CIMA here is the Calgary Herald writeup. You can access it directly by the following link
www.calgaryherald.com/business/stories/990801/2674562.html
Sunday 1 August 1999
Snowboard manufacturer Kazz's stock rockets ahead
Deborah Yedlin, Calgary Herald
Greg Fulmes, Calgary Herald / William Morton, president of Kazz Industries, and Jeffrey Loomis, who is in charge of public relations, with the company's new Clone snowboard.
If you ask William Morton what's up, the former Montana ski bum will probably say, "my stock price."
Morton, president of snowboard manufacturer Kazz Industries, saw his stock hit a 52-week high on Thursday of $2.90. That's up from 25 cents in April.
Judging from a study of the snowboarding market, Morton might be in the right place at the right time.
According to the National Sporting Goods Association, snowboarding is the fastest growing sport in the world, with the market size estimated at $2 billion in the next three years. In 1998, the average retail price paid for a snowboard, without bindings, was $260 US.
Since becoming listed on the Alberta Stock Exchange in March, Kazz has signed agreements with Sports Superstore Online (SSOL) and U.S.-based high end toy retailer FAO Schwartz.
SSOL was the first sports e-commerce retailer, launching on America Online in November 1996. The deal allows Kazz to sell its snowboards online, as well as establishing a connection with Copeland Sports, SSOL's parent, a sporting goods chain with more than 50 stores in the western US.
The FAO Schwartz deal signed in July is a test marketing agreement for two of Kazz's products -- a translucent snowboard named Clone, which defies description, and a kids' snowboard known as Color Me for ages five to 12. Color Me comes with a package of Crayola crayons.
"We showed FAO Schwartz Color Me and then they saw Clone and said, 'we want that,' " says Morton, declining to disclose further specifics of the deal.
Kazz manufactures snowboards under its Identity subsidiary in Kalispell, Mont., but maintains its corporate office -- in an apartment building -- above Buchanan's restaurant in downtown Calgary.
Morton says the manufacturing facility is strategically located between two significant ski areas in Montana -- Blacktail and Whitefish. It's also close to Calgary, which Morton calls the snowboard capital of Canada.
"There is a high rate of participation in the sport in Calgary and I think that the Alberta Snowboarding Association is the best in the world," says Morton.
In addition to manufacturing eight different snowboards and an electronically controlled ski binding, Kazz is developing a high-end ski goggle and a motor-driven retractable ski pole -- items that sound like they would fit right into a James Bond movie.
The goggle, known as the Vector, gives the wearer real time information on their speed, the slope grade, time of day, distance and location.
The Vector is still in its development phase but Morton expects it will hit the market in the winter of 2000 and retail in the $350 range.
The Talon retractable ski pole, which has a liquid crystal time display, is powered by a rechargeable battery capable of operating at temperatures of minus 40 Celsius. The Talon, which comes in a carrying case fitted with a battery charger, is being tested and should be available by 2001.
According to Kazz's business plan, there are no competitors for the Vector or the Talon.
Morton says demand for Kazz's snowboards is strong but the company is not ramping up production to meet demand. Rather it is concentrating on establishing a presence in selected markets.
"Everybody wants us. We're cooler than cool."
Kazz had revenues of $250,000 in 1997, $1 million in 1998 and Morton expects the numbers to be between $2 million and $4 million in 1999.
There are 9.2 million shares outstanding, with 65 per cent held by directors and insiders.
Kazz shares closed at $2.58 on Friday, down 22 cents.
The ASE closed at 2,589.75 on Friday, up 13.14 from last week but still off the 52-week high of 2,607.85.
In addition to Kazz, strong performers included Ventus Energy, newcomer AltaGas, Highpoint Telecommunications and Wi-Lan.
Copyright © 1999 Calgary Herald New |
