VALENCE TECHNOLOGY (VLNC) Message Board

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Technology Stocks : VALENCE TECHNOLOGY (VLNC)

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To: Peter Groninger who wrote (26244)	2/13/2004 11:40:04 AM
From: P. Ramamoorthy	Read Replies (2) of 27311

My guess is that they hope to achieve breakeven sometime this Fall. They are playing it safe by saying "later part of FY 2005" which gives them until March 2005. Their cash burn will go down in the next two quarters: less R&D slightly higher marketing costs steady G&A costs no depreciation lower number of employees no direct costs of mass production The old generation of N Charge sales increased 22%. The next generation N Charge (from ATL, China) will cost less and have higher margin. New national retailers will be added in April 2004. N Charge sales (90% of last qtr revenue of $2.7MM) revenue was $2.43MM. Guidance given was 10-15% higher for next qtr. Expect $3MM. With additional sales of K charge and U charge, they hope to get another $2MM for a total revenue of about $5MM for a quarter in FY2005. If their cash burn drops to $5MM, they have a breakeven. Stephan does not reveal all his cards. They may come close to breakeven or turn cash flow in FY2005. Watch the balance sheet to get a clue on how soon they will achieve the breakeven because the expenditure side is not hard to predict. jmo. Ram Ram

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