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Technology Stocks : Alliance Semiconductor -- Ignore unavailable to you. Want to Upgrade?

To: Ken Muller who wrote (2311)	1/14/1998 7:00:00 PM
From: MoonBrother	Read Replies (2) \| Respond to of 9582

Ken, you wrote <1. Cash is now down to $14 million. That's enough for 1 quarter. They will either have to sell fab stock or start borrowing funds this quarter. 2. The cost of manufacturing has risen above sales revenue. What this means to those who don't follow the accounting, is that ALSC is losing money with every device they make, exclusive of the company overhead costs.> Looks like you are the person who "don't follow the accounting". 1. The reason Alliance's cash is down to $14mil is because they have contributed another $17mil in the qtr to USC. Adding that money back, ALSC would have $31mil in the bank. 2. the cost of manufacturing includes a $6mil inventory charge. Without the charge the cost would be significantly lower. In fact, this qtr's balance sheet has demonstrated that the profit margin for the products sold in the qtr has risen considerably, which echoes the fact that we know that Alliance makes decent profit on 256x16 chips (now selling at $2.50 each). I thought you know better than what you've written here. You are either deliberately misleading others or have temporarily lost your IQ. But no matter what the case is, please do your own a favor as to buy some shares tomorrow, or else your would miss the chance to get any ALSC at $6 range. Good luck! MB BTW, I've tried to call Janine Zanile (IR at Alliance) this afternoon, and didn't get through. I'll try tomorrow again, and let you know what I got.

To: Ken Muller who wrote (2311)	1/14/1998 7:14:00 PM
From: patrick tang	Respond to of 9582

Ken, yours and mine analysis so far - 1. You are right that ALSC is burning cash. tht inventory write down has to be paid for. My original assumption was that ALSC has been carrying excessive inventory for so long that the write down would occur on really old paid for inventory. That is not the case. It seems like they burned about $20M over the last two Q. 2. They did not burn the $15M/Q you quoted, I believe, was due to the fact the extra fab investment last summer was for $24M and not $14M. I was really surprised by this, but comparing Jun30 and Dec 31 figures, the investment went from $54.75M to $78.87M. Wish they would put the Sept financials on the web. 3. I believe that they included the $6M write-down in the cost of manufacturing, since I do not see any extra $6M item anywhere. Strange place to put it, but ...... As such, if their cost is $26M - $6M write down, the cost seems to be down, probably because they are making the DRAMs in 0.3 um. I expect this to improve this Q as well as the process mature further. 4. They seems to be in line for 0.25um. Although I would have like to have seen it a couple of months earlier, I think they are fine in this regards. 5. The $14M in cash is low if the burn rate is $10M/Q. But if 16M price holds at the low $3.00 for this Q, they should do OK. Probably won't burn an cash this Q. If it goes to $2.00 again, heaven helps everybody, not just ALSC. 6. I am starting to think that the DRAM current price up is for real and is due to the memory price being so low that everybody is shipping with 32M and 64M/system. Even entry $800 computers have 32M now. If so, this would be really good new. Time will tell. 7. Somebody mentioned income tax refund, can the person pls elaborate on amount due and time frame expected in. patrick tang