Alloy Steel Inc. (fka AYSI)

[gilead23]

Inventories Oh My!

I can't believe I made that mistake given I was harping on inventory but of course inventories are valued at LCM. So inventories are going to translate into more than double their value in actual sales since part of COGS includes labor.

That means had that inventory shipped they likely would have beat last quarter. That in turn means if those finished goods actually ship and all else stays equal next quarter would be beyond a blowout.

Lets just assume for argument sake that actual inventory accounts for 40% of sales cost a very conservative number for our purposes.

That means that 800k in finished goods represents 2 million in revenue. They would have done 4.5 million in revenue had it shipped. Now imagine that ships this Q plus they do another 4.8 million given some modest contribution from the new mill.

You could have topline revenues of roughly 7 million next quarter!

Take that 7 million and apply a 55% gross margin to the incremental sales and I think you would see quarter EPS number of something like .14/share.