Bob: While I hope your conclusions are correct, I disagree with your analysis leading to those conclusions.
Re:"I don't think AZ's comments are mysterious at all. P-Gild and Ultrabeam sales will
not create significant profits for UTEK until 1999. AZ was addressing 1998
specifically, according to the quote, and is rightfully concerned about that, IMO."
Art Z was concerned about the "(business) plan we've put forward for 1998" and your post seems to suggest that P-Gild and Ultrabeam are not a part of this plan because no "significant" profits will be recognized for these products until 1999.
But Art was not talking about "profits" necessarily when he talked about the "business plan." I don't know if you had the opportunity to listen to the last conference call, but a huge part of the business plan for 1998 was to begin the production ramp-up for P-Gild and Ultrabeam. Art said that he wants to build a 150,000 square foot facility for "major production increases in both Verdant Technologies and Ultrabeam Lithography." He said then that they had not broken ground and that he would see how the "industry moves" before doing so. No facility construction in 1998 means no huge profits in 1999 as it will take 12 to 14 months after UTEK breaks ground to bring the facility into production. One question to Art then would be: "When you talked about concerns regarding your 1998 business plan, were you concerned about the road map for P-Gild and Ultrabeam and why?"
Re:"Semi-equipt spending is going to be used for cutting edge technology for those
companies who need to stay in the game; UTEK's trailing edge (for the moment)
technology will not be a priority with limited funds due to currency problems (SE
Asia) or shrinking profits (US companies competing against Asian companies
dumping chips, and the disk drive sector)."
Art may agree with you but as you know he never said this. In fact, I can make an argument for more interest in UTEK trailing edge products in the form of mix and match given the money concerns for these companies. But why bother to make this argument. It does not matter what you or I speculate he meant. In fact, it does not matter what Art Z said in the article so much. What really matters is what he meant to say and what he believes now.
Sure Art Z. has as much right to be paranoid as any other CEO. As an investor, I have as much right to be paranoid as well. When the CEO makes those kind of statements in the press, I will always wake out of my "don't worry - be happy" state of complacency and start to ask some questions, especially with Mr. Short sitting in the bleachers.
BTW, here is Art on October 23, 1997 during the cc when the Asian crisis started to unfold the previous day: "We are very comfortable where we are. The summer months are behind us. I am really pleased about that. The vacations and Europe being shut down for a month -- all that is behind me now and I feel much more comfortable that we are getting better visibility for next year in 1998 and beyond. So I feel comfortable that we are positioned nicely with our new businesses to grow our company."
What a difference a few days make. I would like to know what has changed, if anything, for his company since he made these statements.
I hope there are others here on the thread who feel the same way.
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