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Biotech / Medical : ACMI - Accumed Inc. -- Ignore unavailable to you. Want to Upgrade?

To: george who wrote (399)	10/30/1997 5:59:00 PM
From: aatkinson	Read Replies (1) \| Respond to of 1894

Obviously not good news. Although revenuse are up significantly, the gross margin has slipped from 56% down to 32% - quite a drop. They doubled their discretionary R&D budget so they're not as worried as you and me about near-term earnings. They had a significant increase in interest payment due to the additional debt and over all they have missed the street-expected loss of $.06 by a negative 133% - not good. They hype the operating margin change but say nothing about the significant negative direction in the gross margin. Since the company is unusually tight lipped, we wont get all the gory details until the 10Q comes out later in November. It is extremely difficult to project any earnings, let alone positive earnings, when the margins keep changing, the level of R&D expenditure moves wildly and the amount spent on "selling" decreases with increasing revenues. Still, have to wait for the 10 Q to get additional detail. In the meantime, barring uncommon additional information from the company, I would expect the price to fall

To: george who wrote (399)	10/30/1997 7:54:00 PM
From: Frank Buck	Read Replies (1) \| Respond to of 1894

Earlier in the third quarter, (8/19/97) AccuMed Chief Operating Officer and Chief Financial Officer Leonard Prange said he was comfortable with a full-year 1997 revenue projection of $20 million to $25 million. He said the company should reach about break-even in the fourth quarter. Providing the uncommitted third quarter "contract negotiations" are "pushed" into the fourth quarter, the $20 M to $25 M revenue projection seems realistically attainable. Nine months of sales for 1997 = $ 14,157,306 and they are making an effort to keep costs down. The number that the street was looking for is {.06} and if you recall that was revised down from {.04}. We all know what has happened to companies for missing estimates by a few cents. The question that puzzles me is, if management knew that the numbers were going to be off that much why weren't they in talks with the analysts sooner? I am not sure what effect these numbers will have on the stock price, especially on Halloween. This is two quarters in a row that estimates have been blown by 100% or there-about. I am and have been in for the long haul. I would reccomend the same. Be prepared for some encouraging press releases to soften the latest earnings. I am sure that the earnings release statement timing has been orchestrated to coincide with more up-beat news to follow. Hopefully all the bad news is behind and all the good news ahead. After all the third quarter is already a month gone. That is a backward looking indicator. Remember, "...we continue to be optimistic for the future." We shareholders can only hope that they mean that in the truest sense of the phrase.