SCCI-SUPERCONDUCTIVE COMPONENTS Message Board

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Technology Stocks : SCCI-SUPERCONDUCTIVE COMPONENTS

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To: GARY P GROBBEL who wrote (7)	1/14/2002 1:26:05 PM
From: Crossy	of 16

Gary, SCCI could be an interesting opportunity into advanced materials (Nanotech) and superconductors. I was positively surprised when they finally moved from the PinkSheets to the OTC/BB this fall. Unfortunately it happened during a sad time (Sep 11). From their 10Q filings I saw that with their TargetMaterials division they achieved a "balanced portfolio" structure where they are not dependent on external financing (cash flow positive). In fact it seems that TargetMAterials (producing sputtering targets) is growing nicely. If you look at SCCI website they are hiring production related staff. Means that sales should be nicely going on. Moreover, SCCI firm was mentioned in a PR from Oxford Instruments - traded in London (ticker OXIG.L).(www.oxford-instruments.com). OXIG and SCCI are commercializing an architecture for a nextgeneration superconducting MRI with an "open tube" architecture. A research grant also was recently awarded on this matter.. The real issue here is not only the "open tube" characteristics. Even more important seems to me that the system is supposed to operate at 20K (instead of 1K as conventional LTS MRI systems do). This will allow for a cooling architecture with CRYOPUMPS (like in semi equip application) instead of cooling by means of liquid helium. Industry watchers think this might reduce MRI equipmet size by a factor of 3-4 and might move MRI systems placement from a strictly hospital based deployment situation towards a proliferation in a wider range of settings (specialist locations), probably more than doubling current market size. Now Oxford Instruments is not a jerky upstart but a well established firm in the superconductor domain. They own 50% of a JV with Siemens called Oxford Magnets and this firm holds 75% of the world market in MRI magnets. The other 25% is currently "owned" by IMGC (Intermagnetics) on the Nasdaq which is selling at a PSR of 4+. Not only OXIG.L (PSR of 0.4 right now - really cheap in London) is going to profit from the new MRI architecture but also SCCI if the system will be commercialized. SCCI is going to supply the specially coated SC wires in the system. Commercialization time is expected to require additional 18 months. Once the market welcomes the new "downsized" MRI the SC division of SCCI should experience a huge increase in momentum for their supply of the wires should amount to a nice cash cow due to recurring revenue and the proprietary process involved. apart from this, even if the new MRI takes longer to develop, SCCI is a compelling investment being cash flow positive and commanding a low PSR ratio of only 0.7 (exp. revenues for FY2001 around $3.6m) - Exp. Sales/share around $2, current quote OTC/BB : 1.25 Finally I'd like to point out that the number of superconductor related firms on world stock market is PRETTY LIMITED with only a handful of quasi-pure and related plays: IMGC, AMSC, SCON, CDTS, ISCO.OB , SCCI.OB and OXIG.L (London) and NKTC.CO (Copenhagen) best rgrds CROSSY

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