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Microcap & Penny Stocks : THNS - Technest Holdings (Prev. FNTN)
THNS 0.00Jun 7 5:00 PM EST
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To: watcher who wrote (5500)9/9/1998 9:53:00 AM
From: Michael T Currie  Read Replies (1) of 15313
 
I made the mistake of posting this early last week when everyone was waiting with baited breath for results of the office visit. I am reposting it in an effort to stimulate some healthy discussion about the future of FNTN.

Each case (minimum, most likely, and maximum)
depends entirely upon my own assumptions, so feel free to argue
differently as you see fit. The basic data is crude because of the
lack of information, but I think this serves as a valuable exercise
in 'what could be'. I guess we could choose mid 1999 as a reference
point for this snapshot.

Minimum Case

Revenues/Client - intranet construction and maintenance: $0.5 MM
No. Of Clients: 5
IDB Revenues: 0 (deal not consummated)
Total Revenues: $2.5 MM
Company Expenses (salaries, hardware, miscellaneous): $1.0 MM
Consulting Contractor Fees: $2.0 MM
Taxes: $0 (tax loss carryforward)
No. Shares Outstanding: 25 million (share sales to cover ongoing expenses)
Profit (Loss): ($0.5 MM)
Profit (Loss) Per Share: ($0.02)

'Most Likely' Case

Revenues/Client - intranet construction and maintenance: $1.0 MM
No. Of Clients: 10
IDB Revenues: $2.0 MM
Hill Publishing Revenues: $5.0 MM (10000 clients @ $500/client)
Total Revenues: $17.0 MM
Company Expenses (salaries, hardware, miscellaneous): $2.0 MM
Consulting Contractor Fees: $5.0 MM
Taxes: $3 MM (after tax loss carryforwards)
No. Shares Outstanding: 19 million (as recently suggested)
Profit (Loss): $7.0 MM
Profit (Loss) Per Share: $0.37

Maximum Case

Revenues/Client - intranet construction and maintenance: $1.5 MM
No. Of Clients: 15
IDB Revenues: $4.0 MM
Hill Publishing Revenues: $12.5 MM (25000 clients @ $500/client)
Total Revenues: $39.0 MM
Company Expenses (salaries, hardware, miscellaneous): $3.0 MM
Consulting Contractor Fees: $6.0 MM
Taxes: $5 MM (after tax loss carryforwards)
No. Shares Outstanding: 16 million (company repurchases)
Profit (Loss): $25.0 MM
Profit (Loss) Per Share: $1.56

This exercise is not designed to reflect reality. I certainly don't have access to the required numbers. I have made a very strong assumption that unit costs will fall rapidly because of a degree of cookie cutter type service. Fees rise in absolute terms through the three cases due to the customization aspect, but fall as a percentage of revenues.What it should do is make you think about the possibilities. It is marginally better than saying 'I think the stock price will be $x.xx at the end of the year'. Have fun with your daydreams.

I would really like to see some comments about my assumptions.

Mike
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