I got the following from Scott Liolis this evening. He sent out these comments to a few long time stockholders. Since there was no indication that this information was confidential, I will post his note .....
biff
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From: Liolios@PacificGP.com (Scott Liolios)
Reply-to: Liolios@PacificGP.com
Hello,
If you have been a shareholder for over a year I will assume are a fairly happy shareholder. In response to your issues concerning the conference call, I agree with your comment. We had an opportunity to shine and we did not make the most of our opportunity. To some extent the conference calls are a victim of their own success. We had over participation by more than 50 people to bring the total caller # to 248. With that many participants it is impossible to get every body's questions answered.
It just so happens the questions that were asked were very poor questions. They did not give management an opportunity to address the real story. (Still no excuse.) We learned from that call. Because of the size of the conference calls we will be changing the format.
However, the content of what was delivered was excellent. The roll out ratios were great and the agreements expected to be booked over the next 30 days was very useful (I have never seen a company give that much detailed info prior to actually booking it).
But I must disagree with you in regards to the company has been reluctant to promote itself. We have been averaging one investor conference per month, we hold a conference call every quarter, there is approximately 1 press release every 2-3 weeks, we were in Fortune magazine, we had a representative speak toward congress, and we have been on a handful of road shows over the past 9 months. I do not think this represents a company who is reluctant to promote themselves.
As far as the stock price, I realize it is extremely painful to watch the price fall. (Believe me I know it hurts). However, I can assure you that the company has never been in a better position. The company is currently working at full capacity, backlog is bigger than it has ever been, the company implemented price increases, employees are now working overtime, they are hiring 150 new people over the next 90 days, they are currenlty in over 1200 factory floors, they have more cash than the have ever had, they just reported their first profitable quarter since the launch of Plant Y2K One, I&A has been rolling into remeadiation, and there extremely fast growing client list reads like the fortune 500 list.
But because of client companies slow rate to recognize the problem, it has put the company 90 behind Hannifin's model. I ask you, would you of bought the stock 90 days ago? Did the fundementals seem compelling then? The price is less and the company has more.
The new Hannifin report carries almost no consideration for the medical or utility market. It contains no consideration for the Preferred Solution Providers (PSP). This is all upside to the model. But still his new model estimates $1.10/ share for fiscal year ending June 1999. (13 months away.) The stock is trading at less than 10 times that number. You should try to compare that multiple to the other System Integration & Y2K companies.
But what I find most impressive is that in the middle of building the incredible growth story in year 2000 solutions, management has been forward looking enough to implement a core integration division to leverage the Y2K opportunity 19 months in advance. While most of the other Y2K companies are fighting forY2K business, TAVA has more business than the can handle (with their current employee count), and have key employees in place for TAVA Consulting. TAVA is already the nations largest independent control system integrator and year 2000 problems represent an opportunity to become the world's most dominant player in factory automation. Not a bad place to be.
So although I know sometimes we can lose site of why we invested in TAVA, it is important to remember how much Jenkins and company has accomplished in a extremely short time.
Quite frankly, I have never seen another story like it. So if you feel so compelled, please hang in there. But for now, my money is on TAVA Technology.
Thanks for your support.
Scott Liolios
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In a message dated 98-05-20 21:58:29 EDT, you write:
<< Quite frankly, I have never seen another story like it. So if you feel so compelled, please hang in there. But for now, my money is on TAVA Technology. >>
Scott, thanks so much for your message. I will spread the word from my end. I've still retained a large portion of my TAVA holdings, and look forward to better days shortly.
I know you (and the company) do not believe in micro-managing the stock price, but I do recall the day before the BMY press release came out, the stock had tanked to 4 15/16.
That one press release turned TAVA around and helped increase its market cap to the point where it now considers itself to be an acquirer of other businesses.
So, if you happen to have one ready for release, perhaps it would have a similar effect. We need all the help we can get right now!
In any event, best of luck to you, us and the company in the next few weeks. Hope you're real busy and productive with all the road shows to come.
Sincerely,
David M. Pincus |
