Brightpoint - CELL Message Board

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Technology Stocks : Brightpoint - CELL

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To: Grabs who wrote (1598)	4/29/1999 6:03:00 PM
From: Brian Lempel	Read Replies (2) of 1999

*CC notes* Overall restatement of Press release issues. Problems to persist to year end. 3.1 mm units. 75% digital 45% NOK 25% ERICY 15% MOT 75% rev handsets 13% accessories 12% VALS (value added and logistics services) 70% of distribution volume of expected at march press release 200 basis points lower margins than expected on handsets strong competition by weak competitors "trading dollars"...expected to let up in coming quarters. operating cash flow of 39 mm!!! Latin America back to pre-devaluation levels. UK very weak, will likely dispose of biz by June 30 unless contracts are reached for VALS. Germany weak too but improving. Brazil strong after procurement issues---strong VALS market '99 EPS estimates too high. 5-10% rev growth overall for year 20-30% top line growth in 2000 consensus 2000 EPS is OK awards cycle for VALS contracts slower than expected. SG&A rose 5mm to 27 mm....very high...(interesting) headcount up to 1725....new hirees VALS requires high number of employees SG&A will not come down in future quarters re-evaluation of all biz segments....and very strong ficus on balance sheet management. MOT taking back strong share in Asia... ATI contract will contribute significantly to 2000...my own estimates call for a contribution of $.20-.25 contribution to y2K earnings. Pipeline good for domestic VALS market going forward. ERICY may outsource certain ops???? <lengthy boring discussion of reasons for procurement issues> -------------------------------- Q looks pretty bad. Stock may move down in short term. Stock is likely dead money (songle digits) for another 6 months...however, with contracts kicking in by 2000, stock should be valued in low-mid teens. Brian

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