Go, the exec from EMC is really not from EMC, but from Data General. He probably got "displaced" during the recent acquisition of DG by EMC and landed at ASPX. He was with DG since 1993, years during which DG was struggling to stay afloat. I don't know the guy and his record, but he had a chance to turn around DG, he did not, so you got to ask yourself if he is the right guy to lead a turn around situation. Technically, in recent days, ASPX looks very good with OBV and money flow improving, but at their current sales rate of around $22 MM per quarter, they are barely breaking even on gross profits, and with about $22 MM in SG&A charges they must more than triple their quarterly sales to break even. To triple their sales, they will probably need to increase their working capital by some $40 MM (taking their current accts receivable and inventories of $25 MM as of end of March). However, they have less than $30 MM in cash and are burning $20 MM per quarter as it is. I don't know where that money is going to come from (to get them to positive cash flow, and not talking earnings yet), but it is surely a very difficult turn around situation.
Zeev
irrevolute.iuma.com |
