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Gold/Mining/Energy : American Eco (ECGOF, ECX on Toronto exchange)
ECX 1.8000.0%Dec 19 3:59 PM EST
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To: Peter H. Mack who wrote (2239)3/24/1998 5:13:00 PM
From: Peter H. Mack  Read Replies (2) of 2841
 
To all:
From the 10k, ECO breaks up operations into three profit centers:

Revenue
1. Industrial Support $147.4 66.9%
2. Environmental services $ 12.1 5.5%
3. Specialty Fabrication services $ 60.9 27.7%

Expense % of revenue
1. Industrial Support $135.7 92.8%
2. Environmental services $ 13.6 111.9%
3. Specialty Fabrication services $ 50.3 82.5%

Total expense was $201,214 91.2% leaving 8.8% net.

The point is that 70% of the business provides the lowest net (7.2%)
And earnings before taxes is 8.8% of revenue.

IF we do as well next year on roughly $255 mil revenue (245 + 9.7mil), earnings at 8.8% would leave $22.44 mil. On 19.4 mil shares, this leaves $1.15 before taxes or about $1.03 taxed on basic shares.

Since margins are tight, expanding revenue by acquisition will only work if the margins are good enough. Apparently the streets concern was that DBCO margins might be too low.

Regards
pete

PS.. how do you get columns of numbers with this editor??
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