Elliot -calm down.
Use this site for the prospectus with all the numbers in it:
sedar.com
I have no idea what was spent on the CES show, but I would guess that to rent floor space for 4 days at the largest Consumer Electronic Show in the world, to produce marketing material, to send 3-4 people, employ another 2-3 for the presentations so you can do business dealings, and the like might cost in the area of $US 200,000 to 300,000. They also must have pitched in for some of the Samsung/TVL press conference too. So that's around C$ 300,000-400,000. Just my guess.
As for financials, I don't think you'll see a loss anywhere near the 1mil level for the year just ended. These guys are very cheap and know how to squeeze every nickle out of the busines --I'd bet they'll be pretty close to breakeven one way or another.
Past financials: (I think Graham used TZ's .01/share and the 50mil shares, but the .01 is rounded up and incorrect).
97 96 95 9mo98
Revenues: 6.7mil 6.2 7.1 5.4
EBITDA 1.4 1.3 1.4 .8
EBIT .33 .34 .02
Net Income .23 .22 .01 (.1)
The 98 9mos include 500,000 for CVC license and 300,000 in SGA for marketing and personnel related to the V-Chip launch.
In the past (w/o V-Chip expenditures) margins were extremely high and cash flow very strong.
Gross Margins exceed 20%. In 94 adn 93 they earned 300,000/yr.
I've always figured that the Qtr-Qtr numbers aren't that important until they start feeding the inventory pipeline. Once that starts, you can look at earnings. This situation is like a biotech company with a new product just getting distribution. You can guage market sizes, penetration rates, margins etc...(which was done in previous posts back in the 600 message range I think). But, it's all just guessing.
Here's some numbers you can work with and let us know what you get.
Just looking at decoders for the moment, no licensing or anything else.
Cost of Decoder US$30/unit
wholesale price US$45/unit
retail price US$80/unit
Plug you numbers in. How many will sell in first 12 months? What is total size of market, what will initial pentration rates be? Guess marketing expenses (fairly low), convert it all into C$ (1.40), subtract taxes and away you go.
I guess you can look at things like, what if 2-3 chain stores with 500 to 3,000 stores look to sell 30-1000 per store? What if a few cable companies offer it on a monthly charge (nice profits in it for them)? If there's 40mil households with children <12 having an average of 2.5 TV's per house, how many might want this? Women are the purchaser's of these things. I don't know the answers. I don't think much will happen till the encoding starts up for real. Then it's worth advertising and ramping up. Nonetheless, as you can see, with these margins, small sales amounts have a huge affect for the bottom line. Give us your answers. |
