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Technology Stocks : Cognicase (COGI, T.COG) - Integrated IT Solutions -- Ignore unavailable to you. Want to Upgrade?

To: gerald tseng who wrote (91)	3/10/1998 11:16:00 AM
From: Josef Svejk	Read Replies (2) \| Respond to of 843

Humbly report, Gerald, just got off the phone, yes BM, my prior attempt must have been too early. To add to what Gerald said: Acquisitons will strenghten COGIF marketing, lead to larger contracts, and EPS growth. No new share issuance in regards to Systemhouse deal. Hexagon vaults Cognicase into new geographical locations and markets. With the consolidation of Cognicase and Systemhouse factories, Cognicase gains 54 new staff familiar with the Cognicase toolset, for a total of 110 in factory staff, which will allow COGIF to handle more and bigger contracts. Usage of factory is approximately 80%, plenty of capacity left, even when 50 million LOC orders come in. Price is C$.45 - C$.50 per LOC, double with testing. Price per LOC may rise, since customers seem to accept the COGIF contract price offered. Customers are signing faster, the process of new contracts is accelerating. Adding staff continually, COGIF has good reputation, 100-200 more planned additions. Regarding further acquisitions, an example of a company Cognicase may be looking at would be a testing tool company, to round out COGIF offerings. Government contract should be announced soon. The call was very hard to hear, due to the nature of recorded phone conversations, and also due to the accents of COGIF participants. If anyone finds the transcript on the net, please post the URL. All in all, my impressions are very positive. This company is on a roll, with a clear strategy for now and for the future, ready to capitalize on it's growing strengths in an environment of increasing y2k urgency. Svejk (GL-15 applies: digiserve.com ;-)

To: gerald tseng who wrote (91)	3/10/1998 11:59:00 PM
From: Sally Gallagher	Read Replies (2) \| Respond to of 843

All: I'm new to the thread and have a couple of questions regarding COGIF's margins and roe. From what I can find, these seem to decline pretty significantly from 1995 to the last 12 month period. Margins were 24% in 1995, 11 % today? ROE 53.8% in 1995, 27.8 % 1996, 4.4% prior 12 months. These are from searching WSRN's web site. Given the above, COGIF looks pretty pricey (esp. given the high PE). What am I missing? Nice write up in IBD in February that called COGIF to my attention. Trading then at 19, faded to 17 and now 20-21. Thanks in advance for the help. Gerald, esp. for the nice write up of the CC. Sally

To: gerald tseng who wrote (91)	3/11/1998 12:16:00 AM
From: BM	Respond to of 843

Gerald, some add-ons to your notes. >> 3. Hexagon acq.: the company is running profit margin of 3.5% before acquisition (net margin after expenses and tax), COGIF intends to improve the margin to 7% within 2 qtrs. The reason given for the low margins is a function of the nature of the current company (i.e. a private company) and management's way of rewarding itself. Under Cognicase and a different rewards structure which does more to enhance shareholder value, the margins should improve. So 7% is viewed as very achieveable. >> 5. Question asked if Co. seeing some cross-selling due to the acquisitions, they answered YES, but they did not seemed to have anything material to specifically talk about. I heard the CEO mention that several Icotech clients had now become Cognicase clients as well. >> 6. Somewhere during the CC, I THINK I HEARD ceo said they are planning to announce contract with Canadian goverment today He said (yesterday) that the government was scheduled to announce contracts, which it did today. As per my post of the release, Cognicase isn't mentioned directly but will gain substantially due to three partners being among the seven who were awarded today. >> 7. Another part I didn't get it quite clear. Question re: LOC charge is 40c-50c/LOC w/o testing, $1.20/LOC w/testing. That's correct. But even more significant to me was the mention of the LOC charges in the US - I'm pretty sure I heard them say 50-60 per LOC in the US where demand is even higher. As a Canadian, I simply love a company whose revenues are in U.S. greenbacks while its SG&A is in Canadian loonies !!! >> anyone more familiar with COGIF, please listen to the replay. I might have missed important points from the CC due to the fact that I just started study this stock, some important dialog might not transpire into any significance in my ear. You did exceedingly well for being new to the company Gerald. Thanks for sharing your notes.