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Technology Stocks : Adaptec (ADPT) -- Ignore unavailable to you. Want to Upgrade?

To: Starowl who wrote (3180)	7/25/1998 10:30:00 AM
From: Jim Switz	Read Replies (2) \| Respond to of 5944

Starowl: Actually, I like the annual reports. There is a trend away from the vacuous glossies typical of that genre of literature. But Adaptec puts effort into making the reports interesting and informative--and readable--telling me something about how it approaches its business. I agree. The annual, for several years now, has been something to be anticipated as much for its design as its content. "How will they top last year's book?" I believe that a decision was made to make it a "keeper", not a typical annual to be filed or tossed soon after receipt. Why? I think it's simple; ADPT has for years had a very hard time getting analysts and investors to understand how to categorize and value the company. We're still very likely to be lumped in with disk-drive and semiconductor companies as a group, which isn't reflective of ADPT's business except in the grossest terms. So they've been trying to get people to really pay attention and see what the company does. I think the reports have been relatively successful in this mission, but we still have a long way to go. Intel was a relative unknown in the general public's mind until it started the brilliant "Intel Inside" campaign to fend off the growing AMD and Cyrix threats. I'm not saying a similar thing is appropriate for ADPT, but a "grabber" annual is a decent investment, IMHO. As for the expense to produce it, I'd guess maybe $1 million at the very most, including printing/mailing costs and staff time. They've had somewhere around 1,500 - 2,000 shareholders in the recent past (yep, not many, but we used to have 85%+ institutional holding), and I would imagine they print 10,000-15,000 copies of the annual to have extras for conferences, investor requests etc. A million dollars is a lot of money, but it's roughly 20 ad pages in a major computer magazine. Considering it as an annual advertising/marketing expense, the money is probably pretty well spent. Let's say they really cheaped out on it, and made it a conventional grey book of text and numbers, with the usual boilerplate, on decent paper stock. How much money would be saved overall? Probably not much. But, I think they did attempt cost savings in the annual this year. The design and layout costs were probably comparable to previous years, but I'll bet the printing/distribution costs are significantly lower. No glossy stock, no bound-in photographic prints etc. As for how well it was designed and executed this year, I'm still mixed, but I don't dislike it - just have to live with it a while longer. I'll also check with my sister; she has designed annual reports for a living for several years, and has been generally positive on their past efforts.

To: Starowl who wrote (3180)	7/25/1998 11:38:00 PM
From: Investor2	Read Replies (1) \| Respond to of 5944

I liked the annual report, too. Re: "One of the first things folks look at for cutting costs in a sick organization is the unit or activity that isn't materially or visibly adding to revenue. I would take the abandonment of Adaptec's unique annual report as a bad sign." I like companies that save money where possible in annual and quarterly reporting. I would think that the ADPT annual report was less costly than the traditional book-like, glossy-paged, annual report filled with photos. Best wishes, I2