Still digging. My initial thought was this is a holding company so going for diversity and picking up what appears to be a profitable business. Another PR announcing letter of intent to acquire another company coming soon.
I don't sense anything nefarious as this point but cautious as always.
My position is very small (under 3000 shares) so downside risk is also small.
Will keep you posted if you like. I found this stuff in the June 1999 10Q interesting. It gets kind of long, sorry.
Interests in other companies:
As of
Investments in Affiliated Companies: April 30, October 31,
1999 1998
--------- ----------
a) Forest Hill Capital Corporation $ 468,248 $ 468,247
b) Virilite Neutracutical Corporation 68,746 68,746
c) 660407 Alberta, Ltd. 38,000 38,000
--------- ---------
574,993 574,993
Less: Provision for losses (571,000) (571,000)
--------- ---------
$ 3,994 $ 3,993
========= =========
Some hard assets:
NOTE 4. PROPERTY AND EQUIPMENT
April 30, October 31,
1999 1998
--------- ----------
Mill and yard equipment $ 750,409 $ -0-
Office equipment 42,523 -0-
Trucks and other vehicles 393,660 -0-
Restaurant equipment and furniture -0- 435,311
Leasehold improvements 74,983 29,101
--------- ---------
1,261,575 464,412
Accumulated depreciation (20,046) (439,701)
--------- ---------
$ 1,241,529 $ 24,711
========= =========
During the quarter ended January 31, 1999 the Company wrote off the
net carrying value totalling $24,711 of the fixed assets related to
its restaurant operations.
They got a plan to get debt load down:
Annual maturities of long-term debt at April 30, 1999 for each
of the succeeding five years are summarized as follows:
Year Ending April 30:
2000 $ 8,591,926
2001 604,157
2002 472,964
2003 136,332
2004 and after 181,777
AND...here is the info on the lumber company acquisition:
NOTE 14. ACQUISITION OF LUMBER OPERATION
On February 25, 1999 Value Holdings, Inc., through its wholly owned
subsidiary corporation, Network Forest Products Limited, acquired
substantially all of the assets of John Ziner Lumber Limited, an
Ontario corporation. John Ziner Lumber Limited is involved in the
distribution and remanufacturing of lumber. Value Holdings intends
to use the acquired assets in the same type of business.
Value Holdings owns all of the issued and outstanding Class A
common shares, the only shares with voting rights, of Network
Forest Products. Robert Ziner, formerly an executive with John
Ziner Lumber, and president of Network Forest Products and Value
Holdings effective February 25, 1999, is the beneficial owner of
3,416,335 Series B Special shares of Network Forest Products, held
by 1341125 Ontario Limited, which have no voting rights, but which
are exchangeable for a certain number of common shares of Value
Holdings. Additionally, 5,253,147 Series A Preferred shares were
issued to John Ziner Lumber Limited as part of the purchase price.
The Series A Preferred shares are redeemable by the purchaser for
$1 Canadian dollar per share plus any declared unpaid dividends
thereon, and bear cumulative dividend at the rate of 5% per annum
calculated annually and payable semi-annually.
The Company purchased the assets for $21,044,335 Canadian dollars.
This amount includes $5,807,611 Canadian dollars for accounts
receivable, $5,531,025 Canadian dollars for inventory, $98,138 for
sundry receivables, and $6,761,302 to replace a bank operating
loan. Financing for the transaction was provided by BNY Financial
Corporation- Canada, a subsidiary of the Bank of New York. Value
holdings has provided a guarantee to BNY Financial Corporation -
Canada securing the indebtedness of Network Forest Products.
Summarized pro-forma results of operations giving effect to the
transaction as of November 1, 1999 are as follows:
Sales $ 18,963,717
Other income 206,329
-----------
Total revenue 19,170,046
-----------
Cost of sales 14,971,741
Other operating expenses 2,583,085
Depreciation and amortization 286,960
Interest and other charges 311,506
-----------
Total expenses 18,153,292
-----------
Net Income before tax $ 1,016,754
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