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Technology Stocks : INVX Innovex Comdex Winner !!

INVX 22.36

+1.4%

Dec 23 3:59 PM EST

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To: Mark Oliver who wrote (2737)	11/2/1998 4:43:00 PM
From: Douglas V. Fant	Read Replies (1) of 3029

Mark, I reviewed INVX's June 1998 SEC Form 10Q. The good news is that INVX's total account receivable outstanding dropped in half from about $22mm to only $10.5mm. So INVX is carrying a lot of cash on the books and not too many AR's. The Form 10Q does not specify who INVX's AR's represent. But even if they were 100% SYQT's Accounts Receivable, (which they are not), with 18mm shares outstanding, that would be a less than $0.55/share impact. So my guess is that the SYQT bankruptcy is a "non-event" for INVX... Now on the subject of flip chips and flex circuits, I noticed something in the Form 10Q which I had previously overlooked. Innovex sees volume and profitability of its Litchfield Flex Circuit Division increasing moving forward.... (From SEC Form 10Q) "LPC's sales continue to increase as a proportion of total sales, providing over 30% of the Company's sales for the quarter and over 20% for the first nine months of fiscal 1998. The first phase of the new LPC automated high volume production facility continues to ramp up and contributed to the increased volume of LPC sales. The total cost of the facility and related equipment through the first phase was approximately $15 million. The facility, which is designed to produce large volumes of high end flexible circuits for various applications, is currently being utilized to produce the Head Interconnect Flex (HIF) for the disk drive industry. The HIF product provides a technologically advanced solution for the Company's customers which is believed to be significantly more cost effective than any competing new technologies. The largest portion of the Company's sales for the remainder of fiscal 1998 will continue to be generated by the Precision Products Division. However, an increasing portion of the Company's sales will come from the LPC Division due to the strong demand for LPC's high end flexible circuit products including the HIF. The Company expects that an increasing portion of the demand for disk drive head interconnects will be met by products such as the HIF. The magnitude of the increase in sales from the LPC Division will depend on the timing and acceptance of the Company's new Flex Suspension Assembly (FSA) product. The FSA will be produced by equipment currently in development which will automatically attach HIF's to suspensions. The sale of the InnoMedica Division will have an immaterial impact on sales for the remainder of the fiscal year." Sincerely, Doug F.

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