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Strategies & Market Trends : Technical analysis for shorts & longs -- Ignore unavailable to you. Want to Upgrade?

To: Johnny Canuck who wrote (39643)	6/1/2003 3:38:40 AM
From: Johnny Canuck	Read Replies (1) \| Respond to of 69990

SNDK CC: Shipments of megabits increase Q-Q, units up over 140 percent Y-Y, megabytes up over 200 perc Y-Y ASP's down 24 percent Q-Q, 40 percent Y-Y Tax rate 10 percent [Harry: they can't keep that up given that they are profitable again] More than 60 per of sales to the consumer market. 29 perc to OEM's. Strength in OEM sales offset consumer weakness Digitial Camera, cellphones, camera for cellphones, .... product segments expect hockey stick growth rate in next few years as demand takes off analysts see more cellphones cameras shipped than digital camera this year Have Not seen MU, Hynix etc ... in their market as of yet despite stories in press 100 perc utilization of existing fondary buying from Toshiba and Samsung to make up for shortfall in wafer fab shifting to 0.13 micron to get better cost structure generated 34 mil in cash for the Q GM 34 perc DSO 58 days up from 50 days Outlook: Rev flat with Q1 Retail sales will be backend loaded, take off at start of summer ASP will fall 10 to 15 perc GM 27 to 27 perc GM will be low 30's after shift to 0.13 micron fab Op Ex higher than Q1 Tax Rate - flat [Harry: Flat Rev would suggest increase unit shipments, as the gross margin is falling once again. The can't keep this up as at some point the increase in productive due to new technologies will not offset the ASP decline. This explains the reason SSTI is not profitable. Given the low ASP they need more volume before the become profitable. With the entry of new players with deeper pocket, whether SSTI survives long term is an issue.] Q: Unit shipments in Q2? A: Don't know. Expect ASP to decline 10 to 15 perc. Q: ASP's decline for year? A: Demand will increase in 2H. Will see a better balance of supply and demand. Will see 15 perc to decline per Q if that happens. Expect 40 perc price decline for the year if we get to 0.13 micron fab. Unit shipments will increase projected. No bookings yet. [ Warning: No backlog] Q: 89 perc consumer sales? A: No. mixing channels. Q: SD cards? USB? A: Working on SD cards. Working on USB. Q: On target to manufacture memory stick pro this Q? A: Yes Q: What drove OEM sales last Q? A: Some pick up in telecom and industrial. Consumers was strong. Q: Why royalty strong in Q? A: Drive by sales of licensess. Came in strong than expected. Q: Perc of production shifted to 0.13. A: No comment. GM effected by the shift. Some fab capacity off line during transiston. Depressing GM. Q: Lowest cost producer in industry. Where is production bottle necks. Bottle necks for competitors. A: Highest volume. One of lowest cost producers. Believe in technology as way to decrease cost. A religion. Expect to scale as technology improves. Bottlenecks for others. Tough product. Tough to get compatibility to all the formats. MLC provides a strong cost advantage. Q:Cap Ex? Joint venture commitments? A: 16.8 mil added for capital acq. Expect 40 mil in cap acquisitions in test to support subcontract relationships. WIll convert existing capacity from DRAM to FLASH, also smaller/denser technologies. By end of year all will be converted. No plans yet for new fabs. Should be 18 months out. If demand strong will pull it in.