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CollabRx, Inc. Message Board

  • swampthing swampthing May 16, 2001 11:50 AM Flag

    TGAL take over target!

    Is TGAL a good takeover target? With the patents etc. and the condition of the industry I would expect to see some consolidation.
    ANy thoughts?
    ST

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    • forget about it! it is just wishfull thinking. if the company can't get it operating costs under control i would expect that no buyer would appear.

      • 1 Reply to feridg
      • I agree. I just finished the breakeven analysis. There are some strange things that have occurred in the last two quarters. Amazingly their expenses are very predictible and the gross profit margin was consistently at the 43% the first two quarters. The last two were way off! Third quarter was 34.4% and the fourth quarter was only 20.6%! There was also a year end adjustment reducing sales by 458,000 that was not the cummulative adjustment. If you add up the sales by quarter as reported, you do not get the 38.2 million for the year.

        I also did the crunch on the last quarter's sales and if it is true that the gross margin would have been at 43% without the strategic sales for the year, I backed into the sales for the year at 42.6 million based upon the cost of sales of 24.3 million. What this means is that they gave away 4.4 million of sales for free! I'll do the math again for everyone. 42.6 in sales, times 57% cost of sales (leaving the 43% margin) you get the 24.3 million in cost of sales they reported. What thats saying is that sales in the last quarter was reduced by 4.4 million to this customer to get the customer to take the unit(s) to try out in a new market. They gave them away! Somthing isn't right! There was a huge discount to sales in the fourth quarter. You can do the math easy. Sales of 6,235,000, COS of 4,952,000, gross profit of 1,283,000. 1,283,000 divided by the 6,235,000 is a gross profit margin of only 20.6%! Nothing close to the 43% they did in the first two quarters. Someone sold units at a huge discount! Like for free!

        Everyone missed the gross margin drop in the third quarter because we were all jumpin up and down over the 8 million royalties, but the gross margin was only 34.3%. Something strange was going on in the last two quarters. Someone should have asked these questions at the conference call, but when you get the numbers 15 minutes before the conference, who knew! Someone needs to do some explaining on this and the royalties! To many big questions now besides the patents. The company said they did not have a cancelled sale, but I'm wondering if they had units returned? We are missing about 4 million. Do you have it? I don't, that's for sure!

    • First question to ask is if they have adopted a shareholder's rights plan to prevent one and I think the answer is no. Is someone aware of anything that would discourage one? I think your thoughts make sense, in fact I was just checking out some of the Yahoo comparables to Tegal and one of them just adopted a preferred stock shareholders rights plan to prevent one. So, without one, its a possibility in this environment, but not a certain one unless there is more signs that point to it.

      Still waiting on the 5% SEC rule. So far, no disclosures. Anyone over 5% must disclose in 10 days, and no one has so far. That 185,000 share block went out last Friday. If there was going to be one, it could happen 10 days {not sure if that's business days?} after that. That trade could have been between M&M's. We need more proof. The accumulation is old news now. Its been going on since January. Need something else to be more convincing. SEC disclosure would be nice!

 
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