Wow. ARCI added $1.2M add'l revs from 99Q1, and $600K or so dropped to the bottom line.
Store count was half last year's, but sales were still up 8%, and same store sales up 70%.
Looks like ARCI will be doing $2.5M-3.0M in quarterly retail sales sometime next year, and if recycling holds steady, and they can break even in Q1 and Q4, they may earn $0.50 next year.
According to 10-Q, balance sheet now shows a current ratio of ~1.0, vs a working capital deficit until now...nice improvement.
Also, $3.5M of their long-term debt doesn't come due until 2005, and the lender has a non-voting seat on the board.
The annual report said the new Edison contract gives ARCI more control over advertising, giving ARCI more control over the recycling volumes, and less dependent on Edison.
One times annual revenues going forward is now ~$14M/2.5M shares or so, or $5+ per share (that's a rough number).
ARCI now has over 200,000 cash in the kitty, and may have $500,000 after Q3, or $0.20 per share.
I would expect same store sales to grow at least 50% this Q, and 25% next year, putting ARCI solidly and sustainably back in the black with maybe $1M cash socked away, a stock price heading to $5, and able to issue 200,000 more shares (minimal dilution) and raise another $1M. So, they'd have maybe $2M cash socked away after an offering, and would be generating $1M per year, putting forward cash per share at maybe $1.00 per share.
I'd be scooping a ton now below $1. This looks like LPAC a year ago: bargain price below $1 with tremendous upside potential when they get store count back up to 10 and $20M in annual sales, $0.75 EPS and $7 per share in revenues.
Looks like a 10/20-bagger from here over the next 3-5 years. |
