Possibly good news from Japan.
Bob, I recently bought 2k shares around $5.25 based on the company's
fundamentals, the stock price being near a 52 week low, new product initiatives, the funding from BankBoston, and the following information from the last 10K. I suspected that BankBoston would not have been as generous with the loan if the Japan business was not very encouraging.
In 1997, the Company derived 39% of its total revenue from one customer, Toyo
Officemation, Inc., one of the Company's distributors in Japan. Health claims
processing systems represent 90% of this revenue. The Company has received
orders from this customer for ten image scanning and OCR transports, valued at
approximately $6 million, to be delivered in the first quarter of 1998. These
orders bring the total health claim processing systems ordered on this contract
to ninety-five. The Company's original expectation was for one hundred and
fifty systems to be delivered over the contract life. The efficiencies created
by the application of the Company's technology will reduce the overall
requirements for this contract. This customer is currently evaluating its
system requirements going forward. The Company believes that with the
continued pressures on the Yen and the objective to reduce the cost of medical
fee processing in Japan, the customer is faced with a challenge to continue to
improve their efficiency. The Company expects to receive the results from this
internal study in the second quarter of 1998. The Company believes that
success in achieving the initiatives described below will help offset a
foreseen reduction in sales from this customer. The inability of the Company
to meet these initiatives may have a materially adverse effect on earnings. |
