DCH Technology Inc. -
Company Profile
DCH Technology Inc. DCHT
Shares issued 0 1899-12-30 close $0
Tuesday Jan 19 1999
DCH TECHNOLOGY, INC. ("DCHT" on OTC - BB)
27811 Avenue Hopkins Suite 6
Valencia, California 91355
Phone: (805) 775 - 8120 * Fax: (805) 257 - 9398
IR Dept. (805) 775 - 8120 ext. 11
Website: dcht.com
IR Email mailto:DCHTinvest@aol.com
Jan 15, 1999
DCHT is a leader in the development and production of state-of-the-art environmental monitoring and safety-engineering products for hydrogen industrial uses.
DCHT has licensed and developed a universal gas detector and has recently begun selling state-of-the-art hydrogen gas sensors, targeting a potential US$2 billion market.
DCH Technology is on the verge of commercial development of PEM Fuel Cells - a product that will revolutionize power production and transportation in the 21st century.
THE COMPANY
DCH Technology, Inc. ("DCHT") is a firm that specializes in licensing and converting new ideas and technologies into state-of-the-art products.
DCH's gas sensor products are aimed at a worldwide market with potential sales estimated at US$2 billion per year. DCH Technology's flagship product is the "Robust Hydrogen Sensor" (currently in production), and is aimed at an estimated US$200 million market. DCHT's product line has been demonstrated by independent testing labs to consistently and significantly outperform its competitors products.
DCH's proprietary Thick Film Hydrogen Sensor Technology developed at the National Renewable Energy Laboratory was recently judged to have an excellent chance for success, from the US Department of Energy Hydrogen Program R&D Program Technical Peer Review, On Oct. 26, 1998 (see press release).
DCH is strategically positioned at a time when a variety of new markets are emerging for the use of hydrogen fuel. DCHT's commercial application of proprietary technologies contributes to the safety and implementation of environmentally friendly energy technologies.
BACKGROUND
Hydrogen is explosive when it reaches just 4% concentration in air. Because so little amount of gas is needed for combustion to occur, monitoring and measuring the gas in order to activate safety control equipment or to sound an alarm is vital to avoid hazardous situations. Process monitoring based on fast and accurate measurement is also important to many process industries such as; petro chemical, energy, medical, waste management, environmental, manufacturing, food, military and space.
Some current DCH customers include NASA, Ford, Westinghouse, Allied Signal, General Motors, Lockheed Martin Defense Systems, The US Naval Medical Research Institute, and a number of other internationally-known aerospace, automotive, nuclear and defense industry clients.
DCH has teamed with Westinghouse and the European Bank of Reconstruction and Development to retrofit the Leningrad nuclear reactor with DCH sensors and has already begun delivery on November 2, 1998. (see press release). DCH is in discussion with Westinghouse to team on safety upgrades to nuclear facilities throughout the world. There are between 275 and 350 nuclear power plants worldwide.
DCH is also leading the Maritime Hydrogen Technology Development Group, which plans to retrofit a ferry in Hawaii with hydrogen power as a testing and demonstration platform. DCH's partners in the MHTDG include Pacific Marine, Allied Signal, Northrop Grumman, LANL, Thiokol, HBT and the Desert Research Institute. Risk management will be provided by Renewable Energies Group, (REG), which is a joint venture between DCH, the National Hydrogen Association, and Rode and Associates. (Ins.)
Additional sources of vast untapped revenue potential are the power transformer and semiconductor industries. Power distribution transformers are found on hydro poles and industrial facilities across the country. During operation, hydrogen is naturally generated in the transformer cooling oil. Elevated levels of hydrogen in the oil indicate a malfunction and/or an imminent failure. The DCH sensor will allow monitoring of these hydrogen buildups and signal maintenance crews to repair the problem before the transformer fails or explodes. DCH anticipates this to be a source of tremendous profit.
In semiconductors, when large quantities of hydrogen are accumulated in semiconductor manufacturing plants, much of it is burned off in furnaces. A sensor is needed to monitor the hydrogen accumulation in these burners. Only the DCH sensor is robust enough to handle this harsh environment. DCH estimates this and related process monitoring applications could potentially generate sales of $18,000,000 annually.
Building upon its own hydrogen gas sensor product line, DCH Technology has licensed the "Universal Gas Detector Technology" from Simon Fraser University. This new, state-of-the-art technology, significantly improves the sensing capability of existing gas detectors, and, with the planned introduction of new products, will open up much of the US$ 2 billion gas detection market to DCHT.
Started as an engineering safety and gas detection and sensor manufacturing company, DCHT is now teamed with the US Dept. of Energy and the Los Alamos National Lab to commercialize a small hydrogen fuel cell capable of generating from 50 watts to 500 watts, or more, of portable electrical power. DCH Technology believes that this product could be available for worldwide distribution and sales sometime in mid 1999. DCH Chief Scientist on the project is Mark Daugherty, Ph.D., a former LANL scientist and a recognized expert in the field of energy and hydrogen utilization technologies. Dr. Daugherty actively coordinates Cooperative Research and Development Agreements between DCH and the US Dept. of Energy.
Information regarding DCH Technology's stellar management teams and Board of Directors and details on DCH's product line and news can be viewed at dcht.com.
SHARE STRUCTURE & TRADING PRICES
Shares Issued: 11 million (fully diluted)
Float: 3.4 million
Restricted: 7.6 million
52-week high: 8-1/4
52-week low: 3/16
Current bid/ask: 13/16 by 31/32 Last Trade: 31/32
Included in the 7.6 million restricted shares are 5.4 million shares held by officers, directors and insiders.
HYDROGEN-POWERED FUEL CELLS
A fuel cell is a device that uses a fuel (typically hydrogen, although methane or natural gas can also be used) to create electricity. Hydrogen is the most abundant element in the universe; it is also one of the most energy-efficient fuels available.
Hydrogen is introduced into one side of a fuel cell; the hydrogen atom is stripped of the electron as it passes through the cell, and the electron goes through a conductor to create an electrical current. At the other end, the hydrogen atom joins up with oxygen and forms water. So, when you use a fuel cell, you create clean electric power with pure water as the only by product.
Today, when investors think of fuel cells, they tend to think of Ballard Power Systems, and their R&D work in developing fuel cells to power electric vehicles.
COMPARISON WITH BALLARD POWER SYSTEMS, INC.
There are a number of interesting comparisons that can be made between DCHT and Ballard Power Systems, a company developing fuel cell power technology primarily for large stationary power systems and secondarily for many of the world's leading car and truck manufacturers. In 1997 Ballard (BLDPF) was trading at $6.00 per share. In 1998, shares of Ballard Power soared from $10 to $188 (prior to a 3-for-1 stock split) on the Nasdaq and Toronto Stock Exchanges. Ballard Power's market cap and share price levels are attributable to investor excitement about the company following the announcement of a strategic alliance between Ballard Power and Daimler-Benz and Ford. (Both Ford and GM are DCH customers).
DCHT has its own impressive list of strategic partners from the most prestigious US National Laboratories, to five of the top ten United States Aerospace and Defense Companies. Its latest advances in the areas of fuel cell technology and remote hydrogen sensor applications are propelling this company to the forefront of a rapidly growing industry.
The environmental regulatory climate (re: vehicle and power plant emissions) is one element that is driving the success of both companies. DCH Technology and Ballard Power, as well as several other companies are working towards developing commercially viable sources of zero-emission electrical power.
DCHT believes that the transportation sector is not the fastest arena where fuel cells will be brought to market. Smaller, portable fuel cells will be brought into commercial development far sooner than the larger units being developed to power electric vehicles and homes. In fact, DCHT sees a near-limitless market for small, portable fuel cells to provide "portable" electric power for the recharging of batteries and small consumer appliances; cell phones, laptops; virtually any low power need.
The DCH PEM fuel cell is just months away from commercial introduction, and its potential market is probably equal if not greater in size to that of Ballard Power's larger, vehicle-oriented fuel cells. DCH Technology will be showcasing its economically viable prototype of the PEM fuel cell at the 10th Annual National Hydrogen Association Meeting in April 1999 in Tyson's Corner Virginia. ttcorp.com.
However, the most important factors when comparing DCHT and Ballard Power is the size of the available markets for their respective products, and how soon each firm's products could realistically be in commercial production.
Another significant difference in the companies is in regards to structure and the amount of "paper out there". DCHT has about 3.4 million shares in the active float as opposed to tens of millions for Ballard Power. Ballard has a market cap of approximately US$ 2.1 billion (based on 81 million shares currently outstanding at US$ 27 per share), whereas DCH Technology's market cap is just US$11 million.
Very few investors know about DCHT, and the DCH Technology story is only just now coming to the attention of major market players, analysts and newsletter writers. Could DCHT be another Ballard Power in the making? We think so!
CONCLUSION
WE BELIEVE THAT DCHT REPRESENTS A GROUND-FLOOR OPPORTUNITY FOR AGGRESSIVE INVESTORS (WITH TREMENDOUS UPSIDE POTENTIAL)
DCH Technology, Inc. has all of the classic ingredients for major success: excellent technical management, world class strategic alliances, diverse products, and their proprietary fuel cell that will be unveiled April 7. DCH has exclusive worldwide manufacturing and distribution rights to the PEM fuel cell, which could be a multi billion-dollar industry in the next decade. Consequently DCHT is rated as a major long term buy.
* From a technical standpoint we believe that DCHT has formed a solid base in the US$1.00 range during the fourth quarter of 1998, and is on the verge of breaking out of its recent trading range. We see solid investor support (and accumulation) at current levels. Currently the company is trading at about US$0.97 cents per share.
With increased market and investor awareness, it seems reasonable to expect that DCHT's shares will be valued at much higher P/E multiples than is presently the case (15 to 20 versus the current 1 to 2).
For more information, please contact
DCHT Investor Relations -
Phone: (805) 775 - 8120 ext. 11
mailto:DCHTinvest@aol.com
Disclaimer
RESEARCH INVESTMENT GROUP is not a Registered Investment Advisor or a Broker / Dealer. This communication (print or electronic) reflects opinions about DCH Technology, Inc. Readers are advised that this electronic publication is issued solely for information purposes and is not to be construed as an offer to sell or the solicitation of an offer to buy.
The opinions and analysis included herein are based on sources believed to be reliable and in good faith but no representation or warranty, expressed or implied, is made as to their accuracy, completeness or correctness. This information is not intended to be used as the sole basis of any investment decisions, nor should it be construed as advice designed to meet the investment needs of any particular investor. The foregoing discussion contains forward-looking statements, which are based on current expectations and differences can be expected. The information contained herein has been obtained from publicly available sources and disseminated by RESEARCH INVESTMENT GROUP for information purposes only. In addition, the information contained in this report is not intended to be a complete discussion of information regarding some of the current and/or intended business activities of the Company.
Readers are urged to consult with independent financial advisors with respect to an investment in the shares mentioned herein. Investors should review a complete information package on DCH Technology, Inc. (the "Company"), which should include, but not be limited to, the Company's annual report, quarterly report, press releases, as well as all regulatory filings. DCHT expects to become a reporting company in 1Q 1999. All information contained in this report should be independently verified with the Company mentioned herein. Any opinions expressed in this report are statements of judgment as of the date of publication and are subject to change without further notice, and may not necessarily be reprinted in future publications or elsewhere. Neither RESEARCH INVESTMENT GROUP nor its officers, directors, partners or employees / consultants accept any liability whatsoever for any direct or consequential loss arising from any use of this report or its contents.
RESEARCH INVESTMENT GROUP has received a retainer fee of 50,000 free-trading common shares of DCHT from RAM Capital Management, an independent consultant to DCHT. RAM has paid for consulting services including, but not limited to this research report and its dissemination, project analysis, assistance in locating funding sources as well as evaluating and reporting on projects the Company may have acquired or seek to acquire in the future. Prior to RESEARCH INVESTMENT GROUP disseminating this information, RAM has reviewed the contents hereof.
RESEARCH INVESTMENT GROUP, its officers, directors, partners, employees and consultants may profit in the event the shares of the Company increase in value. These positions may be liquidated from time to time even after RESEARCH INVESTMENT GROUP, its officers, directors, partners and employees consultants have made positive comments on the Company.
THE READER SHOULD VERIFY ALL CLAIMS AND DO THEIR OWN DUE DILIGENCE BEFORE INVESTING IN ANY SECURITIES MENTIONED. INVESTING IN SECURITIES IS SPECULATIVE AND CARRIES A HIGH DEGREE OF RISK.
We encourage the reader to review the investing information available with the Securities and Exchange Commission ("SEC") at sec.gov sec.gov and / or the National Association of Securities Dealers ("NASD") at nasdr.com.
Readers will be able to review the companies annual report on its web site sometime after Jan 22, 1999. As DCH is not yet a reporting company, public filings are not available from the SEC's EDGAR page. The NASD has published information on how to invest carefully at its website.
(c) Copyright 1999 Canjex Publishing Ltd. canada-stockwatch.com
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