Revised Fourth Quarter Estimate.
Q499 E Gum Zicam Total
Revenue 800,000 8,200,000 9,000,000
Cost of sales 600,000 2,870,000 3,470,000
Operating expenses 550,000 1,200,000 1,750,000
R&D 120,000 100,000 220,000
Total expenses 1,270,000 4,170,000 5,440,000
EBIT (470,000) 4,030,000 3,560,000
Interest/Other
income 31,000 0 31,000
Interest expense (450,000) 0 (450,000)
Preferred stock
dividends (100,000) 0 (100,000)
Deduct for Minority Interest
in Gel Tech (1,612,000)
EBT 1,429,000
Income tax 0
Net Income 1,429,000
Weighted average shares outstanding 8,000,000
Earnings per share $0.18
Assumptions:
1. Revenue
a. Expecting lower gum sales than the third quarter.
b. Zicam sales based primarily on Nov 18 press release.
Orders were 5 x Q3 at that point (about $6 mil). I
believe that the company filled those orders and
received and filled an additional $2.2 mil.
2. Cost of sales
a. Gum 75% of sales
b. Zicam 35% of sales
3. Operating expenses
a. Gum based on historic avg.
b. Zicam $1 mil advertising + historic avg for other.
4. R&D
a. Gum increase due to nicotine gum R&D
b. Zicam increase due to clinical studies
5. Interest Expense
Notes outstanding at beg of quarter = $3.2 mil
Interest at 8% = $64k
Approx interest on loans other than Citadel = $225k
Amortization of warrants to Citadel and Intercontinental
Capital Corp = $75k
Amortization of 10% premium to pay half the
Citadel financing = $75k
6. Preferred dividends
$1.6 mil outstanding at beg of quarter at 14% = $56k
Amortization of warrants = ~40k
7. Minority interest is 40% to Biodelivery Technologies.
8. Income tax is 0 due to carryover loss from prior years.
9. Number of shares outstanding increased from 7.5 mil
at end of 3rd quarter due to exercise of options. |
