May see much less seasonality Q4-Q1. Check this out:
Revs with and without PVC last year:
97Q4 LPAC + PVC = Total $7.27M + $1.69M = $8.96M
98Q1 LPAC + PVC = Total $6.80M + $1.25M = $8.05M (10.1%) from 98Q4
97Q4 LPAC $7.27M
98Q1 LPAC $6.80M (6.5%) from 98Q4
With "unprecedented" amounts of DVD work, growing feature film mastering business, and growth in HDTV, all offsetting any seasonality in traditional TV business, may see 99Q1 fairly flat from 98Q4, at $9M.
If costs and expenses are fairly flat, 99Q1 may look like this:
Revenues $9.0M (3.2%) from 98Q4
Cost Rev $6.0M flat with 98Q4(e)
SGA Exps $1.1M flat with 98Q4(e)
Interest $0.3M
Nt incom $1.6M
Dil EPS: $0.20 + 186% from 98Q1
Dil Shs: 7.9M based on 98Q4 preannouncement $1.9M+ and $0.24+ EPS
That would put trailing Q3/Q4/Q1 EPS at $0.46+
With seasonality going away with newer high-growth DVD/HDTV and film mastering businesses, and margins up, that would clearly justify fair value of 20 times $0.46+, or 12 times possible CY99 $0.75(e), or $9+ before summer.
Considering that 98Q4's 28% core business growth and high growth in new DVD work, etc, marks a dramatic change from the no-growth past, this may be the start of a long-term trend of strong double-digit growth rates.
In this case, maybe LPAC may earn $0.20/0.05/0.15/0.35 = $0.75 CY99
In which case, we'd be heading to $10.
But that's probably too optimistic. $0.60 CY99 may be the high end.
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