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Strategies & Market Trends : MDA - Market Direction Analysis

SPY 689.10

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Jan 23 4:00 PM EST

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To: Zeev Hed who wrote (80006)	7/11/2001 6:21:15 PM
From: American Spirit	Read Replies (3) of 99985

BS! SCNT's burn rate is only 22-25 million per quarter, they have picked up a few blue chip deals lately and they predict a profit by fiscal year's end. The mistakes in your report would lead one to believe they're sliding toward bankruptcy when in fact they're afloat and have all but assured their own suvival. Assuming 25 million revenues a quarter (minimal) they break even after June and do not spend their remaining 100 million at all. You also underestimates their margins by a longshot. The current market cap now only 45 million as let's face it some people are just sick and dumping it at the bottom. "With respect to the June quarter, we estimate that our cash balance at June 30, 2001 should approximate $110 million compared to $161 million in cash at March 31, 2001. We expect to spend approximately $40 million of cash in the June quarter on restructuring activities related to both the December and March/June quarter actions. Approximately $5-$10 million is projected to be consumed by business operations and an additional $5-$10 million for capital expenditures and changes in working capital.'' ``Upon successful completion of our restructuring action, Scient expects to achieve annual cost savings of approximately $175 million and will have lowered its quarterly break-even point to a range of $22-$25 million. Our goal is to reach break-even by the second half of this fiscal year ending March 31, 2002. As a result of repositioning the business, our long-term operating model now targets a gross margin in the 45%-50% range and an operating margin of approximately 15%,'' noted Mr. Kurtz.

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