Catapult Communications Inc (CATT) Message Board

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Technology Stocks : Catapult Communications Inc (CATT)

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To: jbkelle who wrote (168)	11/8/2000 8:04:31 PM
From: Byron Angel	of 184

Conference call highlights The recent problems in certain subsectors of the telecomm industry have had no impact on CATT and are not expected to have any. The market for CATT products remains very strong. US demand for VoIP test products looks extremely strong and there is a "buying panic" for 3G test products. Demand in Japan is very strong for 3G products. A year ago CATT lost some business to Able Telecom of Japan. They now have this business back. Over two thirds of all sales in the September quarter included one or both of 3G or VoIP products. The company currently has an unusually large backlog. There's virtually no chance they won't make their numbers in the current quarter. The one problem CATT continues to face is finding enough qualified engineers. Their goal is to spend 10-15% of revenue on R&D to meet the demand for new and improved products. They need more developers/engineers to reach this goal. CATT has the broadest range of products in the market and they are adding more all the time in response to growing demand. Telecomm equipment manufacturers are more and more giving up on developing their own test solutions and are turning to CATT instead. The technology is just moving to fast for the manufacturers to develop their own test protocols. CATT is not facing any new competition although the existing competitors such as Agilent are still around. Right now the demand exceeds the supply for telecomm test solutions. CATT now has 8 sales offices worldwide and has relationships with all the major telecomm manufacturers. They are increasing the marketing effort directed at the telecomm manufacturers. Management gave the following guidance for the fiscal year that began Oct. 1: Q1 sales $7.9m eps .14 Q2 sales $8.4m eps .14 Q3 sales $8.6m eps .15 Q4 sales $8.8m eps .15 FY sales $33.7 m eps .58 Given the very bullish statements made by management in the call the analysts were surprised that the guidance wasn't higher. Basically management responded by saying that we're sure we can make these numbers and when we're sure we can beat them we'll let you know. There was some discussion about putting out a press release later in the quarter to provide some upward guidance.

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