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To: NasdagStocks who wrote (308)	7/27/1998 1:39:00 PM
From: MC Niemi	Read Replies (1) \| Respond to of 329

Glenn: Just read through your 2nd Q press release. Have a couple of questions that you can clear up. 1) 1st Q sales were at $5,954,000. 2nd Q sales were at $5,985,000. Not much growth. How come? In your annual report it says that "The current demand for our capacitor films is in excess of our production output.". That would seem to imply a growing sequential sales increase. Are you running at 100% capacity? I was told that DNA was at 70% capacity and growing 15% yearly. Are you having problems getting equipment to meet demand? Is one product line increasing while another decreasing causing a net minor sales increase? Is volume up but prices down? 2) What is backlog? 3) It was nice to see a profitable June. Will this continue? Are there more cost reductions to come? What is target rate for operating income %? Last year you were running around 9% in 1st 2 quarters. 4) Are you going to meet your goal of doing $25 to $30 million of sales in 1998? 5) What is latest EPS forecast. The last I heard was .30. This does not look viable to me since you are already .05 in the hole for 98. This would imply .35 in earnings in the last 2 months. Or is this the reason you are buying shares in the open market because you think you can make .35 every 2 quarters going forward? If so then we are looking at .60 to .70 in earnings for 1999? 6) What are you going to do about the debt? Pay it down with cash flow over the next 2 or 3 years? Or are you going to use cash flow to reinvest in the business and make other acquisitions? 7) Could you break down 2nd Q sales by product line? ] MC