there.
MSGI president Joe Peters, former deputy drug czar under Gen. Barry McCaffrey, touts Innalogic's development of a secure wireless signal for company progress. "It's more about the signal than the equipment," he said. "Cameras have become the focus, but that's because cameras are most often connected to the signal."
For chief executive officer Jeremy Barbera, "This is the second MSGI. The first one I started in my apartment at the end of the '80s, and I grew it to about $250 million, and the concept behind that and this is actually identical." The first company focused on building "a full-service solutions environment in the data and analytics worlds," but got caught up in the Internet bubble burst and was affected by the attacks on New York City in September of 2001. He divested the company to Omnicom, then restarted his business focusing on the physical security and surveillance space.
"We have companies already involved in wire-tapping, encryption," Barbera said. "We're looking at other businesses--explosives detection, airport security systems--trying to pull together service organizations that support homeland security and law enforcement, so they can draw from us any number of solutions without having to go to four or five other vendors."
Notable, however, is February's SEC filing that contained cautionary statements making it clear that an influx of cash is needed soon.
Barbera sounded a positive note: "That's certainly going to be solved by the cash flow generated by the deals we've signed recently."