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Technology Stocks : Luminex Corp. LMNX

LMNX 36.55

-3.2%

Jan 9 9:30 AM EST

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To: Hungry Investor who wrote (29)	3/31/2000 9:04:00 AM
From: Hamilton Rogers	Read Replies (1) of 47

Income Will Be Derived From Three Sources In The Future Scott, My understanding is that about one machine per day is going out the door and that there is a backlog of orders. Device sales will surge for the year but Luminex is like Gillette selling razors on the cheap to get blade sales. I think there is a fat margin in the devises because the alternatives are so expensive. Just remember that the sale of devices represents a finite universe and is really just a means to an end. The razor blades are the microspheres sold in bio-array kits. These are being developed by the collaborative partners who finance their own R&D and pay a licensing fee to LMNX. The margins in the bio-arrays are huge! The third source of income is the backend royalties which are associated with each test made and have no associated costs. The royalties are shared with the collaborative partner and are the reason they have invested their funds to develop a specific area. Once the Luminex platform is established with a portfolio of bio-arrays which can be distributed, the income stream will ramp up quickly as the business model appears very scalable. The actual manufacturing of the different bio-arrays may a possible bottleneck. My information is that the devices are geared to an assembly line speed with the opticals being installed in Austin. All customers have been upgraded to the third generation device and are very pleased. I have never seen a company like this. It's incredible! Regards, ham

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