Spotlight ASTT ($2.53) Stock to Watch This Week.... MONDAY 12/4/2004 INTC LAST 27.60, AMD LAST 17.36, TXN LAST 29.47, Vitesse, and other large semiconductor companies will report earnings this week. The guidance these companies give could lift ASTT to the $3 to $4 range in a hurry. ASTT is a provider of semiconductor assembly, test, and package design services Headquartered in Hong Kong, with offices in the US, and factories in Hong Kong and China. ASTT is listed in the new USX China Stock Index. ASTT announced today that it has been approved for listing on the Nasdaq National Market: http://biz.yahoo.com/prnews/040412/sfm009_1.html MORE ON ASTT: ASTTs customers include: Analog Devices, Agilent Technologies, Altera, Atheros, Broadcom, Infineon, Pkilips, Samsung, SigmaTel, Vitesse, and others. SigmaTel recently recognized ASTT as its "2003 Assembly and Test Supplier of the Year Award." JP Morgan has accumulated over 42 million shares of ASTT in the last six months and now onws 33% of the company....It's largest Shareholder. http://finance.yahoo.com/q/mh?s=ASTT Last month, ASTT reported its best quarter in over two years after steady improvements in the prior 3 quarters. Highlights: ASTT reported net revenue for fiscal 3Q 2004 of $59.6 M, an increase of 24% compared with $48.1 M in 2Q2004, and an increase of 50% compared with $39.7 M in the same period a year ago. This was the 4th consecutive double-digit revenue growth. ASTT posted net income of $1 million on 3Q 2004 before an impairment charge of $2.4 M. EBITDA increased from $6.7 M in 2Q2004 to $10.6 M in 4Q 2004. Excluding the start-up costs incurred for ASTT's new China factory, EBITDA in the third quarter was $12.3 million. Cash at the end of the third quarter was $59.5 million, which includes $35.2 M in additional cash resulting from the successful $150 M bond offering accomplished during the quarter. Cash generated from operations in the third quarter was approximately $10.6 M. ASTT retired its $100 million 12.5 % interest rate long-term debt with the bulk of the financing proceeds. Gross margin for 3Q2004 increased from the mid teens in the prior two quarters to 20.8%. Gross margins are expected to improve further by shifting production to the new 225,000 sq ft China factory during the current quarter. This plant is located about 60 miles away from the company's Hong Kong headquarters and manufacturing complex. The China plant will greatly improve productivity and efficiency because of lower labor costs as well as state-of-the-art technology/systems including SAP and Camstar. In the 3Q 2004 earnings press release, Mr. Harry R. Rozakis, CEO of ASTT stated: "..Production in China is scheduled to begin in the fourth quarter of fiscal 2004, and we expect phase one of our new facility to be in full production by the end of this calendar year," Mr. Rozakis added. "Construction on phase two is expected to start in the second quarter of this calendar year and is scheduled to be completed in the middle of calendar 2005. When finished, the 450,000 square foot facility will be one of the largest subcontract assembly facilities in China." "Based on improved customer forecasts and increased market penetration, we expect to achieve continued revenue growth and profitability in 2Q2004.."