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Technology Stocks : C-Cor Electronics-CCBL -- Ignore unavailable to you. Want to Upgrade?

To: Gerald M. Gualano who wrote (58)	8/29/1999 3:47:00 PM
From: Ted The Technician	Read Replies (1) \| Respond to of 235

The mergers with Convergence.com and Silicon Valley Communications significantly impact the financial statements. After the pooling of interests, CCBL makes only 0.06 rather than 0.40ish in the June quarter. This is a negative in that the past earnings are lower than what CCBL had prior to the pooling. The positive is that the combined earnings growth is impressive - the June99 earnings are double the March99 earnings. Margins improved sequentially from Sept98-June99 (22%,24%,23%,27%). The earnings from operations growth should continue after the merger as product development costs slow and sales from SVC's product line ramps up. The growth of the combined SGA costs should slow as duplicate functions are consolidated. The 3rd Q should reflect a one-time merger cost though. From the June quarterly report: "The financial results of Convergence.com Corporation and Silicon Valley Communications, Inc. for the year ending June 25, 1999, reflect the fact that both companies were investing in technology and infrastructure and incurred costs in excess of their revenues. In the case of Convergence.com Corporation, this investment included the establishment of a state-of-the-art network operations center in Suwanee, Georgia, that is capable of supporting a large customer base going forward. In the case of Silicon Valley Communications, Inc., the investment included development of a product line of fiber optic based distribution equipment designed to meet the needs of broadband communication network operators."