Ron, llccman or rj,
I was wonder if you determined what was higher in S,G&A for the fourth quarter of 2000? Cost of sales was 85% of sales for the current year, as compared to 87% for the prior year and net interest expense was 2% of sales for both years. Total other operating expenses for 2000 was 12% of sales compared to 8% for 1999. A lot of it is probably due to higher sales efforts. Executive salaries do not seem to be out of line.
I did see that reserves for doubtful accounts are 8.5% of receivables for the current year compared to 5.7% for the prior year, which is good, rather than having VALH trying to push as much as possible down to the bottom line. I also noticed that finished goods for the current year of $17,846M were 15.6% of sales as compared to the prior years finished goods of $6,953M or 15.0% of sales. At first, I was worried about the higher finished goods inventory but it is in line with the increase in the current year's sales.
The only thing that we really need to be concerned about, the way I see it, is financing. Most of the debt is current this year and VALH needs to establish new debt or get an extension on the old debt, so they will have funding to pay off the current debt.
I see that we did get an "E". I haven't seen how quickly VALH will be able to get it removed.
I would be interest in any thought you may have regarding the current 10-K and VALHing's future.
Take care.
Scoobey |
