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Technology Stocks : Orbital Engine (OE) -- Ignore unavailable to you. Want to Upgrade?

To: John M Connolly who wrote (4497)	9/22/2000 10:03:14 AM
From: John M Connolly	Read Replies (1) \| Respond to of 4908

I emailed OE regarding the following points: 1. The end of the year financial results. 2. The need for the $20M and the resulting dilution. 3. The three new reps in Detroit,franfkurt and China. This is the response I received. Orbital's year to year financial performance has been in the past heavily influenced by income of a non recurring nature, eg, single licence fees, etc . This influence is diminishing as sustainable revenues (royalties, system sales and engineering services) grow. Last year we saw a 9% growth in this type of revenue to A$48.9m and these accounted for 95% of total revenue as opposed to 68% last year. Similarly operating expenses dropped 8.3%. We at Orbital are focussed on growing sustainable income and reducing operating expenses. Each individual business unit is measured by its ability to deliver earnings to the group and this is the key deliverable of each executive. One of the most exciting parts of our business is the prospect of being the dominant technology in the motorcycle industry, some 20 million motorcycle are produced annually with over half of these made in China. Orbital is dealing with the market leaders in the major market areas and has the opportunity to participate heavily in this market together with Synerject and other key suppliers. The capital raising earlier this year was primarily to ensure that Orbital was in a position to support this rapidly growing market and capture as much of the market as possible. The price of Orbital shares has increased substantially since the placement at A$1.28. Currently we are trading at $1.80 having traded as high as $2.10. The account managers in Detroit and Frankfurt and the representative in China are very easy to justify. Orbital's business is growing globally and our customer are in Europe, USA and China. We need to provide local marketing and support in each of this regions. The Frankfurt and Detroit managers are focussing on the automotive customers in these regions. In the past we have serviced these market with a combination of regular visits from Australia and expatriates on a tour of duty in these regions. Both these options are expensive so with the growing business a local presence is essential. Our representative in China played a vital role in concluding our licence agreement in China with Sundiro and has an ongoing role in business development. We intend to grow our presence in each of these regions. All this is to drive to more business, greater profits and improved shareholder value. Once again, thank you for your interest. Ken Johnsen Executive Director