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Non-Tech : E4L, Inc. (NYSE: ETV) -- Ignore unavailable to you. Want to Upgrade?

To: BARRY ALLEN who wrote (342)	1/29/1998 3:59:00 PM
From: John Arnopp	Read Replies (1) \| Respond to of 1080

Barry & Bill: here's the relevant paragraph from the filing regarding Asian sales: Dependence on Foreign Sales The Company had no sales outside the United States and Canada prior to June 1991. The Company now markets products to consumers in over 70 countries. In fiscal 1997, 1996 and 1995, approximately 47.4%, 51.6% and 45.7%, respectively, of the Company's net revenues were derived from sales to customers outside the United States and Canada. Such sales represented a 12.4% increase in fiscal 1997 from fiscal 1996, a 87.6% increase in fiscal 1996 from fiscal 1995 and a 74.8% increase in fiscal 1995 from fiscal 1994. In fiscal 1997, 1996 and 1995, sales in Germany accounted for approximately 5.7%, 7.0% and 13.0%, respectively, of the Company's net revenues. In early 1994, the Company began airing its infomercials in Asia. Sales of the Company's products in Asia accounted for approximately 19.8% of the Company's net revenues for fiscal 1997. Sales of the Company's products in Japan, which represented a significant portion of Asian revenues, accounted for approximately 17.7% of the Company's net revenues for fiscal 1997. The Company experienced a decline of approximately 30.3% in its Japanese net revenues in fiscal 1997 compared to fiscal 1996. During fiscal 1998 this trend has continued. In the first six months of fiscal 1998, as compared to the first six months of fiscal 1997, the Company's revenues in its Asian marketplace had declined by 42.2%, 4.8% of which is attributable to currency devaluation. The Company expects such revenues to continue to decline in light of the economic downturn, including a significant devaluation in currencies, and increased competition experienced in certain Asian countries in the fourth calendar quarter of 1997 and in the beginning of the first calendar quarter of 1998. Geographical expansion of sales activity results in increased working capital requirements as a result of additional lead time for delivery of and payment for product prior to receipt of sale proceeds. While the Company's foreign operations have the advantage of airing infomercials that have already proven successful in the United States market, as well as successful infomercials produced by other international companies with limited media access and distribution capabilities, there can be no assurance that the Company's foreign operations will continue to generate increases in net revenues. Competition in the Company's international marketplace is increasing rapidly. In addition, the Company is subject to many risks associated with doing business abroad, including: adverse fluctuations in currency exchange rates; transportation delays and interruptions; political and economic disruptions; the imposition of tariffs and import and export controls; and increased customs or local regulations. The occurrence of any one or more of the foregoing could have a material adverse effect on the Company's results of operations. Most of the Asian sales were in Japan, and have been declining. While NM's COGS for its products made in Asia could go down, increasing profits, that would depend on their ability to renegotiate existing contracts and enter into new contracts for new products. What is the average product life-cycle (no pun intended) for NM's products? --John

To: BARRY ALLEN who wrote (342)	1/30/1998 9:33:00 AM
From: Willsgarden	Respond to of 1080

Barry, where they do the manufacturing is only an educated guess, however, it certainly would be an offset to slower japanese sales by improving their margins. I was told (second hand info), that the current quarter is expected to be a profitable one. I have no clue as to revenue and margins generated by the current products. Besides the product launches, they obviously provide production services for Paxson and perhaps others in the tv and media business. The stock has to be worth more than it is now.... Bill