Here are the Conference Call notes:
Kathy Roberts started the call with the usual Welcoming Statements introducing Cal Reed(CR) and David Archibald(DA).
CR started the discussion, ie. "forward looking statements," etc.. He then introduced DA who re-iterated the financial news release. He stated cash on hand is strong, to the tune of $22 Million.
CR then stated that VLNC has prevailed in the class action lawsuit. He also stated that the new coating/laminating lines are being installed. He is pleased with the progress of all VLNC's joint ventures. CR reviewed the Korea site last month and he was impressed with the progress. If all goes well they will be dedicating the site in the first half of '98. He then opened the floor to questions.
Questions(I didn't capture them all):
1. Query regarding new contracts with Reliant. How many, etc.?
CR - Stated the initial contract was for $1.2 Million to convert their flexible lines. Now 2 additional supplements(to initial contract?), to supply communications batteries for testing. If successful, Cal's hopeful of a followup military contract to supply the batteries.
2. (Red Chip): How much were the legal expenses for 1st part of year? DA - $750K vs $480K last year. Of course, there are other aspects to legal expenses that are ongoing, ie. patents, etc..
3. (Red Chip): Could you provide a status update on the N.I. plant? CR - Line 1 is undergoing significant redesign and should be back together in the 2nd half of Nov.. Line 2 has had several modifications which were generally successfully implimented. He's still expecting 1st qrtr production for both lines.
4. (Vantage Capital): Could you provide an update on the battery testing? CR - First off, battery testing will never be "at an end." They will always be tested because products change, evolve, etc.. Currently, batteries have been delivered to OEM's for testing and he is pleased with the results of these tests, to date.
5. (Vantage Capital): How real(ie. what are the odds) is the 1st qrtr production projection? CR - He won't specify the odds, but he's comfortable with all statements made to date regarding production by 1st qrtr '98. He did state that the only thing that might push that date out is if they have any problems with the lamination facilities, but that as of now, everything looks good.
6. (Private Investment Group): Does the recent GM announcement about accelerating their electric vehicle battery program have any impact on VLNC's relationship with Delphi? CR - He was unaware of any GM announcement, but no, as far as he is concerned, the relationship is good, and ongoing in the manner already set up(ie. pursuing automotive objectives). He see's no impact.
7. (Clarion Partners): What is VLNC's marketing strategy? CR - To pursue long term relationships with significant OEM's. He views Lithium Poly battery technology as an OEM technology(at least initially), not a consumer one. It should continue this way into the foreseeable future. It should be a very good market because no one can meet the demand, either now or, once again, into the foreseeable future. He also thinks there are opportunities in a retro-fit market.
8. (Private Investor): The batteries the OEM's are testing, are they from the production line(s)? CR - No. They're from the Henderson facility. Ultimately, all batteries tested will be from the production lines, particularly for final OEM approval.
9. What kind of 1st quarter financing is VLNC arranging? CR - They are still pursuing such options as: equipment financing(they own the equipment free and clear); private placement; and/or equity financing. No decision has yet been made. This decision is expected to be made in 1st qrtr '98.
10. (Private Investor): Are you considering licensing the technology to 3rd parties? CR - Since VLNC is operating under a licensing arrangement, this question is not being considered.
11. (Private Investor): What is the capacity of the modified lines? CR - He went on to state the capacity, which basically was a re-gurgitation of what this board already knows. He stated it in number of cells per minute, NOT in line shifts.
----------
Whewwww!!! That's about it. Sorry for any/all typo's, or incomplete answer's. I'm sure other's will add more, but I wanted to get this out. Cal Reed was his usual self, maybe slightly more lively. So, in a nutshell, everything appears to be on track, as per prior calls.
Regards!
John~ |
