TLOS, anyone got any info on this one?
you ask and shall now receive:
TECHNOLOGY LOGISTICS SYSTEMS
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(OTCBB: TLOS)
PRICE: 5/8 - 43/64
Shares Outstanding: 12,500,000
Approximate Public Float: 2,600,000
THE COMPANY
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Technology Logistics Systems (OTCBB: TLOS) located in Santa Clara,
California in the area known as Silicon Valley, specializes in
management of master warehousing, design and implementation of product
exchange and return programs and operations of remote depot locations.
Technology Logistics Systems focuses on providing service to the
high-tech companies in Silicon Valley and services Fortune 500
clients.
Technology Logistics Systems handles 24-hours deadline deliveries from
over 80 national and international emergency parts depots, as fast as
an hour from call to door. Over the years, TLOS has earned an enviable
reputation for providing quality logistics service at reasonable
prices. Because of its dedication to quality, TLOS has attracted
several Fortune 500 companies as customers including Cisco Systems,
Octel, and Lucent. Technology Logistic Systems has managed depot
programs for a major computer mainframe manufacturer; a world leader
in copy products and a leading computer workstation manufacturer.
INDUSTRY OVERVIEW
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According to Forrester Research, business-to-business commerce in the
U.S generated $43 billion in revenues last year compared to the
consumer side's $8 billion. Forrester also estimates that U.S.
business-to-consumer revenues will grow to $108 billion, while
business-to-business revenues will skyrocket to $1.3 trillion in 2003.
The logistics support market is estimated at $4 Billion annually.
Customer demand for Technology Logistics Systems services is high and
continues to grow primarily because these companies, and companies
like them throughout the US, see value in outsourcing logistics
functions to reduce cost and to remain competitive in their business
segment.
MANAGEMENT
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Mr. Ben Scrimizzi, an experienced executive and logistician, is the
President and Chief Executive Officer of TLOS. Over the past three
years he has successfully marketed TLOS to a variety of customers with
whom hehas developed good rapport which, in turn, has led to the
Company's growth.
Under Mr. Scrimizzi's leadership, TLOS has reinvested its profits to
finance additional facilities and equipment to meet the growth in
customer demand.
TLOS has roughly 20 employees. In an effort to keep costs low, the
Company tends to avoid building warehouses or purchasing expensive
equipment, preferring instead to act as a one-stop broker of logistics
services between services suppliers and TLOS clients.
FINANCIAL INFORMATION
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TLOS is steadily growing their business. The company increased
revenues over 100% from 1996 to 1998. In that time, TLOS grew from one
location to four. In 1999, the Company expects revenues of $6.5
million with a net income of $600,000 or 9% of revenues. In the year
2000, the Company projects revenues of $12.2 million with net income
of $1.6 million. This translates into company-projected earnings per
share of $.04 in 1999 and $.14 in 2000.
The demand for high quality logistics support companies currently
outstrips supply and is expected to continue to do so for the next
several years.
Most Technology Logistics contracts are with Fortune 500 companies.
TLOS is experiencing growth under these contracts, which are expected
to expand further as these clients gain experience with the company.
TLOS is currently in negotiations to substantially increase the value
and profitability of other existing contracts. Additional growth is
expected from new contracts as other Silicon Valley companies become
aware of TLOS services. Finally, Technology Logistics Systems achieves
good levels of profitability by using cost-plus contracts. In
addition, most TLOS contracts renew annually, thus providing long-term
revenue stability.
OPERATIONS
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Customer demand for logistics services is high and is growing as
manufacturing companies see value in outsourcing logistics to reduce
cost and to remain competitive in their industry sector.
With today's competitive transportation rates at their lowest level in
years, the real opportunity for substantial dollar savings exists in
planning what parts to buy, how many, and where to position them. By
historical analysis of parts usage, emergency parts requirements, and
"just in time" supply chain procurement, Technology Logistics Systems
will buy only to installed base needs and deliver to customer
commitment standards.
Technology Logistics Systems helps companies streamline operations by
supplying logistics of daily material management and distribution.
They also offer systems design and site development plans, and
recommend parts purchase and inventory levels. Finally, the company
provides personnel for on-site management to control the complete
process flow.
Most Technology Logistics Systems contracts are with Fortune 500
companies. Technology Logistics Systems is experiencing growth under
these contracts, which are expected to expand further as these clients
gain experience with Technology Logistics Systems.
AFFILIATES
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TLOS is affiliated with multibillion-dollar logistics companies
worldwide, including:
Nedlloyd of Europe- A $3.0 Billion organization with a funny name (two
guys in business together?) currently servicing several Technology
Logistics Systems customers and co-soliciting several additional
accounts including Cisco Systems, Teledex, On-Command Corporation, and
Accel Graphics.
S.T. Logistics of Singapore - A division of $7.0 Billion Singapore
Technologies. S.T. Logistics offers bonded facilities, government
services, multilingual customer service, on site express delivery,
technical services, and warehousing and distribution. S.T. Logistics
currently services Quantum for Technology Logistic Systems. Several
other customer protects are under review including Teledex, Cymer, and
GaSonics.
Airocean Logistics of Singapore - A $2.5 Million locally owned air
forwarding, ocean forwarding, customer brokerage, and logistics
organization currently handling Technology Logistics Systems
Operations in Metro Singapore.
Chun-Ahn Logistics of Korea - A $3.0 Million transportation, trucking,
customer brokerage, logistics organization located throughout South
Korea. Chun-Ahn currently handles three accounts for Technology
Logistics Systems: Cymer, GaSonics, and Mattson Technology.
Fuji Xerox Distribution - A chip off the $4.0 Billion Japanese block
Fuji Xerox, Fuji Xerox Distribution is the largest warehousing,
distribution, logistics, and express delivery entity in Japan: it
currently handles operations for Technology Logistics Systems in Tokyo
for Cymer and Cisco Systems. Technology Logistics Systems plans to
start a pilot program with Fuji Xerox Distribution this month.
We could go on and on about other clients and affiliates like A.G.
Associates, Cymer, Inc., Gasonics International, Mattson Technologies,
Lucent Technologies, Octel Communications, On Command Corporation and
the Teledex Corporation…but we're sure you get the picture.
SUMMARY
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The most important thing to look at when evaluating a potential
investment is market size. Early stage companies like TLOS have a
higher degree of risk and a larger market obviously makes for a higher
potential return on investment. The logistics support market is
estimated at $4 billion annually. Adequate, no?
Industry entry barriers are high in terms of access to distribution
channels. TLOS has a network of over 80 national and international
emergency part depots. We believe that a “new kid on the block” may
find it impossible to set up a network that compares with the TLOS
breadth and depth.
The TLOS solution saves money. Companies in the $100-$300 million
range don't have the capital to invest in supply chain logistics, but
TLOS has the experience and the technology to create a customized
solution for its clients, choosing the most appropriate suppliers from
their range of international services vendors. TLOS even counts Cisco
Systems and Lucent Technologies among its customers.
TLOS solutions are important to the quality of the buyer's services.
When Cisco Systems provides support to its customers, it can track a
part anywhere in the shipping process with TLOS as the outsourced
logistics provider. This is key is maintaining the all-important “we'
re on top of the customer service situation” image.
Finally, TLOS is the first to market with a real-time tracking
solution. We're all aware of the importance of being first to market
in the Internet industry.
CONCLUSION
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Technology Logistics Systems develops and is responsible for complete
material planning and inventory management for its customers.
Substantial future growth is expected from these accounts as
Technology Logistics Systems continues to establish itself as the
logistics vendor of choice.
Technology Logistics Systems is assisted worldwide with affiliates
that include Nedlloyd, S.T. Logistics, Fuji Xerox Logistics, Chun Ahn
Logistics and Europa.
Technology Logistics Systems has grown substantially over the last
three years with revenues increasing from 1996 to 1998. The demand for
high quality logistics support companies currently outstrips supply
and is expected to continue to do so for the next several years.
Revenues have increased over from 1996 to 1998 going $1.4 Million to
$2.5 Million. Projections for 1999 and 2000 revenues are $5 million
and $11 million, respectively.
We feel that this is a moderate to low risk for value investors
looking for a medium to long-term play in a “first-to-market” company
in an inevitable Internet niche.
For more information about TLOS, please subscribe to the TLOS mailing
list by sending an email to:
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