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Non-Tech : Simula (SMU)

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To: wally who wrote (1064)	4/3/1998 1:00:00 PM
From: Noblesse Oblige	Read Replies (1) of 1671

Wally has noted that the story today is much better than a year ago, despite the fact that the stock is at the same price. I think I agree...basically because we are "closer" to fruition on the ITS product family, which I consider the real value inside Simula. I know I will get disagreement (or perhaps even opprobrium!) from some, but the best I can see coming out of the 16G seating business (anytime in the near future) is an $ 80 million annual run rate with 15% pretax margins. After taxes, that amounts to just over $ 7 million annually, or 55 - 60 cents per share fully diluted. Nice? Sure. But how much is that really worth? On the other hand, ITS has operating margins of 25% - 30%, and may well have sales (depending on how many platforms it is utilized in) north of $ 250 million in a few years. On an after tax basis, that could be $ 3.50 - $ 4.00 per fully diluted share in earnings. That...gentle readers...is a big deal. Let us keep an eye on the ball. Go TRW. Go Delphi. Go Breed. I know what I dream about at night. <G>

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