I read this posting on Raging Bull .....
ragingbull.com
REVIEW OF DIXS ANNUAL SHAREHOLDER MEETING. . .
I attended last night's shareholder meeting and thought you might be interested in one
shareholder's view of DIXS and the information that was made public. . . .
The meeting was attended by roughly 30-40 people. After CEO Eric Marchant welcomed the
group, there was an election held for the board of directors. Eric Marchant, Larry Heaps and Curtis
Johnson were all re-elected to the board. These are the only three board members. Eric next
talked about DIXS and the fact that there had been more changes and excitement in the past year
than there had been in the previous five (the company began in April of 1993.) The company audit
will be completed within the next 30 days and DIXS is now completing the paperwork necessary to
becoming a fully reporting company. The audit will be made available on the DIXS website.
The company focus has changed significantly from it's initial business model of listing jobs on CD
rom to now concentrating on combining TV/radio advertisements with it's internet listings to target
qualified applicants for large specific companies. DIXS has identified 32 media markets across the
country that contain 95% of the top 2000 US corporations (the largest revenue producing
companies.) DIXS goes into a market (so far, Salt Lake City, Houston, LA, Dallas) and buys
advertising on TV and radio which directs job seekers to the local web site to register for specific
types of openings. They also hold job fairs or events for the local businesses and try to sell large
companies a "subscription" so that their job openings can be highlighted locally. Subscription
revenue varies by market, the larger areas commanding a higher price. A one-year subscription in
Salt Lake is $35,000, in Houston its $66,000 and LA is $85-100,000. For this price the company
gets several pages for job applicants to review which tell about the specific openings, the
company itself, its benefits, etc. DIXS trains the company on how to update the info and maintain
the site. The result is that large firms have quick and immediate access to more qualified
applicant's resumes. When a job comes up that matches a registered job seeker's skills, the
applicant is sent an e-mail so they can be alerted to the opening. This is a different business
model than monster board, hot jobs, and some of the others. The "reach" of TV and radio is
married with the information capabilities of the internet.
The DIXS organization has changed to include three "divisions" (I'm not sure that is the term the
company uses). Media Buying and Production is the advertising agency arm; Job Database,
Resumes and DRE (directory of recruitment employers) contains the 35-40,000 job listings and
software needed to run the site and assist employers; and TopJobs.net inc is a new joint venture
partnership that I will try to explain.
Some of you may have seen TopJobs.uk.net, a firm headquartered in Manchester, England (name
= The Corporate Net Ltd.) which has a similar business function although not the same model as
DIXS. This is a worldwide company started in 1996 that has tried several times to buy out DIXS so
they can get a foot into the US market (currently they have offices in several countries like
England, Ireland, Australia, etc.) DIXS partnered with this company recently for $1 million in
cash/stock to set up a joint venture so that the two companies can work together to tie up the US
recruitment market as much as possible. The company has been helping DIXS for months to
change it's business model to include TV/radio media reach. The joint venture between the two
firms will sort of take on a life of its own and it will be called TopJobs.net Inc.
51% of the company will be held by The Corporate Net Ltd. and 49% will be held by DIXS. They
will share in both the responsibilities (liabilities) and revenues to these same percentages. This
new company is right now filing the paperwork for an IPO on NASDAQ which is supposed to
happen about the 15th of May 1999. This company in the making will have 3 DIXS board
members, 3 UK board members and 1 neutral. There is already an impressive list of companies
registered and signed up for the recruitment services of this new company like AOL, DELL, AVIS,
BUDGET, COKE, INTEL, MICROSOFT, BBC, SONY, NEC etc, etc. The initial IPO will price at
something above $10/share and I think (not sure) they are talking about 2 Million shares (I could be
wrong on this amount.) DIXS will get 49% of the US revenues of this world wide company which is
estimated to be about 50% of the total world wide activity. DIXS also gets 100% of the advertising
revenue (remember it's media ad arm) in the US which is conveniently funneled exclusively to
DIXS by the new firm.
What does all this mean. This is just my own opinion: I left the meeting wishing I had purchased
many more shares last fall when I bought into DIXS at under 20 cents. If the IPO takes off like
other internet related offerings, DIXS has a lot to gain. Think about it. . . .the IPO prices at $10 and
quickly jumps (maybe the first day) to $40. DIXS gets 49% of the US revenues which are about 1/2
the company revenues; basically, DIXS has 1/4 of the $40 stock (as in $10/share.) Believe me, I'm
not trying to hype this stock, just reporting the things that were made public last night. You will read
about all this in upcoming (if not already released) press releases. Just one other thing. . .
The DIXS guys were very sensitive and concerned about share holder value. They have thought
quite thoroughly about an exit strategy which could come up at any time. They think that either
DIXS or the English firm will buy out the other partner and there are first right of refusal clauses
written up in the joint venture agreements. The guys want to take care of their loyal shareholders,
many of whom are local friends and neighbors. I realize all of this sounds quite fantastic, but there
are a lot of irons in the DIXS fire and sooner or later, the public will recognize the value of the six
years of effort this company has made to carve out its niche. BTW, if you are a Dodger fan, watch
this spring as DIXS appears at the home games to advertize it's program to job seekers and its
recruitment capability to large companies. I hope I haven't misled anyone about what I learned last
night. . . .it will all be unfolded soon in the press. Good luck to all you DIXSers! |
