GRIN (Grand Toys International Inc) Message Board

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Non-Tech : GRIN (Grand Toys International Inc)

GRIN 27.26

+0.9%

1:06 PM EST

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To: Kevin Podsiadlik who wrote (463)	11/20/1999 11:52:00 PM
From: Frank McVerry	Read Replies (1) of 495

Kevin, FRANK SAID: The $14M cash position for GRIN was my year-end estimate, that is, the end of their Christmas 'inventory purchase-accounts received' cycle KEVIN SAID: That is, just a WAG. FRANK SAID My year-end estimate of GRIN's cash position in more detail: Option exercise $11M (assumes a complete option exercise by year-end) Estimated 1999 net earnings $2.3M Cash sheltered under depreciation $0.55M Interest saved on credit line in 4Q from option money $0.2M Total = $14M, based on 3.4M shares outstanding. This is $4.11 cash per share. If you use dako's scenario of taking the present partial option exercise and 3.07M shares outstanding and no further option exercise by year-end then you get $11M year-end cash or $3.58 cash per share. ***************************************************************** KEVIN SAID: Selling options does not make GRIN worth $8M more than before. If it did then I could make $100 million a year just by setting up a company that sold options on itself every month. FRANK SAID: If a business is worth $X million then that business plus $8M cash is worth $(8 + X) million **************************************************************** KEVIN SAID: Grand Toys once had a presence in the USA, but no longer does (thus the "International" part has become something of a misnomer). That right there says that some things have not gone well with GRIN in the recent past. FRANK SAID: Sounds like you're describing a turnaround situation here - they make very good investments. A turnaround with real growth prospects is even better and a tiny-cap turnaround with growth prospects is the best. Their US business, ARK, means that 'International' is still valid. Frank McV

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