Like you said, there are a lot of numbers in the press release, which takes a bit of time to digest. I'll call IR tomorrow and ask Lawrie to explain it to me in plain English to make sure I've interpreted everything correctly. Meanwhile, listen to Ted. He's been right on the money in the past and his analysis of this release should be equally accurate.
It looks like MKD is going to issue more shares in a few different stages. They've disclosed everything for the next couple of years so there shouldn't be any surprises. In your earnings model, you can calculate a scenario with full dilution and see if it puts any significant dent in the earnings. If Ted's basic model is correct, the earnings potential is so great that the dilution isn't going to matter much.
Overall, I'm excited to see the confirmation of what we've all been expecting. We're no longer wondering if the CD plant is going to happen. It is and it's coming very soon. Now we can switch our speculation towards production numbers, confirmation of customers (Spinner/CDI, the company in Seattle, and so on) and when production will start. A couple of months ago, MKD was shooting for June, 1998. I think it was last week when MKD went to look at the building where they were putting the plant. I'll have to ask them about the field trip.
As far as promoting the company goes, I understand companies aren't allowed to promote themselves when they're financing. That's why during the past little while, MKD had to be quiet. Rest assured, they're going to promote their company as soon as they can because now they have confirmed substance forthcoming. This is what stockbrokers needed before they recommend MKD stock to their clients. It's an easier sell to say "MKD has a plan to build the first CD plant in Western Canada. They have the funds to build and operate it, and customers to fill the plant capacity already. Oh yeah, and it'll be in production in only a few months from now." I'm going to ask IR over the next little while about their promotion plans. |
