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Technology Stocks : SDL, Inc. [Nasdaq: SDLI] -- Ignore unavailable to you. Want to Upgrade?

To: jay silberman who wrote (364)	7/28/1999 6:50:00 PM
From: pass pass	Respond to of 3951

SDLI had a wild day (62 to 72 trading range) with relatively small volume. Someone (MM?) has made a lot of money.

To: jay silberman who wrote (364)	7/30/1999 11:19:00 AM
From: pat mudge	Read Replies (1) \| Respond to of 3951

SDLI's conference call held on July 27: Financial highlights from Mike Foster, CFO: 52% revenue increase year to year, excluding IOC, increase was 58%. Total revenue increased 15% sequentially. DWDM grew 175% year to year and 23% sequentially. Alcatel, Corning, and Lucent were each above 10% of revenues; 5 customers were over 3 million, and 12 were between 500, 000 to 3 million. US Gov't was 13% versus 16% last quarter and 31% a year ago. International revenue was 36% of total, up 160% year to year; Asia was up 50% y/y, equalling 7% of sales. 74% of sales were in communications versus 54% a year ago. Gross margins were 42.2% versus 40.7% Q1 and 31% a year earlier. Contributing to improved margins: greater product mix including DWDM, increased yields, better utilization of fixed manufacturing, and increased ramp of undersea fiber products. Earnings increased from .04 to .16 y/y, and excluding IOC they were .20. $27.6 million in cash and cash equivalents; inventory $2.8 million, DSOs 73 days vs. 69 days, primarily due to ramping in Europe. Corporate highlights from Don Scifres, CEO: DWDM growth was strong with 980 nm laser and pump modules leading the way. Reasons for dominance include patented grating stablization and high power. As the technology moves to higher channels, power and stabilization become more critical. This segment grew by a factor of 3 in 12 months. In Q1 the company announced a 4-year contract with Alcatel and in Q2 they ramped production substantially. The company also published results at a conference in Japan. They're the acknowledged leader in 980 nm undersea pump lasers. Other companies have taken notice and SDLI is now in qualification tests, gearing up for Q4 and 2000, both for Alcatel and others. Discussion of product lines for undersea products: 980, 1480, and 1455 nm Raman (?) amplification devices. In the last they've shipped for first field deployment and the units are being tested at a number of companies. Acquisition of IOC broadens product line into transmitter side of market, including 10 gig light modulators, a big market. They have an agreement with a major telco for this product and it could ramp in Q3 but will definitely be important in Q4. Summary of company goals to expand technology leadership, enhance manufacturing capabilities, and expand partnerships: Technology Now have 230 patents either issued or pending. Continued qualifications of next generation chips. Advanced chips in 980 nm and 1480nm. Have received 6 industry awards. Excited about technical position. Manufacturing Adding production shifts and adding facilities. Improving yields. Moving into 40,000 sq. ft. facility in British Columbia, shipping in 4Q. Added clean rooms and other facilities to 50,000 sq. ft facility in Santa Clara to meet 980 nm undersea production. Yields will improve further. Customers Signing for 10 gig and succeeding in 980 nm. Guidance: Last quarter we projected 10% sequential growth and achieved 15% sequential in Q2. This was based on DWDM and 10 gig modulators. We're guiding 20% growth (over 1H) for second half, based on 35% or greater growth in DWDM, weighted towards the 4Q. Ramping in 3Q. Q3 will have better gross margins with acceleration in Q4. Prospects in 2000 are improving with 50% or greater growth predicted. >>>>>> That ends the public presentation. I'll post Q&A later today. (Time for coffee. :)