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To: feltburner who wrote (3249)	11/14/1997 3:45:00 PM
From: Jeffrey S. Mitchell	Respond to of 10786

Looks like operating expenses were flattish (perhaps slightly down) vs. previous qtr. despite the opening of several sales offices. This should alleviate concerns on the expenses side. You know, I bet people were just starting to buy into Tech's theory-- and you had to go spoil it by pointing out real numbers. First of all, for the first six months of '97, ALYD had $6.4M in related payroll (i.e. compensation etc), which is $1.067M per month. Tech's figure of $1.5M per month is a whopping 41% higher than the actual figure! But it gets more ridiculous... Let's count the posts over the last three months where Tech begs and pleads with all of us that ALYD is running itself into the ground by hiring all these new programmers, salespeople, etc. Not to mention the opening of new sales offices, a big advertising campaign and the addition of equipment. Yet, despite all this spending, expenses went down. Lastly, yeah I was hoping to see better numbers at this point-- but, when all is said and done, ALYD will have gone from 0 to $12.5M in revenues in one year, with a last quarter eps of .09 to .21. And the real fun doesn't begin until '98. - Jeff

To: feltburner who wrote (3249)	11/14/1997 5:34:00 PM
From: P. Ramamoorthy	Respond to of 10786

Felt Burner - It's not clear how much of $5.45Million (cash and receivables) are receivables. If a major part of $5.45Million booked for the 3Q is receivables, their projection of $6-8 for the next qtr seems to be consistent. Total liabiliites at $1.55 Million averages out to $500,000 per month. If they can maintain the liabilities at this level, margins should expand and the 4Q has to be profitable at $6Million revenues. (guessing at least 9cent/share, (6-4.43)/17= .09) Ram