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Technology Stocks : TLAB info? -- Ignore unavailable to you. Want to Upgrade?

To: jhild who wrote (1945)	1/26/1998 7:04:00 PM
From: Robert DeHaven	Respond to of 7342

Support was 45...it bounced but the trend is down...sorry guys it doesn't look good. (eom)

To: jhild who wrote (1945)	1/27/1998 1:50:00 AM
From: Chuzzlewit	Read Replies (1) \| Respond to of 7342

While operating expenses went from $82MM to $117.5MM (roughly a 43% increase) the major component was R&D which increased by 45%, while marketing and G&A increased by 42%. Considering that TLAB opened several new plants this year, and the probability is that these plants are not yet operating at near capacity, I wouldn't be too concerned because G&A expenses generally follow a stair-step pattern and should remain relatively fixed for the time being. Receivables are not worrisome to me, because an increase (41% from last quarter) may reflect an acceleration of business towards the end of the quarter. It would only raise a red flag if there were some question of their customers' ability to pay. Also note that if you add back non-cash charges to operating income we have a 30% increase on a 29.8% increase in sales. So, if my analysis is correct, G&A expenses should increase much slower than sales until TLAB once again requires additional plant capacity providing greater net margins in the future. All in all, this looks like a very solid earnings report to me. Regards, Paul