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Microcap & Penny Stocks : TSIG.com TIGI (formerly TSIG)
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To: REW who wrote (23581)4/3/1999 6:43:00 PM
From: Zeev Hed  Read Replies (9) of 44908
 
Bob, thanks for the info. I believe that margins means "gross margins", typically, what you get less the "cost of goods" in this case the army of telemarketers responding to the calls and their associated overhead. The 25% margins are to support marketing and SG&A and what is left is positive cash flow (plus about a million yearly for depreciation which is a non cash expense). If SG&A and Marketing are at the rate of expenditures of last year (about $3 MM per q), then we need a little more than the $625 K per month to break even. I fear that the recent realignment and start up of new divisions (that may take some time to provide positive cash flow) could make the hurdle a little higher.

Note Amazon.com just borrowed a little billion bucks in the debt markets (no floorless there), that gives one an indication of the cash burn they expect before they turn positive cash flow.

Zeev
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