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Is that a Light at the End of the Tunnel?

Hello All,

It’s newsletter time again. Can you believe it is September already? Wow, where has the year gone? As I write this, I am in Denver at the Commercial Integrator’s Expo, a new show created by CI Magazine with the hope of becoming a marketplace for the type of products integrators, like Lone Star Communications, use for their customers. Conceptually, the new CI Expo is a replacement for the old NSCA Expo which became part of Infocomm 10 years ago, leaving a void for companies like ours to see the newest products available. CI Expo is collocating this show with CEDIA Expo, which is a commercial show for consumer products mainly for smart home technology. As this is the first year, the traffic is light in the commercial part of the show, which is to be expected with any new startup. But this venue shows great promise and will likely become part of the Lone Star calendar.

ALAIRO – Our Investment in the Future

2023 has been a busy year for Lone Star Communications with the development of the Alairo product. Created by Lone Star Communications, Alairo provides valuable services to our hospital customers that their customers have been asking for. As we further refine workflows and look for efficiencies in hospitals, Alairo will make the patient’s day better, make the health care clinical staff more efficient and more valuable to the hospital, and in the end, save hospitals money. These efficiencies will save all of us money and will lead to lower insurance costs for everybody. It’s a grand vision, but it’s a vision we feel strongly about and have made the investment to bring it to life.

We feel we have created something very valuable and for testing, have deployed parts of these systems in multiple hospitals. Though it has been fully tested and proven in the lab, we are testing it in pieces in North and Central Texas locations. We are about to deploy the full system in three locations including a site in Arkansas, to fully test the system in a live environment. These tests will be the most important tests so far and once complete, the full system will be available for deployment in all hospitals nationwide.

We are also working with our SD6 partners to make sure they have the information, training, and technical support needed to deploy Alairo on their own and support it long-term. We have been in discussions with Rauland about making it available to all Rauland distributors at some point in the future as well. Alairo is going to be a huge breakthrough for hospitals and a big product for Lone Star as well.

Arkansas Changes

We sold the Fire/Access/Sprinkler part of the business in the Arkansas markets in May this year as you recall. That has been a fairly smooth transition to shift all of that part of the business to State Systems in Memphis. It was our goal to help make it as smooth and successful for State Systems as possible and that would be the best result for our former employees and for our former customers. Those customers kept us in business for years and we wanted to make sure they were treated as well as they could be during this unpredictable time. Now that the transition is complete, we are in the process of realigning people and processes in the Arkansas offices. We are moving the Little Rock office to another building to allow State Systems to retain the larger office. Kevin Henderson is still in charge in that office and has done a very good job keeping up with all aspects of the transition as well as keeping the spirits up with employees. Kevin has committed to the sales position in that region to keep things moving while we search for additional sales staff. Thank you, Kevin, for that commitment. It takes a village.

LSC Year-to-Date

Lone Star is having a good year as you know. Though sales have been light for the first half of the year, sales are picking up and are expected to meet our projections by the end of the 4th quarter. Our challenge this year has again been to deliver products due to supply chain shortages. Rauland, our supplier for all of our nurse call equipment, has been challenged on component deliveries as you have read here from time to time. Rauland is starting to catch up on their deliveries and has shipped us a lot of equipment in the last month. This has allowed Lone Star to close out some long-delayed projects that were waiting on equipment. Rauland has shipped most products that were delayed over 90 days, and we are now in a dash to get these products installed and systems operational. Some of the projects that were delayed led to customers not granting additional projects. They simply felt if we could not deliver due to the supply chain, why award more projects? Now that projects are being closed out, our hospital customers are reevaluating some of the older proposals and awarding contracts.

Our ability to close out these ‘catch-up’ projects is exactly what Lone Star Communications needed. We need to get as many projects off the books as possible. Mostly because our customers deserve to have these projects completed and also because Lone Star can now begin to recognize profits from these projects. We simply cannot profit share until we see profit and that is starting to happen.

Coming Up Next

While disappointed we had to cancel our Town Hall meeting today, we are committed to providing valuable information to you and just could not get everything together in time and won’t waste your time with anything less. We may have a makeup Town Hall, but we will have our October Town Hall (October 7th) at which time I will present our financials and profit sharing for the year. Between COVID, employee shortages, and supply chain issues, we have had a challenging 3 years. But we have weathered the storm and see the light and the end of the tunnel. Of course, we expect there will be other challenges, and we are well-positioned to take the challenges presented and deal with them.

Thank you for what you do at Lone Star Communications. We know we cannot be successful without each and every one of you.

Until next time,

Ray, President



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