Rex's revised profit predictions for 4Q96.
In my previous earnings projection, I assumed that there was no increase in expenses. This is not totally reasonable. I should include the hiring of some personnel. Even though 7 jobs are still posted, I am going to speculate that they probably hired 4 engineers, and lets add another 4 people to the roster in Sales, General, and administrative. From the prospectus, they had 22 product development personnel, and spent $526K on R&D that Q. That's $23.9K per engineer per quarter. If sales and admin are about the same (conservatively), then the total EXTRA expenses for the new employees would be ($23.9K*8)=$0.1912M in the Q.
Now revenues is the key issue. Based on the backlog numbers that were reported, I am going to stick with my original estimate for Battery Management revenue increases. I will conservatively leave the NVSRAM and RTC product revenue flat with the previous Q.
So, this brings us back to the estimates. Battery Management was $5.38M last Q, up 30% sequentially. If they are up 30%, that makes it $7.0M in BM sales. Add that to last Q's non-BM sales of $5.092M and we get $12.1M, just as I had speculated before.
Revenues would be up by $12.1M-$10.5M=$1.6M. Apply the Gross margin of 45%, and we get a gross profit of $0.72M. Subtract the increase in expenses of $0.191M, and we get a net pre-tax income increase of $0.529M. Add this to what they earned last Q ($2.105M), and we get $2.634M net pre-tax earnings. With taxes assumed at 35%, we get $1.712M in fully taxed earnings. With 7.334M shares outstanding, that leaves a fully taxed EPS of $0.233.
Summary(in 000's except per share data):
4Q96
Revs $12,100 est
Earnings $1,712 est
EPS $0.233
Earnings and earnings per share are assumed fully taxed.
Rex Dwyer
The earnings estimate given above is from an amateur stock analyst. Professional analysts have lower earnings estimates than posted here. Rex Dwyer does not have any contact with management to guide estimates. Benchmarq does not publish any forecasts on future earnings, nor do they endorse any third party forecasts. There are two firms that follow Benchmarq and they are ComVest and Needham. |
