Ascend Communications (ASND) Message Board

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Technology Stocks : Ascend Communications (ASND)

ASND 212.33

+1.1%

Nov 28 9:30 AM EST

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To: LEUTHY who wrote (1582)	1/16/1997 5:03:00 PM
From: Dee Jay	of 61433

Leuthy, before anyone starts screaming "they didn't make their numbers" we should look at Ejabat's remarks regarding the TNT and the GRF 400. With respect to the TNT volume production/shipments did not occur until December so TNT contributed verylittle to the 4th quarter even though it was introduced in September. The key word here is "volume" shipments. Ascend does not recognize sales until the product literally is out the door. Likewise, the GRF 400, which should contribute nicely to both revenues and the bottom line since there's nothing else like it out there, won't be shipping in volume until the end of Q1 or perhaps Q2. so it won't be contributing significantly until we see Q2's results in July. Without these 2 products ASND was still able to maintain a net of 23% for the 4th qtr. (41.1 divided by 177.5 revenues)even with the price cutting cited in the release. So much for concerns about maintaining margins, at least in this last quarter. The net per share increase (256%)almost paralleled the revenues increase (260%). Margins improved in the 4th quarter as net sales increased only 189% but eps increased 191%. As management had said before the 3rd quarter did represent some difficulty in maintaining margins but it appears that efficiencies and perhaps a different product mix enabled more to be brought down to the bottom line during the 4th quarter. I'll leave it to smarter heads to continue with the analysis and perhaps point out any flaws in my thinking. As to future portents, it's open season! Dee Jay

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