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Technology Stocks : VALENCE TECHNOLOGY (VLNC) -- Ignore unavailable to you. Want to Upgrade?

To: ikonoklast53 who wrote (24477)	6/24/2001 3:13:07 PM
From: Robert Cohen	Read Replies (3) \| Respond to of 27311

Those are indeed interesting numbers and give a general idea how important a single laptop order could be. One can assume that a high end laptop would have at a minimum a 50Wh battery. At the low end of $2/Wh that would total $100/laptop or $300mm/yr. If the order was entirely filled by Valence and at 30% margins that would be $90mm profit from a single OEM contract. I doubt however that we have the capacity to provide that kind of volume but does show that a single large contract can by itself lead to profitability. If they were supplied by one or more of our licensees at 5% that would be $15mm. An order of this size filled by a combination of direct Valence production and one or more licensees, would be somewhere between the 2 numbers. It is my understanding that Godevais, while he was at Dell and prior to the job offer was not directly aware of Valence and their product and that battery decisions were made farther down the corporate structure. For this reason I believe that it is unlikely that this notebook order would contain a Lithium Polymer battery. It does demonstrate how a single large order could provide Valence with the capability of reaching breakeven or even becoming profitable. The task is to ramp up production capability at NI and then get an order like this! I believe that Stephan will make this happen. Robert