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Technology Stocks : MRV Communications (MRVC) opinions? -- Ignore unavailable to you. Want to Upgrade?

To: NDBFREE who wrote (41794)	12/14/2003 10:34:41 AM
From: NDBFREE	Read Replies (1) \| Respond to of 42804

Thought I posted this here on SI last night, but apparently something did not work. Had to say this less someone think I am favoring Yahoo over SI. My notes from the MRVC's 2002 Annual Meeting. Anyone who attended is welcome to supplement my notes or to comment on anything they disagree with; I asked question about the announcement whereby MRVC is supplying Marconi with IP based product to be integrated with Marconi’s SDH/Sonet product. NL indicated is has taken Marconi time to develop the hardware they needed to develop and he doesn’t expect MRVC to see financial benefit from the deal until at least 2Q04. Very impressed by both Near Margilit and Todd Rope. Did not realize before this, but apparently the 2 went to college together. Comment made by NL about the lean MRVC Corporate staff of 5 and the average age given that Near and Todd are 31 and Shay Gohen is 38. Very very impressed by Near Margilt, but not sure if I see him running a “commodity” business like Luminent. While it might be viewed as a step down for him I feel he could make a stronger contribution to MRVC if he and Todd had similar positions and spent a large part of their time working with customers, channel partners, etc. Detractors of NL will be happy to know that in the vote for directors he and Sholmo only received 87.5% while 3 other directors received 90.1% and 1 received 91% of vote. Noam mentioned the #1 goal of the management team is to return (note the word return) the company to profitability. Further he said to be profitable revenues need to increase 10 to 15 million per quarter (with right product mix so as to provide appropriate gross margin). Shay indicated during his presentation that over last six quarters they have reduced operating expenses by some 10 million per quarter. Headcount has gone from 2200 to 1300 currently. Still aimed at reducing operating expenses, but Shay indicated in future most gains will come from increase in revenues and improvement in gross margin. I did not say anything at meeting, but Shay showed loss per quarter in terms of cents/share. This tells 1 part of story but since number of shares have increased, I would have liked to see them show it express in $ per quarter. Meeting/presentations focused primarily on MRVC domestic efforts. Very little (to nothing) said about Europe and other markets or about start-up companies. Toward end of meeting I asked about startup companies. Did not get any kind of answer that would shed light on what is going on with startup companies, plans for CW, etc.. Direction for 2004 and 2005 seems to be to US with focus on carriers (all carriers including cable companies). NL said the company has following 3 core initiatives: 1. Commitment to channel sales approach 2. Product branding (as MRV) 3. Federal government sales While initiatives take time he mentioned that in just a year (2002 to 2003) they’ve managed to increase government segment sales from $700K in 2002 to $3M in 2003. In reviewing company NL mentioned that MRV closed operation in Japan. I questioned/asked about it and was told it was done to reduce expenses and only because local channel partners established and running with the ball. Todd Rope mentioned website and how it now includes alot of information available by ID/password to channel partners. Also mentioned website is a major sales tool with the main website (www.mrv.com) now leading you to new prouct/market segment sites like www.mrv.com/plugins and www.mrv.com/wdm. Supposedly more of this coming. MRVC had a sampling of products (both Luminent and MRVC) available. The new cross connect products seem to have alot of potential in many different, some non traditional for MRV applications, markets. Expressed my frustration at MRVC’s appartent unwillingness to do more to promote sppecific applications for existing products (maybe someone would see the article/advertisement and thing they might have a similiar need) and to actively promote their new products (like the crossconnect products) for all the ways the product apparently can be used. Hope they heard me. Happy to try to answer any questions. Will reread my notes to see if I missed anything