With the permission for reproduction by Mariposa by Ian Fletcher:
Where will you be on January 1 2000 just after midnight?
Actually at the time you may not care. If you are trying to get into a "secure" building or are on an elevator you may be in for a big surprise if the "smart" building is not Year 2000 compliant. Even if you are safely inside you may find that your heating, ventilation, and air conditioning (HVAC) system does not function properly, if at all, and so on for all the other devices that are run by a computer.
Right now a quiet revolution in systems integration is in
progress that most people do not know about. Systems integration is the logical next step in "smart" buildings, be they homes, office towers, factories even nuclear power stations. As the name implies the concept is melding all the different security and automation features in "smart" buildings into a whole. This revolution is occurring on a number of fronts and has a number of ramifications.
Suppose that you are a building manager and your building has a security and an automation system. When faced with the coming year 2000 problem there are two ways to go, patch up the old system which will need expensive customized hardware and software and will leave you with a somewhat dated, albeit functional system in place, or retrofit the ALYA Open System which gives you year 2000 compliance and more. Open Systems is the technology that allows products from different manufacturers to be inter-operable and is now being adopted by leading edge companies.
The advantages of going with the ALYA solution are manifold.
This system allows all the disparate elements of a "smart" building to
function as one entity, or team, that does not have to rely on a central computer.
There is no need for expensive customized hardware and software, the system is also very easy to add-on to for future control or expansion.
The key to this system is a neuron chip developed by Echelon.
Echelon is a company formed by Mark Markula (one of the founders of
Apple Computers), Motorola, Toshiba, the Quantum Fund and George Soros. ALYA products can be seen on the Echelon web site at www.echelon.com. Each device in the system has a neuron chip imbedded in it. Each neuron chip is actually three 8-bit inline processors in one. Two are optimized for executing the protocol, leaving the third for the node's application. This ensures that the complexity of the
application does not negatively impact network responsiveness and vice
versa. The neurons are inter-connected by a simple two wire system,
creating the entity. Because of the simplicity of the wiring, retrofitting rarely involves any wirepulling which can be a costly process.
Echelon also had a major influence in forming the LONMARK
Association, other members of note are Honeywell, Johnson Controls, and Olivetti to name a few. The Association sets standards for communication involving the neuron chips and the devices that they are imbedded in, thus providing a universal language for these devices to use in a Local Operating Network(LONWorks), such as a building. Another chip component interacts with other networks such as LAN(local area network) and WAN(wide area network) as well as internet protocols. This makes it possible for a world wide system
where, if necessary a simple computer command from North America could
turn on a light/device in an associated office in Europe.
ALYA adopted the LonWorks technology early in it's development, inspired in part by Bill Gates book, "The Road Ahead".
As an aside Bill has come a long way since the time when, as a
child he used to delight in smashing bumper cars into other cars driven by adults at the fun park. This may help to explain his latest collision with the establishment.
Back to the issue.
ALYA took the LonWorks open architecture technology and the Microsoft Windows NT/95 operating system and created the OpenCortex system, an adaptable control platform comprised of one communications and control system that allows interoperability among the end use devices.
OpenCentrix was the next step, designed with a mind to provide
an easy retrofit it ties in the security functions, including card readers that conform to this new technology. ALYA and Motorola/Indala have signed a joint agreement to develop the card readers that conform to this system.
The hardware for the ALYA system consists of three circuit
boards; the access control manager, the entry point controller, and the input/output board. These boards are easy to retrofit into existing panels and can continue to function even if the main computers are down. The Insurance Corporation Of British Columbia have recently upgraded their buildings using Motorola Indala Corporation and ALYA technology. ALYA was written up in the December 1997 issue of Security Investing magazine as the security micro cap of the month.
Behind the meter is an expression that is becoming commonplace
in the deregulated utility industry, it has sprung up because the old ways of doing business are changing. Utility companies with vision are seeking out companies like ALYA and Motorola/Indala in order to get behind the meter and monitor/manage energy flow within buildings. This requires detailed information from all the devices connected to the system as well as the ability to fine tune each device individually. This is exactly what ALYA's system allows them to do. As a case in point consider a heating/cooling duct in an individual office, there is no point having it open if there is no one in the office. When the person logs in/out with the security card the system automatically opens/closes the vent, thereby generating overall energy savings. The same goes for individual lighting, a big energy drain in large
buildings and so on.
Utility companies now offer this behind the meter management
which is a huge market. This is helping companies to save money on their energy costs and is generating extra revenue for the utility companies in management fees. Of course in a Mariposa favorite theme this ultimately benefits the environment in terms of less energy usage and consequently less greenhouse gases etc.
Because of the proximity of the Canadian offices, I did visit
them last week and met with Milan Carnogursky, President and CEO, Douglas Corbett, North American Marketing and Sales Manager, and Roger Mutimer C.A. CFO and as usual would like to thank them for the time that they spent with me. I was shown how the system works and we talked about some of the companies immediate objectives, Mr. Mutimer explained the finances and how the share structure is set up. In all I spent about three and a half hours there and came away with a very good impression, otherwise I would not be writing this now. I think that I would describe the company as a hockey team, let's say Detroit, that has it's eyes on the Stanley Cup. A team that is a good blend of management, coaching and player experience fueled with the energy and innovative powers of youth. I believe that the company is very well connected on a personal basis with strategic people in the industry and because of the relationship with Motorola/Indala and Echelon
well connected on a corporate level as well.
ALYA participated in the LonUsers International Spring '98
Conference & Exhibition being held May 20-21, 1998, in Santa Clara,
California. Keynote presentations by the Utility/Energy, Transportation, Semiconductor and the Building Automation Industries will review the penetration of LonWorks products. The LonWorks solution provides the technology platform helping to deliver new products and services being implemented in the Utility industry because of de-regulation. LonWorks based fiber optic control solutions for automating complex control systems are reducing costs in transportation and communication. Every aspect of building
automation design and integration is undergoing fundamental change due
to the ability of LonWorks technology to cost-effectively integrate
commercial control processes.
Finally, considering the product/system has not been
commercially available until January this year, Alya has gone quite far in growing to gain market share through setting up global distributorship/sales arrangements, there are many developments in train for the company in the near term and it will be interesting to see how the company meets and responds to the challenges of the international market-place.
Distributorship Agreements
North America
M&E Sales Inc. - Systems integration company based in Baltimore,
Maryland.
Projected initial sales of $500,000.
Smart Building Technologies - Telecommunications based company which
provides communication infrastructure based in Richmond, British
Columbia. Projected initial sales of $500,000
Facility Robotics - Automation and systems integrator in
Atlanta,Georgia.
Projected initial sales of $500,000.
Europe
PVT a.s. - Network services company provided by private data network in Slovak and Czech Republics. Projected initial sales of $375,000.
TA Control Systems NV - One of Benelux's leading building management
systems companies in Belgium, Holland and Denmark. Projected initial
sales of $250,000.
Corinex Group a.s. - Network and building system integrator in Slovak
and Czech Republics. Projected initial sales of $880,000.
Ing. K. Simonsen A/S - Automation system company in Norway, Sweden and
Finland. Projected initial sales of $400,000.
South America:
Codas Electronica S.A. - Motorola Indala distributor and representative for Mercosur countries (Argentina, Brazil, Chile, Uruguay and Paraguay). No number confirmed .
Training classes have been held for:
M&E Sales, Wright & Runstad, TA Control System, Corinex, Simonsen, PVT, SPP, C&K Sales, MacDonald Miller, Facility Robotics, Los Alamos and others.
Share Structure and accounting policies
Common Shares
Management 5,279,000
Employees 535,330
Outsiders 7,618,552
Total Outstanding 13,432,882
Less: Restricted 10,150,159
Float 3,282,333
Preferred Shares
Outsiders 400,000
No market exists for preferred shares
Potential Dilutions
1. Warrants
Issued:345,032 warrants to outsiders, exercisable at $2.00, expire
August - October 1999. Unlikely to be exercised until stock has traded above $2.00.
2. Stock Options
Grants: 1997 Management 87,500
Employees 22,500
Total 110,000
1998 Management 174,000
Employees 248,000
Total 422,000
1998 Outsiders 255,000
Total Grants 787,000
At this point, no options have been exercised. Potential
dilution is limited in the short term as there are restrictions on the exercising of all but 155,000 of the options.
The company has audited statements for September 30, 1997 from
commencement of its business and will do the same for 1998, a refreshing change from most OTC BB companies and one which may have positive implications for the future.
Management
Milan Carnogursky, President, CEO has 20 years international,
multifaceted business experience. He has founded many new start-up companies in different parts of the globe ranging from an Oil & Gas Engineering Company with 215 employees and l00 million annual sales to a small Manufacturing Plant in the Far East of Russia. His business transactions are conducted in many countries of the world, including Japan, Korea, Chile, Russia and Europe, an ideal network within the Global Market Place. In l987, Milan led a successful unaided dog team expedition to the magnetic north pole.
Jaro Bucko, VP Technology, and Director: l8 years of extensive
experience in computer industry as electronics engineer, programmer and real-time computer systems developer. Led a number of major projects developing client/server systems for the Building Access & Security and Industrial Process Control industries that have been installed in hundreds of sites across the world. During l989-l995 was chief Design Engineer for Computrol Security Systems LTD (CSS), a leading developer and manufacturer of advanced integrated security systems.
Vladimir Kostka, European Business Development Manager: Eight years
extensive and varied business experience. From l994-l995 was Vice
President of Trade and Finance for NAFTA Slovak Oil & Gas Corp., a company of 2,700 employees of which 250 were under his direction. Has founded companies with sales of goods ranging from software & hardware products (l5 million annually) to food processing equipment (l.5 million annually). He has researched and established customer contacts throughout Europe and Russia.
Douglas Corbett, North American, Marketing and Sales Manager: l2 years of experience as Sales Manager for CSS. Eight years additional experience as Service Manager for National 3rd Party Technical Service Company, DataTech Systems. He has extensive industry management and sales background including recent sales of major security management systems to the City of Calgary, City of Mississauga and Vancouver International Airport.
Gerry Gabel, The latest member of the management team, formerly with the Echelon Corporation, Mr. Gabel joined ALYA in May 1998. As a director, Mr. Gabel's mission is to use his years of very successful sales and management experience and his multiple contacts in the building automation industry to build a network of resellers across the United States.
Mr. Gabel brings to ALYA 22 years of experience in sales and
management in the high tech industry. He has been with Echelon since
1991. Mr. Gabel's previous sales and management positions were with the Exabyte Corporation Pixar and Data General where he accomplished the following:
Echelon Consistent revenue increases since 1991. Penetrated 15
"Fortune 500" companies as Strategic Accounts Manager;
Exabyte Corp. Responsible for $23 million in revenue as National
Distribution Sales Manager;
Pixar Increased profitability by 17%. And managed
relationships with Sun Microsystems, Silicon Graphics,
Digital Equipment Corporation [NYSE:DEC - news] and IBM.
Data General Sold over $25 million in Data General equipment.
"Salesman of the Year" in 1984.
Technical chart indications,
Since September there has been an obvious increase in volume and a tightening of the spread, this coincides with the year end and the audit of the books which may or may not be significant. Then in February the major shakeout that preceeded a burst of volume and a move back to the .65 level, back down to .50 and a sustained move to the plus 1.10 level where it has found support. I think that the downside risk is minimal compared to the upside potential.
DISCLAIMER PLEASE READ
The information in the News Packet is from sources BELIEVED to be reliable, and hence may NOT be correct. This is NOT investment advice. I am not a broker. Consult a REPUTABLE broker before buying any security, especially one mentioned on the internet. Try to find your own stocks. We select most of our stocks because of some technical significance, then look at the company. We do NOT buy stocks because someone wants to sell them to us. We are completely independent. AT THIS TIME we do not accept money from the companies written about any EXCEPTIONS to this should they occurr will
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the basis for the News Packet is ABSOLUTELY PRIVATE, it will not be given out to any other person. When a stock is written up as having some technical significance, we MAY BE WRONG in our opinion. The stock may do the OPPOSITE of what might be expected. If I have a POSITION in any stock mentioned, I will divulge it at the time of writing. If so disclosed, I may SELL at any time. NO ONE else is privy to any information about any stock that is written about until the list has gone out, unless noted. This is VERY IMPORTANT TO ME, as it is a matter of my PERSONAL INTEGRITY and what I consider my responsibility to my readers. We refers to "GUS", my yellow labrador and myself. The goal is to educate, entertain and enlighten our readers. While there is no charge for the News Packet at this time, there will be for 1999. Past performance is not indicative of future success. Be very careful of, or don't, place premarket, market buy or sell orders. Be careful about placing market orders when the market is open. Always LIMIT
YOUR LOSSES with a mental stop loss. NEVER change your mind on your stop loss. DO NOT speculate with money that you CANNOT AFFORD TO LOSE, that will lead to stress which can affect your personality and impact those most close to you, in particular your family. If you miss a stock do not chase it there are plenty more opportunities coming up.
All the best, Ian Fletcher. |
