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Message: RE: Very quiet, no news in quite awhile. Crazyman

RE: Very quiet, no news in quite awhile. Crazyman

posted on Apr 24, 2005 09:26AM
You haven`t been listening to me! LOL And maybe nobody else has either, cuz I get very little response when I bring it up (2-3 times now). Maybe people think discussion could jinx the whole idea.

``Another 10 airlines and fleetwide orders from existing customers is bound to push our revenues into positive territory.``

While take would certainly do it, but IMO there is a distinct possibility that we hit break-even/small profit last Q. Just look at what we KNOW:

At YE report, EDIG had in hand some $1M as a 50% up front payment for the purchase of digEs. That means a ~$2M order. If EDIG only makes a 20% profit margin (their old ``benchmark``, which I actually believe they are exceeding with the digE), that`s $400K.

EDIG got a $200K settlement with F-10, but supposedly spent near $100K of legal counsel, leaving a little over $100k net ``profit``.

That brings us to $500K (in previous posts on this, I used a more realistic/optimistic 25% margin on digEs, which would bring us to $600 at this point).

Now we hear of all the bells and whistles coming with the digEsystem. This makes me feel better about the prospects for significant NRE income. Three months of 5-15 dedicated EDIG engineers. What would that cost? But this is the wild card in this discussion, because this effort could have been handled - finacially -in many different ways. They range from Wencor paying cost plus a major premium for the effort, to EDIG doing it gratis recognizing the future rewards to be reeped from this current effort.

Bottom line is that IF Wencor paid for this EDIG engineering effort, and paid as much as $300K, we could have broken even/made a small profit for the qtr. (assuming a burn rate of $750-800K for the qtr.

Other wild cards exist as well. NRE for other products, more digE sales initiated/delivered during the qtr., other things about which we are clueless - any/all would fuel this fire.

Whatcha think?

And I KNOW nuttin`! (I sure like my disclaimer!)

SGE

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