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Politics : Ask Michael Burke

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To: S. maltophilia who wrote (81210)	5/29/2000 9:26:00 PM
From: Mark Adams	Read Replies (1) of 132070

re FMO; the negative cash flow appears to be related to an increase in AR and paying down AP. Decreased AP + Increased AR & Inventory changes consumed 200M of cash flow. The goodwill issue is an excellent one, and reminds me of a much smaller company that went on an acquisition binge only to take on debt and goodwill that depressed subsequent earnings. Yet it's quite possible that depreciated assets are worth more than book value (I haven't gone to that level of detail). I tend to shy away from companies involved in Asbestos litigation. In your opinion, are they as culpable as the cigerette companies? There are certainly other companies in the sector that may be a better play; KDN was suggested as one. FMO crossed the radar screen first and happened to be on sale as a result of an earnings warning, so I nibbled. No indigestion yet...

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