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To: ezmoney who wrote (1394)	10/24/1999 1:32:00 PM
From: Francois Goelo	Read Replies (1) \| Respond to of 1567

Phileo (PHMG) is now listed on Index #3 on Stock Watcher's Thread... Message 11684327 Regards, F. Goelo + + +

To: ezmoney who wrote (1394)	10/25/1999 8:15:00 PM
From: Francois Goelo	Respond to of 1567

**### EXTENSIVE D.D REPORT on PHMG ### 1) Sources: I have spoken at length with Mark Holden and Larry Kristos, (604-250 5294) former and current PR/IR for PMG and was sent an investor's package... In addition, I have just spent 55 minutes on the phone with Mr Datwani, Lawyer for PHMG in Hong Kong to try and fully comprehend the implications of the deal... The following is my understanding of these conversations... 2) Overview of the Deal: Phileo is in the process of acquiring what seems to be a "Cash Cow" in Quangdong, one of the most developed part of China, near Hong Hong and Macau... 2800 Kilometers of Optical Fiber Network carrying Telecommunications and Cable TV signals in a large loop connecting the main cities in this fast developing area... Phase I and II are already operating and produced a positive cash flow of some $6.5 Millions last Year, from wholesaling capacity to two large Telecom and Cable TV Operators. Operation and maintenance cost are quite low and of the order of about 8%, leaving net Profits of just under $6 Millions... 3) Income Increase: Income should dramatically increase as the economic activity expands in the area... The Company intends to build up retail services for the Network by carrying IP telephone and other value added services to reap significant increases in revenues. The Network is already in final stages of negotiations on certain retail services. In addition, Phase III is nearing completion, which will boost positive cash flow to around US$22 million in 2000, US$28 million in 2001 and US$34 million in 2002, excluding planned Retail services like IP telephony and other value added services... 4) Share Structure: Currently, there are 6 Millions shares outstanding, while a Private Placement to boost working Capital has just been completed, which will add 9.5 Millions shares for a total of 15.5 Millions... In addition, on completion of the acquisition of the Network, the Company will issue 42 Millions common shares and 18 Millions Preferred shares that can be converted into common stock at a pre-established ratio, based on certain Revenue Performance to be reached by Year 2002... So, for the sake of simplicity, let's base our calculations on 75.5 Millions shares for Year 2000... 5) P.E Evaluation and Phileo's share of the Network: Searching for Businesses involved with the ownership and operation of Optical Cable Networks, I have come up with Quest Communications, QWST, with a PE of 101: biz.yahoo.com and Global Crossing, GBLX, which sports a PE of 232: biz.yahoo.com ... Both of these Companies, but GBLX in particular derive a substantial portion of their income from Networks ownership... These are fairly high PE's but the Major International Firm which has produced the Business Valuation based its estimates on a PE of 50, which we will adopt for our purpose... Now, we must bear in mind that PHMG is buying a 66% controlling interest in the Network.... 6) Asset Valuation and Target Price: Once the acquisition of the Network is completed by PHMG, its shares should have an Asset Value of around $1.30, based on the Professional Valuation done in 1997 and around $1.80 once the Upgrading of the Valuation is finished... Projected Revenue of the Network is $22 Millions for 2000, from which we should deduct operating and maintenance expenses of about 8% (-$1.8 Millions) and add an estimated 10% (+$2.2 Millions) additional revenue from planned retail services, for a total of $22.4 Millions... Let's factor in the 66% beneficial ownership to get about $15 Millions net earnings or an EPS of 20 cents for 2000... Applying the PE of 50 previously determined, we end up with a share price projection of $10.00 for Year 2000... Therefore, I think it's reasonable to expect revisiting the Previous Highs of $4.50 to $5.00 in the near Future... phileoinc.com 7) Disclaimer:** This expose was compiled from information supplied by the Sources described in #1, to help potential Investors with their Due Diligence and no responsibility will be accepted for any inaccuracies and/or omissions... This is not a recommendation to buy this stock, bearing in mind I am long and most likely Biased... So do your own extensive Due Diligence and only invest what you can afford to lose....

To: ezmoney who wrote (1394)	10/26/1999 12:10:00 AM
From: Francois Goelo	Read Replies (3) \| Respond to of 1567

PHMG: IR/PR Larry Kristos is going to Hong Kong beginning of November... to meet the Principals of the Company to complete his Due Diligence... He'll be carrying a list of questions that I am putting together... The PHMG Lawyer assured me this was a Bona Fide Business with a few Major Shareholders strictly "controlling" the stock... The 9.5 Millions shares will be "pooled", as well, so that the stock can build a base between $4.00 and $5.00... It is in their interest to do so, to lessen financing cost and to eventually file for NASDAQ... As you can tell watching the trading, there is little stock available and most trades are "Buys" at the ask... They're also in the process of being Audited by a "Big Five" Company in order to complete the filing of the 10SB, as soon as possible... The reason the stock went down is due to the Company's lack of experience in dealing with certain IR and PR Firms, which did precious little, while flooding the Market with their Free Shares... They've learned their lessons and they now reward their new IR/PR Firms based on performance, from what I understand... I believe the stock will have little difficulty to climb back to the $4.50/$5.00 level, where trading should become more balanced... Regards, F. Goelo + + +