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Technology Stocks : Deswell Industries (DSWL) -- Ignore unavailable to you. Want to Upgrade?

To: j rector who wrote (1290)	6/2/1999 1:22:00 PM
From: Ron Bower	Read Replies (2) \| Respond to of 1418

j, I don't think there's a problem with Jetcrown. Some lower margins, but this was to be expected and should be offset with increased sales. They report that Mita and VTech sales are increasing and we know Namtai is increasing sales. I look for Jetcrown to have a good year starting next Q (1st Q of the new year). Kwanasia barely broke even last Q and this Q showed a $660K loss. Lower Kwanasia sales has some effect on Jetcrown as Jetcrown supplies them with plastics. I would say Kwanasia's problem is the reliance on Behringer and InterTel. If you look at the percentage of total Deswell sales to them and the portion that's Kwanasia's, there's very little revenue coming in from other sources. Paul K. needs to post on the competition for circuit board business and Kwanasia's position in the sector, but I don't think they are in a very good position going forward and am concerned about the effect on Deswell's overall operation. They'll continue to profit because of Jetcrown, but Kwanasia must bring forth profits instead of losses for Deswell to show good numbers. Note - this was an unaudited report. JMHO, Ron