Value Microcaps Motherboard

[stanu78]

MDF CC & Q&A recap

1. They started recording income tax in the income statement and charge it against the tax deferred asset (no tax paid on cash basis till the NOL is expired)

2. No guidance given for earning nor capex (and they don't plan to give guidance in the foreseeable future)

3. Growth expected is about 6% in 2005 (from Humana. it was more than 10% including Careplus 50K member acquisition). MDF expect a bit better than that. (not sure if thisis a form of guidance nor the ability for us to held them accountable on this claim)

4. They started reporting on member month which I think a great measurement. also makign some change in the cost reported on direct medical cost/reimbursed cost (I'm not clear on what this cost is about nor I can see it in the income statement)

5. Cost for HMO will start to ramp up once the CMS has approved them (so they can start marketing and start booking accounts). while revenue will come right away too as soon as they booked accounts.

7. Average premium is about $8,400 per year ($700/mo) for HMO member. (compare to about $6000 - $7200 for managing the risk/PSN members only)

8.Medicare advantage total eligible in the 6 counties is 355K. only 6% currently aprticipate because of not enough offer for them

9. CMS is currently very busy as there are other new applicants for this service. (meaning there are potential competitors for MDF, not sure if they are cometing in the same counties as it is not elaborated)

10. Not a lot of cap ex expected. (only desk and computer type of cap ex). all the big stuff will be outsourced (like computer system/software to manage various new tasks). Mike said he wants to use their capital smartly/carefully.

All in all it's pretty simple result/operation.. which I like.. keep it simple...
Folks, do me a favor... don't sell your shares today... :)
I'm not selling either...

Stan