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Technology Stocks : Truevision
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To: Stewart Elliot who wrote (77)10/24/1997 8:13:00 PM
From: Elroy   of 216
 
I would like to know what TRUV's gross margins are, and whether it safe to assume
that the company can grow revenues in the near future without significantly increasing
the company's overhead.

Well, from the last financial statement it looks like gross margins are about 42%. They made gross profit of about 4.2 million on sales of about 10 million, if memory serves right.

If they sell primarily through OEM arrangements they should be able to ramp sales significantly without increasing Sales/Marketing or General /Administrative expense. This is the advantage of OEM agreements, but it requires that the product have strong demand. In other words the OEMs have to pull the product, rather than have TRUV salespeople push the product. Research/Development expenses, of course, are unrelated to ramping sales, but if the sales appear to be increasing the company is also likely to ramp R&D since the outlook for the company will appear better and they'll be more comfortable spending more.

Did anyone listen to the conference call? Is there a playback number?
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