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Non-Tech : Radica Games (RADA) -- Ignore unavailable to you. Want to Upgrade?

To: David who wrote (6002)	9/9/1998 7:54:00 AM
From: swedelo	Read Replies (2) \| Respond to of 7111

David, Congratulations on a fine job with your end of the conference call yesterday. It was quite obvious you were well prepared and truly knew your stuff. I would like to share some of what I got out of yesterdays statements and Q&A: 1) Even though I don't believe the gentleman ever quite got the grasp of "average wieghted number of shares", I finally got the answer I wanted; that, being that you have completed buying ALL 2 million shares announced, and MAY persue more ( I consider this likely given the cash position of the company). 2) As a result of buy back outstanding shares now = 19.6 million shares and float = 9.5-10 million shares. Using these updated figures gives a trailing 12 months earnings/share of approx $2.37/share instead of the stated $2.23/share on an avg. wieghted basis. 3) Mr. Davids (3.2 million) and Mr. Pickup (Devcar @ 5.2 million), according to my records now hold approx 8.4million shares, other insiders hold approx 1.4-1.9 million shares to leave a balance of 9.5-10 million shares in public float. 8.4/19.6=42.9% of total outstanding by Davids and Pickup. Also, 8.4+1.4= 9.8 = 50% of total outstanding shares in the hands of insiders. If company continues buyback, and especially if Pickup (Devcar) continues to add to position as they did this month, very soon Davids & Pickup will own in excess of 50% of the company. This means that in the not to distant future Mr. Davids and Mr. Pickup (Devcar) will hold a controling interest in the company making any company ballots a moot point as long as these two agree. 4) It has been apparent to me for some time that Radica has had no interest in promoting its stock in any way. This was only backed up by the statement from (I believe Mr. Davids, or was it Mr. Bengston?) to the individual investor who called and relayed that his large position had taken a beating and, what was Radica, If anything, intending to do to help promote (read raise) its stock price. The answer this investor got was a cold," we don't pay any attention to what the market does, we just try and concentrate on managing the company and doing the best that we can" (paraphrase). 5) probably the best question of the day....Have you considered taking the company private? Response, short and curt answer of, "It has been discussed". Think about it! 6) I wish Mr. Davids would have showed 1/3 the enthusiasum for Radica that he obviously expressed in his explainations of U-tel and what that company was all about. (or was it Mr. Bengston) 7) Radica is well positioned not only for up coming 4th quarter, but for next 2 years to come. I particularly like the fact that stealth assault will be in short supply for Christmas much like Bass Fishing was last year. This will lead to excellent carryover into next year as Bass Fishing did this year. Also, Girltech (I suggest all investors go to web page girltech.com and check it out, I think you will be impressed with the marketing concept) I feel will prove to be an excellent acquisition. This combined with increased OMD work of small soldiers and starwars and a promise of 25 new toys in the next year bodes well for the long term prospects of this "one trick pony." 8) Earnings: announced earnings of .52/fully diluted share (read .57/share@ current 19.6 million shares) was not far off what I projected of .70/share,and would have actually exceeded this figure if not due to an increase of 3.79 million dollars (or 78.7%) in total operating expenses, over Q2 due to accrueal of advertising expenses. In fact, their gross profit of 19.48 million actually exceeded my expectations by about a million dollars and was up 7.81 million (67%) from Q2's 11.67 million. Hardly "flat".(See Waynes projections for Q4 as I come up with almost exactly the same figures) IN SUMMARY: I feel management has done an outstanding job of both managing and marketing our product line. I feel their visions; and, positions they have taken for the distant future, will prove very successful and will soon move us from the "one trick pony toy company" list.To those whom I suggested to buy this stock in the $16-$20 range (and still have the ears of) I am suggesting to buy as much more at todays prices as they feel comfortable with(as a broker once told me...If ya liked it at $20, you oughta love it at $13). I don't know what direction this company is headed as far as if it will go private, stay public with small float and controling insiders or be acquired. I do see;however, that as long as the short market makers are able to supress the market price, it behooves both the company and all LONG investors of Radica to continue to buy back shares with the glut of incoming capital and NOT try to influence the market price upwards. This will ultimately pay huge dividends to any who hold this investment long term. I do feel that management has a long way to go in the field of investor relations. Shoot, even Bill Clinton "feels our pain." During the conference call I continueously got the impression that we as part owners of this company were somehow being a bother , and should just leave them alone and trust them to run the company as they know is best. C'mon guys. a press release now and then on an up-to-date and updated webpage wouldn't hurt anyone, now would it? Continue the good work that you've done, and please, keep in touch more than once every quarter at conference call time. We are interested in whats going on. Best Wishes, Swedelo