AHTC Corp (AHTC)-formerly Advanced Health (ADVH) Message Board

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Biotech / Medical : AHTC Corp (AHTC)-formerly Advanced Health (ADVH)

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To: MC Niemi who wrote (117)	5/12/1998 4:56:00 PM
From: MC Niemi	Read Replies (1) of 371

I think I have figured out why the stock went down. It all has to do with margins. Gross profit as a % of sales in the 1st Q was 23.5% (in the 4th Q of 97 it was 26.9%) Operating Income as a % of sales in the 1st Q 98 was 11.8% (in the 4th Q of 97 it was 15.1%). These are significant drops from 1 quarter ago. There could be good reasons for this (or bad reasons). 1) change in business mix and 97 acquisitons are lower margin than previous business mix. 2) there is some seasonality to earnings with 4th Q being the highest margin quarter and 1st Q being the weakest. 3) company took some one time charges and expenses in 1st Q 98 which will not be repeated. 4) Bad news could be that competition could be comming into the marketplace and margins will be getting worse. I do not know the answer but somebody at the company should talk about this on the conference call. MC

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