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Microcap & Penny Stocks : Globalstar Telecommunications Limited GSAT -- Ignore unavailable to you. Want to Upgrade?

To: dwight martin who wrote (16698)	9/12/2000 12:37:33 PM
From: Investartist	Read Replies (1) \| Respond to of 29987

Demand for Globalstar batteries strong! From VLNC yahoo board this week. VLNC is currently using the majority of its available capacity for shipments of batteries to QCOM for the Globalstar handset. CIBC Report synopsis: Investment Conclusion. They reiterate their strong buy rating on VLNC, and state the company is now shipping commercial volumes of products to two customers. Milestones appear to be in place to drive the rapid acceleration of the production ramp and positive results forecast F1Q results of a net operating loss of $0.25 per share ($9.3 Million) on revenue of $2 Million was ahead of their estimates of loss of $0.27 on revenues of $2.1 Million. They are leaving their estimates essentially unchanged at the current time. They've trimmed their revenue estimate slightly in Q2 due to a possible delay as Alcatel has requested a slight change to its package. This is potentially offset as Qualcomm is aggressively increasing demand. VLNC is ramping production slightly ahead CIBC's prior expectations and they expect VLNC to end the fiscal year in a position to meet their $100 million revenue target in FY2001. IBD Funding Update The company expects to begin receiving funding from the Irish Development Board for its Mollusk, Ireland manufacturing facility during Q2. The initial requirement was for the company to ship a minimum of $4 Million of product as a milestone (which will be met in Q2). CIBC believes this funding could approximate $14 Million. VLNC will be providing the IDB a business plan in August. Strong Demand for 2nd generation Lith-poly batteries VLNC began shipping its second-generation lithium polymer batteries. These batteries have a higher energy density than the first gen and the company has exceeded its energy density forecasts with its customers. Demand for Globalstar batteries strong VLNC is currently using the majority of its available capacity for shipments of batteries to QCOM for the Globalstar handset. The company indicated that demand currently exceeds capacity and that it is ramping quickly. We note that QCOM reported record shipments (31,000 units in Q3FY00) of Globalstar handsets during its last investor conference call. The current assembly line manufacturing the batteries has a capacity to produce 20 bi-cells a minute. CIBC believes that the configuration of the Qualcomm battery is 9 bi-cells per battery. VLNC is currently operating two lines running 24/7 for Qualcomm's requirements. This battery does not include any electronics with it. CIBC believes that VLNC may see additional follow on releases which would increase current volumes through the remainder of this fiscal year and through next fiscal year. French cell phone order will begin in Q2 The French cell phone has been delayed by one month due to the customer requesting that VLNC ship the battery with extra electronics. The customer is currently evaluating samples of this PCB and CIBC believes that VLNC will begin volume shipments of batteries within the quarter. These electronics consists of a PCB with two IC's. VLNC is outsourcing the production of this PCB assembly to a Scottish manufacturer who then assembles the PCB with the battery pack. CIBC believes the electronics will add $1.50 to the ASP of the battery but there will not be an increase in gross margins for the product. The electronics were designed in Korea and are currently being manufactured in Korea and shipped to VLNC. CIBC believes there is a significant trend towards shipping the battery with the additional electronics included. It also appears that the company may begin to become the prime contractor with the repackagers as subcontractors.