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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

PERFORMANCE EVALUATION REPORT, QUARTER 4 PAGE 1

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+------+------Industry ------+

| Firm 5 | Worst Average Best |

------+------+------+

FINANCIAL | | |

Net Income to Revenues | 5.3%| 4.8% 5.3% 5.7%|

Change in Net Income to Revenues | 0.4%| 0.2% 0.9% 2.3%|

------+------+------+

OPERATIONAL | | |

Forecasting Accuracy | 85.9%| 85.9% 87.6% 89.2%|

(Marketing + Service) to Revenues | 11.2%| 11.3% 11.1% 10.8%|

------+------+------+

CUSTOMER | | |

Change in Market Share | -0.6%| -1.1% 0.0% 2.0%|

Customer Satisfaction | 18.4%| 18.3% 18.7% 19.5%|

------+------+------+

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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

LINKS DASHBOARD, QUARTER 4 PAGE 1

*****************************************************************************

Quarter 3 Quarter 4

+------+------+

Sales Volume | 162,022 | 155,401 |

------+------+------+

Price | 372 | 376 |

------+------+------+

Revenues | 60,407,850 100.0% | 58,578,395 100.0% |

Product Costs | 28,568,983 47.3% | 26,731,752 45.6% |

Gross Margin | 19,128,206 31.7% | 19,448,272 33.2% |

Net Income | 2,949,897 4.9% | 3,117,599 5.3% |

+------+------+


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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

CORPORATE P&L STATEMENT, QUARTER 4 PAGE 2

*****************************************************************************

All Products Product 5-1 Product 5-2

------

Sales Volume 155,401 108,718 46,683

Price 376 345 449

Revenues 58,578,395 37,585,280 20,993,115

- Product Costs 26,731,752 15,307,492 11,424,260

- Order Processing 2,474,224 1,921,412 552,812

- Replacement Parts 911,577 443,752 467,825

- Transportation Costs 5,338,768

- Duties & Tariffs 3,673,802 2,640,158 1,033,644

------

Gross Margin 19,448,272 17,272,466 7,514,574

Gross Margin % 33.2% 46.0% 35.8%

Fixed & Other Costs:

Administrative O/H 3,240,000 1,800,000 1,440,000

Consulting Fees 0

Corporate O/H 1,500,000

Distribution FC 25,000

Forecast Inaccuracy 439,185 293,089 146,096

Information Technology 17,000

Introductions 0

Marketing 4,400,000 2,400,000 2,000,000

Marketing Creative 0 0 0

Plant Capacity FC 1,200,000

Price Changes 0 0 0

Production FC 141,000

Reconfiguration 0

R&D 0

Research Studies 0

Service Outsourcing 2,162,089 1,535,111 626,978

Total Fixed & Other 13,124,274 6,028,200 4,213,074

------

Operating Income 6,323,998 11,244,266 3,301,500

------

Non-Operating Income -88,801

Patent Royalties 0

Taxes -3,117,598

======

Net Income 3,117,599

======


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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

HISTORICAL CORPORATE P&L STATEMENT, QUARTER 4 PAGE 3

*****************************************************************************

Previous (Quarter 3) Current (Quarter 4)

------

Sales Volume 162,022 155,401

Price 372 376

Revenues 60,407,850 100.0% 58,578,395 100.0%

- Product Costs 28,568,983 47.3% 26,731,752 45.6%

- Order Processing 2,493,368 4.1% 2,474,224 4.2%

- Replacement Parts 915,127 1.5% 911,577 1.6%

- Transportation Costs 5,515,308 9.1% 5,338,768 9.1%

- Duties & Tariffs 3,786,858 6.3% 3,673,802 6.3%

------

Gross Margin 19,128,206 31.7% 19,448,272 33.2%

Fixed & Other Costs:

Administrative O/H 3,240,000 5.4% 3,240,000 5.5%

Consulting Fees 0 0.0% 0 0.0%

Corporate O/H 1,500,000 2.5% 1,500,000 2.6%

Distribution FC 25,000 0.0% 25,000 0.0%

Forecast Inaccuracy 383,863 0.6% 439,185 0.7%

Information Technology 17,000 0.0% 17,000 0.0%

Introductions 0 0.0% 0 0.0%

Marketing 4,400,000 7.3% 4,400,000 7.5%

Marketing Creative 0 0.0% 0 0.0%

Plant Capacity FC 1,200,000 2.0% 1,200,000 2.0%

Price Changes 0 0.0% 0 0.0%

Production FC 141,000 0.2% 141,000 0.2%

Reconfiguration 0 0.0% 0 0.0%

R&D 0 0.0% 0 0.0%

Research Studies 0 0.0% 0 0.0%

Service Outsourcing 2,172,446 3.6% 2,162,089 3.7%

Total Fixed & Other 13,079,309 21.7% 13,124,274 22.4%

------

Operating Income 6,048,897 10.0% 6,323,998 10.8%

------

Non-Operating Income -149,104 -0.2% -88,801 -0.2%

Patent Royalties 0 0.0% 0 0.0%

Taxes -2,949,896 -4.9% -3,117,598 -5.3%

======

Net Income 2,949,897 4.9% 3,117,599 5.3%

======


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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

PRODUCT 5-1 P&L STATEMENT, QUARTER 4 PAGE 4

*****************************************************************************

All Regions Region 1 Region 2 Region 3

(TOTAL ) ( U.S.A.) ( Europe) ( Pacific)

------

Active? Ch#1,2 Yes Yes Yes Yes Yes Yes

Sales Volume, Ch#1 34,391 13,904 5,708 14,779

Sales Volume, Ch#2 74,327 23,939 17,662 32,726

Price, Ch#1,2 250 390 250 390 250 390 250 390

Revenues 37,585,280 12,812,210 8,315,180 16,457,890

- Product Costs 15,307,492 5,328,294 3,290,495 6,688,703

- Order Processing 1,921,412 630,152 446,720 844,540

- Replacement Parts 443,752 152,391 100,568 190,793

- Duties & Tariffs 2,640,158 0 665,213 1,974,945

------

Gross Margin 17,272,466 6,701,373 3,812,184 6,758,909

Gross Margin % 46.0% 52.3% 45.8% 41.1%

Fixed Costs:

Administrative O/H 1,800,000 600,000 600,000 600,000

Forecast Inaccuracy 293,089 64,758 130,249 98,082

Marketing, Ch#1 1,200,000 400,000 400,000 400,000

Marketing, Ch#2 1,200,000 400,000 400,000 400,000

Marketing Creative 0 0 0 0

Price Changes 0 0 0 0

Service Outsourcing 1,535,111 445,060 351,300 738,751

Total Fixed Costs 6,028,200 1,909,818 1,881,549 2,236,833

------

Operating Income 11,244,266 4,791,555 1,930,635 4,522,076

======

Sales Volume Forecast, Ch#1 12,434 7,748 13,151

Sales Volume Forecast, Ch#2 21,320 15,480 26,213

Service: Service Outsourcing 2 Standard 2 Standard 2 Standard

Product 5-1 Configuration: H55111

Product 5-1 R&D Spending: 0


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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

PRODUCT 5-1 P&L STATEMENT, QUARTER 4 (MARKETING PROGRAM DETAILS) PAGE 5

*****************************************************************************

Region 1 Region 2 Region 3

( U.S.A.) ( Europe) ( Pacific)

------

Marketing Program, Channel #1:

Marketing Spending: 400,000 400,000 400,000

Advertising Spending 160,000 160,000 160,000

Promotion Spending 120,000 120,000 120,000

Sales Force Spending 120,000 120,000 120,000

Marketing Mix Allocation 403030 403030 403030

Positioning 37 37 37

Promotional Program 49 49 49

Sales Force Spending ($/Quarter) 120,000 120,000 120,000

Sales Force O/H Rate 2.50 2.50 2.50

Sales Force Salary ($/Month) 3,250 3,250 3,250

Sales Force Size 3.52 3.52 3.52

Marketing Program, Channel #2:

Marketing Spending: 400,000 400,000 400,000

Advertising Spending 160,000 160,000 160,000

Promotion Spending 120,000 120,000 120,000

Sales Force Spending 120,000 120,000 120,000

Marketing Mix Allocation 403030 403030 403030

Positioning 37 37 37

Promotional Program 49 49 49

Sales Force Spending ($/Quarter) 120,000 120,000 120,000

Sales Force O/H Rate 2.50 2.50 2.50

Sales Force Salary ($/Month) 3,250 3,250 3,250

Sales Force Size 3.52 3.52 3.52


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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

PRODUCT 5-2 P&L STATEMENT, QUARTER 4 PAGE 6

*****************************************************************************

All Regions Region 1 Region 2 Region 3

(TOTAL ) ( U.S.A.) ( Europe) ( Pacific)

------

Active? Ch#1,2 Yes Yes Yes Yes Yes No

Sales Volume, Ch#1 28,379 13,182 4,614 10,583

Sales Volume, Ch#2 18,304 9,154 9,150 0

Price, Ch#1,2 385 550 385 550 385 550 385 550

Revenues 20,993,115 10,109,770 6,808,890 4,074,455

- Product Costs 11,424,260 5,466,064 3,368,325 2,589,871

- Order Processing 552,812 272,424 238,056 42,332

- Replacement Parts 467,825 214,033 141,808 111,984

- Duties & Tariffs 1,033,644 0 544,710 488,934

------

Gross Margin 7,514,574 4,157,249 2,515,991 841,334

Gross Margin % 35.8% 41.1% 37.0% 20.6%

Fixed Costs:

Administrative O/H 1,440,000 600,000 600,000 240,000

Forecast Inaccuracy 146,096 79,742 24,514 41,840

Marketing, Ch#1 1,200,000 400,000 400,000 400,000

Marketing, Ch#2 800,000 400,000 400,000 0

Marketing Creative 0 0 0 0

Price Changes 0 0 0 0

Service Outsourcing 626,978 261,770 204,996 160,212

Total Fixed Costs 4,213,074 1,741,512 1,629,510 842,052

------

Operating Income 3,301,500 2,415,737 886,481 -718

======

Sales Volume Forecast, Ch#1 11,392 5,080 12,428

Sales Volume Forecast, Ch#2 10,353 9,157 0

Service: Service Outsourcing 2 Standard 2 Standard 2 Standard

Product 5-2 Configuration: M55532

Product 5-2 R&D Spending: 0


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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

PRODUCT 5-2 P&L STATEMENT, QUARTER 4 (MARKETING PROGRAM DETAILS) PAGE 7

*****************************************************************************

Region 1 Region 2 Region 3

( U.S.A.) ( Europe) ( Pacific)

------

Marketing Program, Channel #1:

Marketing Spending: 400,000 400,000 400,000

Advertising Spending 160,000 160,000 160,000

Promotion Spending 120,000 120,000 120,000

Sales Force Spending 120,000 120,000 120,000

Marketing Mix Allocation 403030 403030 403030

Positioning 37 37 37

Promotional Program 49 49 49

Sales Force Spending ($/Quarter) 120,000 120,000 120,000

Sales Force O/H Rate 2.50 2.50 2.50

Sales Force Salary ($/Month) 3,250 3,250 3,250

Sales Force Size 3.52 3.52 3.52

Marketing Program, Channel #2:

Marketing Spending: 400,000 400,000 0

Advertising Spending 160,000 160,000 0

Promotion Spending 120,000 120,000 0

Sales Force Spending 120,000 120,000 0

Marketing Mix Allocation 403030 403030 403030

Positioning 37 37 37

Promotional Program 49 49 49

Sales Force Spending ($/Quarter) 120,000 120,000 0

Sales Force O/H Rate 2.50 2.50 2.50

Sales Force Salary ($/Month) 3,250 3,250 3,250

Sales Force Size 3.52 3.52 0.00


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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

BALANCE SHEET, QUARTER 4 PAGE 8

*****************************************************************************

ASSETS

------

Cash 2,928,919

Marketable Securities 0

Finished Goods Inventory 0

Plant Investment 105,000,000

Total Assets 107,928,919

LIABILITIES AND EQUITIES

------

Corporate Capitalization 100,000,000

Dividends, Current Quarter -935,279

Dividends, Cumulative Prior To This Quarter -2,172,931

Loans 676,425

Retained Earnings, Current Quarter 3,117,599

Retained Earnings, Cumulative Prior To This Quarter 7,243,105

Total Liabilities and Equities 107,928,919


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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

CASH FLOW ANALYSIS REPORT, QUARTER 4 PAGE 9

*****************************************************************************

Starting "Cash" Balance (Final "Cash" Balance, Quarter 3) 3,020,392

+ Marketable Securities (Converted To "Cash" In Quarter 3) 0

- "Loans" (Liquidated During Quarter 3) -2,950,218

+ "Finished Goods Inventory" Changes:

Product 5-1 (From 0 To 0) 0

Product 5-2 (From 0 To 0) 0

+ "Plant Investment" Changes 0

+ "Net Income" 3,117,599

= Preliminary "Cash" Balance 3,187,773

- "Dividends" (Paid at End of Quarter 4) -935,279

= Actual "Cash" Balance (End of Quarter 4) 2,252,494

- Operating "Cash" Excess (To "Marketable Securities") 0

+ Operating "Cash" Deficit (From "Loans") 676,425

= Final "Cash" Balance (End of Quarter 4) 2,928,919

Notes:

(1) "Marketable Securities" and "Loans" refer to the values on last

quarter's balance sheet.

(2) Investment changes can be positive, negative, or zero. A positive

(negative) {zero}. Investment change corresponds to an increase (a

decrease) {no change} in the dollar value of the investment from last

quarter to this quarter which leads to a decrease (an increase)

(no change) in current-quarter "Cash" balance.

(3) At most, one of Operating "Cash" Excess and Operating "Cash" Deficit will

be non-zero; it is possible for both to be zero. Recall that "Cash" must

be between 5.0% and 10.0% of current-quarter sales revenues. Excess

"Cash" (above 10.0% of revenues) is invested in "Marketable Securities";

shortfalls in "Cash" (below 5.0% of revenues) result in "Loans."


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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

SERVICE CENTER OPERATIONS REPORT, QUARTER 4 PAGE 10

*****************************************************************************

All Region Region Region

Regions 1 2 3

------

======

ACTIVITY REPORT

======

PRODUCT 5-1

Calls 130,608 44,506 29,275 56,827

CSR Cost/Call 11.75 10.00 12.00 13.00

PRODUCT 5-2

Calls 55,584 26,177 17,083 12,324

CSR Cost/Call 11.28 10.00 12.00 13.00


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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

TRANSPORTATION COST REPORT, QUARTER 4 PAGE 11

*****************************************************************************

======Surface Air Emergency

SUB-ASSEMBLY ------

COMPONENTS Cost Volume Cost Volume Cost Volume Total Cost

======------

Plant/DC1: Gamma 4.00 0 4.00 0 4.00 120,390 481,560

Delta 4.00 0 4.00 0 4.00 59,822 239,288

Epsilon 6.00 0 6.00 0 6.00 174,714 1,048,284

CUSTOMER SHIPMENTS

Region 1, Channel 1 ( 27,086 units @ $ 4.00/unit) 108,344

Region 1, Channel 2 ( 33,093 units @ $ 8.00/unit) 264,744

Region 2, Channel 1 ( 10,322 units @ $18.00/unit) 185,796

Region 2, Channel 2 ( 26,812 units @ $28.00/unit) 750,736

Region 3, Channel 1 ( 25,362 units @ $26.00/unit) 659,412

Region 3, Channel 2 ( 32,726 units @ $36.00/unit) 1,178,136

REPLACEMENT PARTS SHIPMENTS TO CUSTOMERS

Region 1, Channel 1 ( 8,261 units @ $ 2.00/unit) 16,522

Region 1, Channel 2 ( 9,352 units @ $ 4.00/unit) 37,408

Region 2, Channel 1 ( 3,923 units @ $ 9.00/unit) 35,307

Region 2, Channel 2 ( 7,777 units @ $14.00/unit) 108,878

Region 3, Channel 1 ( 8,449 units @ $13.00/unit) 109,837

Region 3, Channel 2 ( 6,362 units @ $18.00/unit) 114,516

TOTAL TRANSPORTATION COSTS 5,338,768


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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

OTHER DECISION VARIABLES REPORT, QUARTER 4 PAGE 12

*****************************************************************************

======

INFORMATION TECHNOLOGY

======

Product Cost Report? 0

Replacement Parts Demand Report? 0

Retail Pipeline Report? 0

Service Center Statistics Report? 0


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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

FORECASTING ACCURACY REPORT, QUARTER 4 PAGE 13

*****************************************************************************

Region Forecast Actual Accuracy

------

Product 5-1, Channel 1 1 12,434 13,904 89.4%

Product 5-1, Channel 2 1 21,320 23,939 89.1%

Product 5-1, Channel 1 2 7,748 5,708 64.3%

Product 5-1, Channel 2 2 15,480 17,662 87.6%

Product 5-1, Channel 1 3 13,151 14,779 89.0%

Product 5-1, Channel 2 3 26,213 32,726 80.1%

Product 5-2, Channel 1 1 11,392 13,182 86.4%

Product 5-2, Channel 2 1 10,353 9,154 86.9%

Product 5-2, Channel 1 2 5,080 4,614 89.9%

Product 5-2, Channel 2 2 9,157 9,150 99.9%

Product 5-2, Channel 1 3 12,428 10,583 82.6%

SUMMARY: For 11 forecasts, average forecasting accuracy is 85.9%

Note: Forecasts count within the calculation of forecasting accuracy only

if the "actual" value being forecast is greater than 100 for sales volumes

(to not penalize you for "small" forecasts). Otherwise, the relevant values

of "forecast" and "actual" are only reported for reference purposes, but such

forecasts are not counted for forecasting accuracy scoring. This is the

reason why the number of forecasts referenced in "SUMMARY" may be less than

the detailed line-by-line reporting of forecasts.

Product-Specific Product Product

Forecasting Accuracy Overall 5-1 5-2

------

Forecasting Accuracy 85.9% 83.2% 89.1%

Number of Forecasts 11 6 5

Region-Specific Region Region Region

Forecasting Accuracy Overall 1 2 3

------

Forecasting Accuracy 85.9% 88.0% 85.4% 83.9%

Number of Forecasts 11 4 4 3


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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

FORECASTING ACCURACY REPORT, QUARTER 4 PAGE 14

*****************************************************************************

Quarter Quarter Quarter Quarter

SALES HISTORY 1 2 3 4

------

REGION 1

Product 5-1H, Ch#1 12,434 14,504 14,025 13,904

Product 5-1H, Ch#2 21,320 23,693 23,515 23,939

Product 5-2M, Ch#1 11,392 9,889 12,914 13,182

Product 5-2M, Ch#2 10,353 10,811 10,512 9,154

REGION 2

Product 5-1H, Ch#1 7,748 7,380 9,925 5,708

Product 5-1H, Ch#2 15,480 14,929 16,734 17,662

Product 5-2M, Ch#1 5,080 5,041 5,161 4,614

Product 5-2M, Ch#2 9,157 9,200 9,574 9,150

REGION 3

Product 5-1H, Ch#1 13,151 16,848 17,870 14,779

Product 5-1H, Ch#2 26,213 33,592 31,929 32,726

Product 5-2M, Ch#1 12,428 11,889 9,863 10,583


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FIRM 5: ?????????????????????????????????????????????????? INDUSTRY MAS

SET-TOP BOX INDUSTRY BULLETIN, QUARTER 4 PAGE 15

*****************************************************************************

Welcome to the quarter 4 issue of the Set-Top Box Industry Bulletin.

Notable set-top box industry developments are highlighted in the Bulletin.

INDUSTRY NEWS HEADLINES

Total industry MAS profits were 15,469,776 this quarter.