S.A. Advisory Corporate News
SETO HOLDINGS INC (SETO.OB)Quarterly Report (SEC form 10QSB) ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
The Strategy, Critical Accounting Estimates and Outlook sections all contain a number of forward-looking statements, all of which are based on our current expectations. Our actual results may differ materially. These statements do not reflect the potential impact of any mergers, acquisitions, divestitures or other business combinations that had not closed as of June 5, 2003.
We are currently restating our previously issued financial statements for the two years ended January 31, 2002, including the corresponding fiscal 2002 and 2003 quarterly periods. The impact of the restatement on such prior periods was reflected as an adjustment to opening retained earnings as of February 1, 2001. The restatement will be reported in Amendment No. 2 to the Companys Annual Report on form 10-KSB/A for the years ended January 31 2001 and 2002 and Amendment No. 2 to the Companys Quarterly Reports on Form 10-QSB/A for the quarterly periods ended April 30, 2001 and 2002, July 31, 2001 and 2002, and October 31, 2001 and 2002.
Throughout the following Managements Discussion and Analysis of Financial Condition and Results of Operations, all amounts referencing prior periods and prior period comparisons reflect the balances and amounts on a restated basis.
Our goal is to be a niche company, with the ability to provide products and services to a variety of larger corporations who need contract manufacturing and/or made-to-order products. Our primary areas of focus are the fabrication of ceramic parts for the airline security business and jet engine manufacturing along with cutting blades for silicon wafers.
All of our businesses operate in competitive environments characterized by the introduction of new products with lower prices. As part of our overall strategy, we use our relatively small size and ability to provide niche services for larger companies in order to compete vigorously in each relevant market segment. Our competition comes from established businesses as well as new entrants to the marketplace. The trend in the United States (U.S.) toward HomeLand Security will offer us new opportunities, but will result in more competition. Competition tends to increase pricing pressure on our products, which may mean that we must offer our products at lower prices than we had anticipated, resulting in lower profits. Because some of our customers already have established products, it is inherently difficult for us to compete against them. In addition, certain market segments in which we compete, such as dicing blade products, have experienced an overall economic decline, increasing the degree of competition within this market segment. When we believe it is appropriate, we will take various steps, including discontinuing older products and reducing prices, in order to increase acceptance of our products and to be competitive within each relevant market segment.
We plan to continue to cultivate new businesses and work with the security and chip making industries to expand our product lines.
East Coast Sales Company East Coast Sales Company (ECS) operating segment specializes in the distribution and value-added fabrication of technical ceramic products for the airline security industry and jet engine manufacturers, and distributes clean room supplies and tools. Our strategy for ceramic fabrication is to increase our production efficiency by utilizing our foreign subsidiarys labor force and updating our machinery. After September 11th, East Coast Sales experienced an increase in demand for its ceramic products used in the manufacture of airport safety and detection devices. Our three major customers are developing new products which will require our ceramic products. In addition to airport security devices, our ceramic products are used in military defense equipment such as missiles, and by manufacturers of jet engines for both commercial and military use. To increase the acceptance and deployment of our ceramic products, we are focused on providing our customers with the highest quality products and services.
Table of Contents
Semicon Tools and DTI Technology Semicon Tools and DTI Technology operating segments strategy is to produce quality diamond cutting tools for the semiconductor industry. We plan to improve the quality and capability of our diamond cutting products that we currently have on the market. We are currently consulting with an outside source in Taiwan to improve our manufacturing process and diamond tool technology. The diamond tool segment is very dependent on the semiconductor industry which over last three years has experienced economic decline and is still not showing signs of growth. The diamond blades manufactured by DTI Technology are a vital part of East Coast Sales ceramic fabrication process.
SETO Technology SETO Technologys strategy is to provide contract-manufacturing services for personal electronic safety devices and to produce medical, automotive and mining safety devices. This segment is currently developing and selling medical training products, auto safety devices and safety helmets. Currently this segments main product is a CPR training device used by the medical industry. We have five different models under contract on an exclusive and nondisclosure basis. SETO Technology has also contracted with a third party to develop and manufacture a safety helmet that we expect to bring to market in fiscal 2004. As of April 30, 2003 we have advanced a total of $231,867 to the developer who is producing the tooling and molds to be used in the manufacturing process of the helmet. We expect to start depreciating and expensing these costs when we begin producing the helmets in the fourth quarter of this fiscal year.
Critical Accounting Estimates
The methods, estimates and judgments we use in applying our accounting policies have a significant impact on the results reported in our financial statements. Some of these accounting policies require us to make difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. Our most critical accounting estimates include the assessment of recoverability of goodwill, which impacts write-offs of goodwill; valuation of inventory, which impacts gross margin; assessment of recoverability of long-lived assets, which primarily impacts gross margin when we impair assets or accelerate their depreciation; and recognition and measurement of current and deferred income tax assets and liabilities, which impacts our tax provision. Below we discuss these policies further, as well as the estimates and judgments involved. We also have other policies that we consider to be key accounting policies, such as our policy for revenue recognition; however, this policy does not meet the definition of critical accounting estimates because they generally require us to make estimates or judgments that are difficult or subjective.
Goodwill According to our accounting policy we perform an annual impairment review in the fourth quarter of each year, or more frequently if indicators of potential impairment exist. Our most recent review was in the fourth quarter of fiscal 2003 (January 31, 2003). Our impairment review process is based on a discounted future cash flow approach that uses our estimates of revenue for the reporting unit, driven by assumed market growth rates and assumed segment share, and estimated costs as well as appropriate discount rates. These estimates are consistent with the plans and estimates that we use to manage the underlying business. In the future, we may incur charges for impairment of goodwill if the ceramic fabrication business experiences an economic downturn, new technology becomes available, we lose market acceptance, we fail to deliver new products, or if we fail to achieve our assumed revenue growth rates or assumed gross margin.
Inventory Our policy for valuation of inventory, including the determination of obsolete or excess inventory requires us to estimate the future demand for our products within specific time horizons, generally one year or less. If our demand forecast for specific products is greater than actual demand and we fail to reduce manufacturing output accordingly, we could be required to record additional inventory reserves, which would have a negative impact on our gross margin.
Long-Lived Assets We assess the impairment of long-lived assets when events or changes in circumstances indicate that the carrying value of the assets or the asset grouping is not recoverable. Factors that we consider in deciding when to perform impairment review include significant under-performance of a business or product line in relation to expectations, significant negative industry or economic trends, and significant changes in our use of the assets. Recoverability of assets that will continue to be used in our operations is measured by comparing the carrying amount of the assets grouping to the related total future net cash flows. If an assets grouping carrying value is not recoverable through those cash flows, the asset grouping is considered to be impaired. The impairment is measured by the difference between the assets carrying amount and their fair value, based on the best information available, including market prices or discounted cash flow analysis.
Table of Contents
Income Taxes In determining income for financial statement purposes, we must make certain estimates and judgments. These estimates and judgments occur in the calculation of certain tax liabilities and in the determination of the recoverability of certain tax assets, which arise from temporary differences between the tax and financial statement recognition of revenue and expense. As of April 30, 2003, taxes were not provided on approximately $58,080 of undistributed earnings of foreign subsidiaries, as we invest or expect to invest the undistributed earnings indefinitely. If in the future these earnings are repatriated to the United States, or if we determine such earnings will be remitted in the foreseeable future, additional tax provisions would be required.
We must assess the likelihood that we will be able to recover our deferred tax assets. If recovery is not likely, we must increase our provision for taxes by recording a reserve, in the form of a valuation allowance, for the deferred tax assets that we estimate will not ultimately be recoverable. As of April 30, 2003, we believe that our recorded deferred tax assets will ultimately be recovered. However, should there be a change in our ability to recover our deferred tax assets; our tax provision would increase in the period in which we determine that the recovery is not probable.
In addition, the calculation of our tax liabilities involves dealing with uncertainties in the application of complex tax regulations. We recognize potential liabilities for anticipated tax audit issues in the U.S. and other tax jurisdictions based on our estimate of whether, and the extent to which, additional taxes will be due. If payment of these amounts ultimately proves to be unnecessary, the reversal of the liabilities would result in tax benefits being recognized in the period when we determine the liabilities are no longer necessary. If our estimate of tax liabilities proves to be less than the ultimate assessment, a further charge to expense would result.
Results of Operations
The following table sets forth certain consolidated statements of income data as a percentage of net revenue for the periods indicated:
Q1 2003 Q1 2004 Restated ------------ ------------ Net revenues 100.00 % 100.00 %
Cost of sales 40.51 % 40.89 % ------ ------ Gross margin 59.49 % 59.11 %
Selling, general and administrative expenses 49.24 % 33.45 %
Amortization of goodwill 0.00 % 0.00 %
Amortization and impairment of acquisition-related
intangibles 1.46 % 0.00 % ------ ------ Operating income 8.78 % 25.66 % ------ ------
Our net revenue for Q1 2004 of $1,021,185 was down approximately 30% compared to Q1 2003, primarily due to the decrease in demand for our ceramic products used by the airline security manufacturing industry. Net revenue for our diamond tool segment was down 19% compared with Q1 2003 which is primarily due to the weak global semiconductor market. Our contract manufacturing revenues were down 62% compared with Q1 2003, primarily due to a technical change that a major customer is making to their personal safety device that SETO Technology manufactures for them. We expect to begin producing this new product in Q3 of this fiscal year.
Our gross margin percentage in Q1 2004 of 59% was flat compared to Q1 2003. The gross margin for our diamond tool segment was higher compared to Q1 2003; and our gross margins for our contract manufacturing segment was down, which was primarily due to the lack of sales volume. See Outlook for a discussion of gross margin expectations.
Table of Contents
Ceramics East Coast Sales Company
The revenue and operating income for the East Coast Sales Company operating segment for the first quarter of 2004 and 2003 were as follows:
Q1 2003 Q1 2004 Restated ----------- ------------- Revenue $ 758,530 $ 1,005,339
Operating income $ 124,847 $ 369,972
The East Coast Sales Company operating segment is our ceramics division, which experienced a decrease in sales due to the decreased demand from the airline security manufacturing industry. Net revenues for this segment decreased $246,809 or 25% in Q1 2004 compared to Q1 2003. The decrease in revenue was due to lower sales of custom cut ceramics that are used in airport security devices.
Net operating income for the East Coast Sales Company operating segment decreased by $245,125 or 66% compared to Q1 2003 primarily due to the decrease in demand from the industries mentioned above.
Diamond Tools Semicon Tools/DTI Technology
The revenue and operating income for the diamond tool operating segment for the first quarter of 2004 and 2003 were as follows:
Q1 2003 Q1 2004 Restated ------------ ------------ Revenue $ 211,757 $ 262,884
Operating loss ($27,993 ) ($36,209 )
Net revenue in Q1 2004 was down $51,127 or 19%, compared to Q1 2003. The net operating loss for Q1 2004 decreased $8,216 or 23%, compared to Q1 2003. The decrease in the net operating loss from fiscal Q1 2003 to Q1 2004 was primarily due to lower labor and overhead costs.
Contract Manufacturing SETO Technology
The revenue and operating income for the contract manufacturing operating segment for the first quarter of 2004 and 2003 were as follows:
Q1 2003 Q1 2004 Restated ----------- ----------- Revenue $ 70,898 $ 185,342
Operating income (loss) ($7,220 ) $ 39,221
Net revenue for Q1 2004 was down $114,444 or 62%, compared to Q1 2003, primarily due to a major customer who is currently redesigning a product that SETO Technology produces. The lack of sales volume also contributed to the operating loss of $7,220 we experienced in Q1 2004. Sales will continue to lag behind fiscal 2003 until the third quarter when we expect to begin production of our customers newly designed product.
Operating expenses for the first quarter of 2004 and 2003 were as follows:
Q1 2003 Q1 2004 Restated --------------------- --------------------- Selling, general and administrative expenses $ 502,855 $ 486,285
Amortization and impairment of
acquisition-related intangibles $ 15,000 $ 0
Selling, general and administrative expenses increased $16,570, or 3% compared to Q1 2003. This increase was primarily due to slightly higher administrative expenses.
Table of Contents
Amortization and impairment of acquisition-related intangibles increased $15,000 in Q1 2004 compared to Q1 2003, which was due to the amortization of the customer lists we purchased in fiscal 2002. If market conditions change and it is deemed that the customer lists do not have any future benefit and become impaired, we may write off the entire amount, which would have a negative effect on our operating income.
Interest and Other, Net
Interest and other, net and taxes for the first quarter of 2004 and 2003 were as follows:
Q1 2003 Q1 2004 Restated ----------- ------------ Interest income $ 9,923 $ 5,805
Gain (loss) on sale of assets $ 31,749 $ 0
Interest expense ($4,793 ) ($69,607 )
Foreign currency exchange loss ($249 ) ($341 )
Provision for income taxes (benefit) $ 22,561 ($67,081 )
In Q1 2004, interest income increased primarily due to the payments we received on our note receivable from G-Com Net.
In Q1 2004 we sold some equipment in Malaysia for a gain of $31,749. The equipment consisted of an automobile and a dicing saw that our diamond tool segment DTI Technology sold during the first quarter of fiscal 2004.
Interest expense decreased $64,814, or 93%, to $4,793 in Q1 2004 compared to $69,607 in Q1 2003. This decrease was primarily due to us paying down our line-of-credit during the first quarter of fiscal 2004. See Financial Condition section for a more detailed discussion of our financing activities.
Foreign currency exchange loss was relatively flat compared to Q1 2003. We experience currency translation gains or losses when we purchase items from foreign countries (other than Malaysia) whose currencies are not pegged to the U.S. Dollar. Historically, these gains and losses have been insignificant and therefore we do not expect any significant losses in the future.
Our effective income tax rate was 32% in Q1 2004 compared to an effective income tax benefit of 43% for Q1 2003. The increase in the effective rate in Q1 2004 is primarily due to the growth in net income from our U.S. operating segment East Coast Sales Company. This net income will absorb a portion of our federal net operating loss carryforward. The effective rate in Q1 2003 benefited from us increasing our deferred tax assets due to our expected increase in profitability in the U.S. We expect to realize the full benefit of our net operating loss carryover by fiscal 2005.
As discussed below, in fiscal 2003, we have exited the business of manufacturing consumer electronic products and rechargeable and other batteries for consumer products. On February 1, 2001, we adopted a formal plan to sell Fuji Fabrication, Sdn. Bhd. On October 1, 2001; we sold the assets, which consisted primarily of inventory and equipment of Fuji Fabrication to G Com Net for $290,547. We assumed a 10% note for the full amount of the selling price which was due on September 30, 2002. On October 1, 2002 at the request of G Com Net, we increased the principal amount of the note to $396,693 due to sales of additional inventory and previously accrued interest and extended its maturity so the note is payable in full on September 30, 2003. Currently we believe G Com Net will repay the note on its due date. As of June 6, 2003, G Com Net is current with all interest payments required by the new note. If conditions change and there is a definite indication that the note is impaired we would then have to write off the note in full. This would have a negative effect on our net income (loss) from discontinued operations.
Table of Contents
On October 31, 2002, we adopted a formal plan to discontinue the operations of Hong Kong Batteries Industries, Ltd. (Hong Kong Batteries). Hong Kong Batteries was a trading company that bought industrial batteries from manufacturers in mainland China and resold them to companies in Hong Kong, Asia and Europe. When China was approved for World Trade Organization Status (WTO) at the end of 2001, without our knowledge most of Hong Kong Batteries suppliers hired English speaking sales and marketing managers and began to directly approach all the end user customers of Hong Kong Batteries. During the first and second quarters of fiscal 2003, Hong Kong Batteries was still receiving orders from its customers. Then during the third quarter it did not receive any orders and was informed by its customers that the Chinese suppliers offered substantial discounts if they bought their products directly from the Chinese manufacturers. After many discussions and meetings with the management of Hong Kong Batteries, we could not overcome the problem and decided to cease operations as soon as possible due to the lack of revenue and the high overhead cost we would have incurred if we continued operating.
The discontinuance of Hong Kong Batteries Industries, Ltd resulted in us writing off $688,183 in goodwill and incurring an additional $225,759 in disposal costs, which consisted mainly of the write off of cash advances to Hong Kong Batteries and travel expenses.
In conjunction with the discontinuance of the operations of Fuji Fabrication and Hong Kong Batteries, we have accrued $34,000 for additional estimated disposition costs. As of April 30, 2003 we have not incurred any expenses relating to the disposition of Fuji Fabrication and Hong Kong Batteries.
The components of income (loss) from discontinued operations of subsidiaries are as follows:
Fuji Fabrication Q1 2003 Q1 2004 Restated ----------- ----------- Net sales $ 0
Cost of sales 0 ------- ------- Gross income (loss) 0 0 ------- ------- Selling, general and administrative expenses 1,339 3,219 ------- ------- Other income (expense) 0 0 ------- ------- Net loss ($1,339 ) ($3,219 ) ------- ------- Hong Kong Batteries
Q1 2004 Restated ------- ------- Net sales $ 0 $ 382,274
Cost of sales 0 313,520 ------- ------- Gross income 0 68,754 ------- ------- Selling, general and administrative expenses 0 60,498 ------- ------- Other income (expense) 0 199 ------- ------- Net income $ 0 $ 8,455 ------- -------
Table of Contents
Our financial condition remains strong. At April 30, 2003, cash totaled $300,925, down from $508,414 at January 31, 2003. At April 30, 2003, total short-term and long-term debt was $532,673, a decrease of $573,936 compared to January 31, 2003. At April 30, 2003, total debt was $532,673 which represented 16% of stockholders equity.
For Q1 2004, cash provided by operating activities was $317,884, compared to $301,173 in Q1 2003. Cash was provided by net income adjusted for non-cash related items. Working capital uses of cash included an increase in prepaid expenses, deferred product development costs and other assets and a decrease in accounts payable and accrued expenses. For Q1 2004, net cash provided by discontinued operations was $4,805, compared to cash used in discontinued operations of $69,697 in Q1 2003. This increase was primarily due to an increase in loan payable to a director. For Q1 2004, our three largest customers accounted for approximately 62% of net revenue, with one of these customers accounting for approximately 44% of net revenue. At April 30, 2003, these three largest customers accounted for approximately 47% of net accounts receivable.
We used $30,110 in net cash for investing activities during Q1 2004, compared to $46,804 during Q1 2003. The decrease in cash used for investing activities as compared to Q1 2003 was due to the sale of equipment during Q1 2004. Capital expenditures in Q1 2004 increased $29,266 compared to fiscal 2002 primarily due to the purchase of a new vehicle to replace the one that we sold during the first quarter of 2004. We anticipate capital expenditures of $250,000 for fiscal 2004.
We used $495,263 in net cash for financing activities in Q1 2004, which increased from $287,940 in Q1 2003. The major financing uses of cash for Q1 2004 and Q1 2003 were the repayment of debt and repurchase of our common stock. In Q1 2004, we purchased 20,000 shares of our common stock for $5,415. Financing sources of cash of $171,364 during Q1 2004 were primarily from amounts we drew down on our revolving line-of-credit. In addition we paid back at total of $650,000 on the line of credit during Q1 2004. We have another potential source of liquidity from authorized borrowings in the form of a line-of-credit with a U.S. financial institution for $1.7 million. At April 30, 2003, we had $1,633,611 available for use from this line of credit.
We believe that we have the financial resources needed to meet our anticipated business requirements for the next 12 months, including capital expenditures for the expansion or upgrading of our manufacturing capacity and working capital requirements.
In general, as we look ahead to the rest of fiscal 2004, the outlook continues to be uncertain, and we anticipate a year that will be largely driven by the airline security, military, jet engine and semiconductor industries as well as the global economy. Although it is difficult to predict product demand for the rest of fiscal 2004, we expect a 30% to 40% decrease in revenue from our ceramic segment, East Coast Sales Company. During the second quarter of fiscal 2004 we may be able to better forecast ceramic sales more accurately due to the Department of HomeLand Security issuing new orders for security devices. The outlook for the diamond tools industry continues to be weak. We are trying to cut costs in order to compete with other manufacturers and we are planning to improve the quality and capability of our diamond cutting products. The diamond tool industry is very dependent on the semiconductor industry, which over last three years has experienced economic decline and is still not showing signs of growth. The outlook for the contract manufacturing segment remains strong, however, a major customer is currently redesigning its product that we manufacture and this will have an adverse effect on our net revenue and operating profit for the second quarter of fiscal 2004. We expect to start producing the redesigned product by the third quarter of this year. In addition, we have a contract with a third party to develop and manufacture a safety helmet that we expect to bring to market in late fiscal 2004. In this environment, revenue growth for our new safety helmet is largely dependent on the commercial acceptance of our current designs and successfully marketing the designs to the safety and rescue industries, which we can not assure.
Our financial results are substantially dependent on sales of ceramics and related products by the East Coast Sales Company operating segment. Revenue is partly a function of the mix of products we offer, all of which are difficult to forecast. Because of the changing conditions throughout the world our revenue is subject to the impact of economic conditions in various geographic regions.
Our gross margin expectation for fiscal 2004 is approximately 54% plus or minus a few points, which is a slight increase from the fiscal 2003 gross margin of 51%. Our gross margin varies depending on unit sales volumes and
Table of Contents
product mixes. Our policy for valuation of inventory, including the determination of obsolete inventory, requires us to estimate the future demand for our products within six months or less. The estimates of future demand that we use in the valuation of inventory are also used for near-term factory planning. If our demand forecast is greater than actual demand and we fail to reduce manufacturing output accordingly, we would likely be required to record additional inventory reserves, which would have a negative impact on our gross margin. Various other factors including unit sales volumes and new technologies will also continue to affect cost of sales and the variability of gross margin percentages.
In fiscals 2003 and 2002 we improved our cutting blade facility and updated our ceramics fabrication facility. We expect that capital spending will increase to $250,000 for fiscal 2004 from $ 124,785 in fiscal 2003. The increase is primarily due to the expected tooling equipment needed to produce our new safety helmet. If market demand does not grow or our new products are not accepted, revenues and gross margins may also be adversely affected.
Depreciation for fiscal 2004 is expected to be approximately $150,000, compared to $141,488 in fiscal 2003. Most of this increase would be included in cost of sales.
We expect amortization of other intangible assets to be approximately $60,000 in fiscal 2004, as compared to $10,000 in fiscal 2003. As of April 30, 2003 amortization expense totaled $15,000.
We review our acquisition-related intangible assets for impairment whenever indicators of potential impairment exist. We also review goodwill for impairment in the fourth quarter of each year, or earlier if indicators of potential impairment exist. If we fail to deliver products for this group, if our new products fail to gain market acceptance, or if market conditions in the ceramic business decline, our revenue and cost forecasts may not be achieved and we may incur charges for impairment of goodwill.
We expect our tax rate to be approximately 27% for fiscal 2004. This estimate is lower than the rate in fiscal 2003, primarily due the anticipated decrease in net revenues from our East Coast Sales Company operating segment and the use of our available net operating loss carryover for federal income tax purposes. The expected rate is based on current tax law and is subject to change.
Our future results of operations and the other forward-looking statements contained in this Outlook section and in our Strategy and Critical Accounting Estimates sections involve a number of risks and uncertainties, in particular the statements regarding our strategies, our expectations regarding new products, future economic conditions, revenues, gross margin and costs, capital spending and depreciation and amortization. In addition to the factors discussed above, among the other factors that could cause actual results to differ materially are the following: business and economic conditions and trends in the airline security business, jet engine manufacturers, microchip industry, and safety industries in various geographic regions; possible disruption in commercial activities related to terrorist activity and armed conflict, such as change in logistics and security arrangements, and reduced end-user purchases relative to expectations; the impact of events outside the United States, such as the business impact of fluctuating currency rates, unrest or political instability in a locale; changes in customer order patterns; competitive factors and acceptance of new products in specific market segments; pricing pressures; excess or obsolete inventory and variations in inventory valuation and the spread of SARS illness could adversely affect our business and our customer order patterns.
We believe that we have the products, facilities, personnel and financial resources for continued business success, but future revenues, costs, margins and profits are all influenced by a number of factors, including those discussed above, all of which are inherently difficult to forecast.
Quantitative and Qualitative Disclosures about Market Risk
We are exposed to financial market risks, including changes in currency exchange rates and interest rates. We do not try to mitigate these risks by utilizing derivative financial instruments or other risky strategies.
A substantial majority of our revenue, expense, and capital purchasing activities are transacted in U. S. dollars. However, we do enter into these transactions in other currencies, primarily the Malaysian Ringgit. The Malaysian Ringgit is pegged to the U.S. Dollar and is translated to U.S. dollars for consolidated purposes. In Q1 2004 we reported a foreign currency exchange loss of $249, compared to a loss of $341 in Q1 2003, neither of which materially impacted the financial statements.
Inflation has not had a material effect on our revenues and income from continuing operations in the past four years. Inflation is not expected to have a material future effect.
Copyright © 2010 S.A. Advisory