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Technology Stocks : Network Associates (NET)
NET 242.42+4.1%3:19 PM EST
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To: Edwarda who wrote (5639)8/7/1999 1:03:00 PM
From: Chuzzlewit  Read Replies (2) of 6021
 
Since we are talking seriously, that explanation won't hack it either. Here's the reason. As I recall (and I'm working on memory here because I burned all of my NETA documents after I fashioned them into an effigy of Mr. Slyme) NETA had A/R of around $250 MM after the writedown. Now, assuming that real sales are around $90 MM for the quarter (and I'm being quite charitable here) we would get a DSO of (250/90)*91 = 250 days!

So it isn't one large customer -- unless you believe that the bulk of the A/R is owed by that one large customer. It seems to me that the problem is that inventory was dumped into the channel, and sales were recorded without any enforceable agreement regarding payment.

TTFN,
CTC
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