I looked at Part V which states:
LAKE TROPICANA
Total estimated revenues: $114,400,000 (9152 intervals x $12,500)
Time frame: 12 months (average of 9 to 15 months)
Estimated contributing EPS for 1999: $.102($114,400,000 ö 223,920,708 shares, x .2(20% return of profit))
I have 2 questions:
1. You estimated the contributing EPS for 1999 as $.102. Is this assuming that all 176 units are going to be sold starting from January 1, 1999?
Most of the units will not be completed until past mid year and therefore can't be sold. So the actual EPS may be less than « of the estimated .102.
For example:
16 units completed by 1/1/99 = 12,500 * 52 * 16 = $10,400,000
40 more units completed by 4/1/1999 = 12,500 * 52 * 40 * 75% of year = 19,500,000
40 more units completed by 7/1/1999 = 12,500 * 52 * 40 * 50% of year = 13,000,000
40 more units completed by 10/1/1999 = 12,500 * 52 * 40 * 25% of year = 6,500,000
remaining 40 units completed by 1/1/1900 = 12,500 * 52 * 40 * 0% of year = 0
That totals out to $49,400,000 in revenues for 1999. Resulting in an EPS of .044 not .102.
2. The $12,500 per unit revenue that's used in the calculation ... is that for a lifetime timeshare? If so, should the revenues generated from sales be distributed over the lifetime of the timeshare (Ex. 20-40 years) and not all taken in the first year?
Mike |
