Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Escala Group, Inc -- Ignore unavailable to you. Want to Upgrade?

To: Robert T. Quasius who wrote (152)	5/24/2006 7:52:47 PM
From: Glenn Petersen	Read Replies (1) \| Respond to of 160

ESCL is dead money until the uncertainties are sorted out. I won't be buying the stock, though I'll probably keep an eye on it. Escala says can operate without Afinsa revenue Tue May 23, 2006 11:17 AM ET NEW YORK, May 23 (Reuters) - Escala Group Inc. (ESCL.O: Quote, Profile, Research), a collectibles company whose stock has plunged because of an investigation in Spain of its largest shareholder, said on Tuesday it can operate without sales to that company. Shares of Escala, which operates in auctions, stamps and precious metals, gained more than 8 percent in morning trade on Nasdaq. Prosecutors have said Afinsa sold its investors stamps that were marked up as much as 1,150 percent in a pyramid-type scheme from 1998 to 2002. Herrero reiterated that no charges or allegations of impropriety have been filed in Spain against Escala or any of its subsidiaries. He said that two Afinsa representatives on Escala's board have resigned, and a non-Afinsa Spanish member of its audit committee and board also stepped down. Herrero, who highlighted the most successful auction in five years last week by a German unit, said Escala was unable to speculate about future revenue streams from Afinsa. But he pointed to the company's 18 units that operate across the globe, and said Escala will continue to diversify its base. "Very simply put, we do not know what that will be," he said about future Afinsa revenue. "The question on everybody's minds is very straightforward. If Afinsa's revenue is gone, what are you going to do?" Although Afinsa accounted for a sliver of third-quarter revenue, backing out the Spanish company's contribution to Escala's $16.6 million in operating income would result in a loss of $1.7 million in quarterly operating income, he said. Escala has said that its businesses other than stamps were continuing to operate. Herrero also said that if sales to Afinsa come to an end, Escala plans to take steps to reduce costs related to the Spanish company. Escala's stock plunged two weeks ago after police in Spain arrested nine people in an anti-fraud swoop on Afinsa and another company. Escala has said it would defend itself against a number of lawsuits that allege violation of securities laws. Escala shares rose 68 cents to $8.55 on Nasdaq. The shares had fallen to as low as $3.95 on May 12 in the wake of the news on Afinsa. © Reuters 2006. All Rights Reserved. us.rd.yahoo.com*http://yahoo.reuters.com/financeQuoteCompanyNewsArticle.jhtml?duid=mtfh05601_2006-05-23_15-17-28_n234245_newsml