In response to Bill Sharp's latest question regarding capacities, I do not think the 240 mm bicells referred to existing production capabiliaties as of last summer. I also understand company management to be stating that "normal full production" would be around 7 - 8 million cellphone batteries/year, which I translated to mean 7.5 mm @ $ 8/battery or $ 60 mm revenue/line for cellphones. Laptop production, if Line 1 comparable capabilities were any indication, was roughly 50% in the number of batteries produced (line 1, you may recall, was to produce approximately 4 mm cellphones or 2 mm laptop batteries per year).
Now these production levels have not been achieved to date in either line, I believe, and it is my understanding that line 2 can currently produce around 4 mm celllphone batteries per annum, and line 1 at around 2 mm laptop batteries. I remain confused as to what is "normal full production", but I too think the company means 2 shift/day production. So at what I believe are the current rates of production (2 mm laptops and 8 mm cellphones per year) the company's annualized production should exceed $ 100 mm.
Company management says theei engineers are conrfident that they can reach their "normal full production rates" , ie the 7 - 8 mm rates for lines 2 and 3, sometime next year, which should increase the annualized run rates for the first 3 lines to somewhere between $ 150 mm and $ 180 mm/annum. (Line 1 is not expected to exceed 2.5 mm laptop batteries per year, but I still do not believe that these will be sold below $ 30/battery.)
Anyway, the business becomes one, as I said before, of judging the capabilities of line 2, 3, etc, then counting the subsequent lines as they are installed.
Finally, settlement of the lawsuit may clear the way for licensing deals of the VLNC technology, and that question should be asked at tomorrow's conference call. |
