James,
Just to set the record straight, from the very beginning of my involvement
here, I pointed out what seemed to me to be questionable behaviour by PMTI
management. You can see it in my first submission here, kindly relayed
by Bill McCabe, since I had not yet received my authorization to post:
techstocks.com
True, my interest was and is primarily laser hair removal - especially that
it be promoted to consumers fairly and accurately. However, on numerous
occasions I stated my belief that investor and consumer interests have a
great deal in common. It seems elementary that if a company's products
provide good value to consumers, then investors are more likely to profit.
I was attempting to warn investors, that as owners of the business, they
too have a responsibility to consumers, and would bear the consequences if
they did not take this seriously.
As Epilaser comes to market, we will have the opportunity to see whether or
not I am correct on this.
You say that the company lost your support when it was obvious that they
were not shooting straight with investors. Well, that is one of the things
that I believe I exposed, albeit mainly with respect to hair removal. But
it was mainly through hyping hair removal that the share price was promoted
from $2 to $16.625, was it not? But have they provided one shred of credible
evidence that Epilaser provides value for the consumer's dollars? You know
that my position is that they have failed to do so, and it is well-
documented in this thread. And unlike PMTI's paid-hypesters, I tried to
support my assertions with verifiable facts, to the best of my ability.
You say you are not obsessed with hair removal. Well, as I understand it,
you no longer have position in the stock, but those who still do, or may be
considering getting in, SHOULD be obsessed with hair removal, because that
is PMTI's stated future, along with laser skin resurfacing. They are
gradually spinning off the other businesses, and in time, the top and
bottom line may only be laser hair removal and skin resurfacing.
Recently, I provided evidence here, pieced together from SEC filings, that
TruPulse laser sales never reached the predicted levels - not even close,
and that there has been a huge decline in revenues, apparently due to CO2
tube reliability problems. But I had to do plenty of reading between the
lines, and comparison of numerous documents, to get anything approaching
a clear picture. It is discussed pretty thoroughly in reply 502 and 504,
so I will not rehash it now.
However, I have found another question for investors to consider - this time
regarding Epilaser revenues. I draw your attention to the press-release of
14 August 1996:
growth.com
"Georgiev added, "We anticipate shipping Epilasers by the fourth quarter to
begin fulfilling $17 million in previously announced foreign orders"
The $17 million appears to refer to the following quote from the press-
release of 15 July 1996:
growth.com
"Georgiev continued, "We have recently received orders for the Epilaser from
Europe and the Far East totaling $12 million, in addition to the $4.8 million
Epilaser orders from Canada announced on April 29.""
Well, how have they done? Epilaser is manufactured and sold by the Spectrum
subsidiary. Here is the same five quarter medical revenue data I presented
in reply 502:
Fiscal Quarter: F'96 Q1 F'96 Q2 F'96 Q3 F'96 Q4 F'97 Q1
Quarter ending: 31-Mar-96 30-Jun-96 30-Sep-96 31-Dec-96 31-Mar-97
Spectrum Revenue 500,000? 900,000? 1,500,000 3,200,000 1,767,000?
Tissue Revenue 1,618,510 3,881,490 3,300,000 1,300,000 724,510
Other Medical 287,909? 437,703 355,052 543,494 121,255?
---------------- --------- --------- --------- --------- ---------
Total Medical 2,406,419 5,219,193 5,155,052 5,043,494 2,612,765
As I explained in 502, there is some uncertainty in Spectrum's revenues in
certain quarters, but FY'96 Q1 and Q2 DO add up to $1.4 million. Also, FY'97
Q1 is well-constrained by PMTI's statement that revenues were up $1,267,000
compared with FY'96 Q1, and by the FY'97 Q1 Tissue and Total revenue, which
are high-confidence data. If anyone has better data, by all means post it,
but this is my best estimate, using public information.
My question is, what happened to the $17 million in foreign Epilaser orders,
they were supposed to start filling in Q4? The table shows a surge in Epilaser
revenue in Q4, followed by an apparent large decline in Q1. Keep in mind, that
Spectrum also sells the RD-1200 dermatological laser, so the revenue was not
necessarily all Epilaser. Even if it was, the estimated total Q4 + Q1, of
about $5 million is well short of $17 million. And why the apparent large
decline in Q1? These were long-standing foreign orders, which would not have
been directly affected by the then-pending US FDA clearance.
In November, a further $5 million Japanese Epilaser order was announced:
growth.com
With $22 million in foreign orders, one might have thought that the Q1
revenue would have at least held steady, or increased, not fallen by perhaps
40 to 50 percent.
Are the announced foreign orders still there? Have there been production
problems? I do not know, and I find nothing in recent press-releases or SEC
filings that explains this. Does anyone know the answer?
Ted Molczan |
