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Technology Stocks : Alcatel (ALA) and France -- Ignore unavailable to you. Want to Upgrade?

To: MikeM54321 who wrote (3242)	4/27/2001 9:25:24 AM
From: Dale Baker	Respond to of 3891

They lowered the range for 2001 to 5-15% from 20% due to uncertain US market.

To: MikeM54321 who wrote (3242)	4/27/2001 11:13:12 AM
From: elmatador	Read Replies (1) \| Respond to of 3891

Alcatel May Have Trouble Hidden in Its Balance Sheet Edited by Hugo Dixon Alcatel SA's results may be only good on the surface. The French telecommunications-equipment manufacturer posted a 21% rise in first-quarter sales and a 4% increase in operating profit -- roughly in line with forecasts. Its revised estimates for the year were also better than many feared. Given the lack of visibility in the sector, Alcatel allowed itself a lot of leeway. But forecast sales growth of 5% to 15% looks good in comparison with peers like Nortel Networks . For the complete set of comments go to breakingviews.com The devil with Alcatel is in the detail. And the details are all tucked away in the balance sheet. Inventories have jumped more than 80% in a year and receivables are up 24%. Days of sales in inventory have reached 145, compared with 99 at the end of December. Anything over 100 should set alarm bells ringing. Some of this inventory is probably unsold mobile handsets, a business that Alcatel said cost it 150 million euros ($135.5 million) in the first quarter and would still show big losses in the second quarter. But the inventory could also include outmoded networking equipment, which might eventually require a write-down. Restructuring costs are another worry. They totaled 139 million euros in the quarter compared with six million euros in the same period a year earlier. Alcatel has recorded such charges in each of the past nine quarters. The fear is that the company may be bundling normal recurring costs into this category, thus making its operating profit -- the number investors watch more closely -- look better. Then there is the question of vendor financing. Alcatel says it has booked a provision in the quarter for the $700 million (780.8 million euros) in convertible preferred stock it bought in Canada's troubled 360 Networks as part of a cable deal. But it isn't clear how much of the exposure Alcatel has provisioned. Losses on investments for the quarter, where the provision would have been booked, totaled 354 million euros. Alcatel may have impressed on first-quarter sales. But with a balance sheet like that, problems may be in the post.

To: MikeM54321 who wrote (3242)	4/30/2001 11:14:03 AM
From: zbyslaw owczarczyk	Read Replies (1) \| Respond to of 3891

few notes from CC regarding new products: # 7770 core routers in several filed trials (much more lab trials) with major US IXC, CLEC and two large carriers in Europe # sales of 7670 (from Newbride) IP+ATM +MPLS switch router (50Gbit/s version) very strong and gaining momentum (over 500 unit sold) and if my memory is correct average price is at least 1 million. within next month or two software for 450 Gbit/s version will be ready and sales will come in second half # metro product will take off in second half. in addition to Europe major customers are large carriers in N.America, including US. # terrestrial optical system will grow faster then submarine this year # growth in Q2 Y/Y and sequential in single digits, b/c of handset(10% without handset) #carrier networking will see 50% growth in 2001 , and optics 25%. ALAO, component division will grow 50% this year, in single digit sequentially(Q2).still adding people and expending. new products include metro