To: Todd Suckling who wrote (2209 ) 5/21/1998 2:12:00 PM From: uu Read Replies (3) | Respond to
*** Response from the Network with regard to the Financial results ***1. From the earnings report: "The company apologizes for the delay in the availability of the year end results. " 2. LOSSES:a) $666,000 for legal costs! Airstar must have some really expensive lawyers! Just exactly what legal issues Airstar has been involved that has cost the company $666,000? And please pay attention to the number 666 in this figure!b) $144,000 loss on the sale of a subsidiary! Exactly what subsidiary of Airstar the report is refering to? The inquiry mind would love to know about it!c) $5,242,000 million in depreciation and interest expenses. ( approximately $2,410,000 in depreciation and $2,832,000 in interest expense). WOW! That is a heck of depreciation for a company that had an annual revenue of about $7 million!! And here I am thinking Airstar (according to their 5 minute web site) was using the state-of-the-art equipment and facilities, etc.! Things sure depreciate a lot when they are state-of-the-art!!d) Then there is an additional net loss of $1,858,752 which was (in the words of company's earnings report) "predominantly" the result of depreciation and amortization expense of $719,397 and interest expense of $889,894 for a total of $1,609,291. These expenses directly relate to the telecommunication systems and equipment and related debt as they relate to the AAFES project. b) above?! Or perhaps they are both part of the same figure? In short (as stated earlier) the net loss increased by about 50% over the previous year. 2. Ok, so much for the losses. Now lets examine the revenue and profits.a) Compare to 1996 revenues for the year ended Dec. 31, 1997, increased by 54% to $2,514,120 totalling $7,146,438 Vs. $4,632,318 in 1996. 54% increase in revenue is indeed impressive. However considering that losses were also up by 50% it kind of offsets the impact of revenue increase!! Sort of like I get a 50% raise in my salary but at the same time I also increase my spending by 50%. c) Gross profit increased $1,520,651 or 214% for the twelve months ending Dec. 31, 1997 over the same period of 1996. The gross profit as a percentage of sales was 31% in 1997 versus 15% in 1996. This is somewhat impressive. However this will mean absolutely nothing unless the expenses and losses are cut by 50-100%!d) At Dec. 31, 1997, the company had a working capital deficit of $3,175,076. At March 31, 1998, the company's working capital increased to a positive $5,339,237, of which approximately $3,000,000 is being utilized for expansion. This is good news. Why? It guarantees company will not go out of business for at least one more year (thus keeping this thread alive with more SEE-BS sit com episodes to watch)!Message 4326240
