Yet another fraudulent promoter tied to Ziasun and CONolog
...among all the cats and dogs
are a few champions...
Conolog Corporation
(908) 722-8081
Nasdaq: CNLG
Recent Price: $150
disclaimer
Conolog Corporation, (NASDAQ:CNLG) is engaged in the design, manufacture (directly or through subcontractors) and distribution of small electronic and electromagnetic components and subassemblies for use in telephone, radio and microwave transmission and reception and other communication areas that are used in both military and commercial applications. The company's
products are used for transceiving various quantities, data and protective relaying functions in industrial, utility and other markets. In 1981 the company acquired one of its customers, Iniven Corporation. At that time, the company was manufacturing, on behalf of INIVEN, a line of transmitters and receivers used for controlling and transceiving the measurement of the flow of gases and liquids, by gas and water utilities, for controlling the flow of waste water and sewage and measuring and controlling traffic.
INIVEN equipment is designed around four core product groups:
PTR (Protective Tone Relaying) Teleprotection Series Communications Terminal.
Audio Tone & Telemetry Equipment (Audio Tone Control, Telemetering and Data Transmission Systems)
Multiplex Supervisory Control System
Communication Link Multihead Fiber Optic Couplers and Industrial Grade 1200 Baud Modems.
Since the 1980's, Conolog has been an active participant in providing electromagnetic wave filters for major military programs, such as the Patriot Missile, Hawk Missile and Sea Sparrow Missile. In addition to these projects, Conolog components are currently used by the military in tanks, the Apache helicopters and the MK-50 torpedoes.
During 1987, the company made the strategic decision to redirect the company's focus from military to commercial markets. Since that time, the company has refocused on manufacturing and marketing its products for the commercial marketplace rather than depend on the military and defense-related markets. The effort has included the introduction of new products, the redesign of existing products and increased advertising and marketing efforts, as permitted by its limited financial resources. The percentage of revenues attributed to products manufactured for use in commercial applications increased from approximately 4% of sales in 1981 ($171,000) to approximately 82% of sales in 1998 ($616,752). The decision to embark on this program entailed a major design effort, including the coordination of outside engineering consultants to develop a complete line of products aimed at the company's target markets. The primary emphasis was on products for electric utilities, co-generation of power, gas and water companies, traffic control for departments of transport (DOT) and airports utilizing DSP (Digital Signal Processing) technology. Commercial product sales in 1999 were approximately 24% ($580,000). Due to the end of the cold war and the downsizing of the American military, the company experienced unexpected sharp reductions of military contracts in fiscal 1993 (the company's fiscal year ends on July 31) resulting in a 50% decline in the company's sales for that year, down to $1,486,298 from $2,997,308 in fiscal 1992. The sales of new products could not replace the decrease in military sales.The company, however, continued to pursue sales as aggressively as its available resources would permit.
In September 1998, the company acquired the assets of Atlas Design, Inc., a human resource outsourcing company, for $145,000 in cash to further its strategy of mergers and acquisitions, and to assist in providing qualified engineering and technical staff in support of Conolog's longer term contracts.
Atlas Design provides short and long term qualified engineering and technical staff to the country's leading companies as well as human resource consulting. Atlas Design's integration with the company will provide a pool of project engineering leaders and software designers in support of the company's longer term contracts including the GE PTR-1500 series.
Both the sale of the building and the acquisition of Atlas Design, Inc. is in line with the company's expansion plan through acquisitions, mergers and GE software support.
In general, the company's products are marketed by means of telemarketing and customer contacts by the company's direct sales force and through independent manufacturing sales representatives and distributors.
The company markets its military sales directly and through independent manufacturing sales representatives. The company markets the PTR-1000, PTR-1500 and all of its INIVEN products by means of company sales personnel, through independent manufacturers representatives, and through distributors, focusing mainly on the largest utilities and co- generators. In the United States alone there are over 500 large entities generating electricity which are identified as investor-owned, municipal systems, cooperative systems and federal, state and district systems. Conolog Corporation intends to expand its sales efforts and expand sales to international markets. The company markets its Gen-1 and Gen-1 Programmable Series, as well as its "98" Series, "68" Series and "40" Series, in the same way as the PTR-1000 except that the manufacturers representatives used by the company specialize in selling to the diverse markets that utilize such products.
Total revenue for Conolog increased $1,809,237 or 242.39% from $746,420 to $2,555,657 in 1999. This increase was attributable primarily to the acquisition of Atlas Design in September 1998.
For the second quarter ended January 31, 2000, the company reported total revenues of $1,767,824 compared to $589,328 for the same period last year, an increase of $1,178,496 or approximately 300%.
The company reported a total net income for the period of $328,743 or $0.06 per share versus a net loss of $510,338 ($0.12 per share) for the second quarter of fiscal 1999.
For the first six months of fiscal 2000, net sales increased 255% to $2,319,951, compared to $908,677 for the same period last year. Net loss for the first six months of fiscal 2000 totaled $71,350 ($0.02 per share) compared to a net loss of $229,831 ($0.05 per share) last year.
The company anticipates revenues for the third quarter, ending April 30, of $1.6 million, a 176% increase over revenues for the same period in 1999. The company also expects a 154% increase in third quarter earnings over the same period last year, and a projected quarterly earnings per share (EPS) of $.02.
Nine-month revenues are expected to reach $4 million, an increase of 218% over 1999 nine-month revenues. The projected nine-month EPS is $.12.
On April 27th, the company announced that it has signed a letter of intent to acquire Independent Computer Maintenance Corporation, located in Clifton, New Jersey, for a combination of cash and stock. Details of the proposed transaction were not disclosed.
The closing of the proposed transaction is conditioned upon, among other things, the execution of an Agreement of Purchase by the parties, Conolog's completion of its due diligence review of Independent Computer Maintenance Corporation, the completion of audited financial statements of Independent Computer Maintenance Corporation, and approval of the transaction by Conolog's Board of Directors.
Independent Computer Maintenance Corporation provides installation, maintenance and troubleshooting of commercial and corporate computer systems and networks in the greater New York metropolitan area. Its projected revenues for fiscal 2001 are $2.0 million.
Conolog Corporation's strategy for the future is to exploit new commercial markets by continuing to develop new products and enhance existing products to improve both its market share and competitive position. Growth in commercial sales is expected to come through internal growth of existing products, new product introductions and the expansion of regional markets to meet the growing needs of its customers for more sophisticated and comprehensive products and services. The company introduced a fiber optic digitizer during fiscal 1996. The company believes the largest growth opportunity remains with the electric utility market, although it intends to reach other industrial and utility markets such as railroad and waste water, respectively. The company began an advertisement program during 1996 and devoted substantial resources as available for promotion. The company intends to participate in various trade shows, such as the Utilities Communications Council and IEEE/PES during the forthcoming year.
NEWS AND VIEWS
...keeping up with previous picks
...information you can't find in the newspapers
Last month, my 'Pick of the Litter' was Pacific Aerospace & Electronics, Inc. (Nasdaq: PCTH). One of the key points that I mentioned was the company's ability to create technological breakthroughs. Well, the company just announced that they recently received initial orders from two major defense companies for its new line of MIL-STD ultra miniature, hermetically sealed D-configuration connectors. Based upon the company's leading edge interconnect technology, the new series of ultra-miniature connectors are 40% smaller than the Company's current line of Micro-D connectors. These products utilize proprietary manufacturing technology including, Kryoflex® polycrystalline ceramic and EWS( (Explosively Welded Stack). Kryoflex is a multi-phase derivative of ceramic oxide crystalline silicates that is compatible with a variety of shell and conductor materials. It demonstrates superior electrical performance while withstanding mechanical and thermal stresses far beyond what can be endured by glass-to-metal seals. EWS is a process used to permanently fuse, at the molecular level, otherwise incompatible metals. Leading defense and aerospace manufacturers are increasingly recognizing the benefits of the company's unique sealing and miniaturization technology, which allows them to bring products to market that are more compact and lightweight, and which can withstand the rigor of demanding environments. After last month's issue came out, I received more calls for new subscriptions to this newsletter than ever before. There's solid long-term potential here folks with PCTH, and there are other analysts who are starting to follow the stock as well.
Lot's of things are happening at China Premium Food Corp. (OTC:CHPF), the largest announcement of which won't be made public until after this issue has already gone to press! Call me if you'd like, and I'll get the press release to you. As for recently published news, the company said that it has closed a $1.5 million financing, in the form of convertible preferred stock at a fixed price. These funds represent the first of a series of investments that are planned and structured as investment warrants at various strike prices. The preferred and the warrants have been priced above the current market. This will increase the company's cash flow while at the same time reducing their burn rate. CHPF also reported net sales of US $5,664,661 at its 52%-owned Hangzhou Meilijian subsidiary, a 16% increase over last year. While continuing efforts of Hangzhou Meilijian to increase sales volume and introduce new products into its market area resulted in an increase in SG&A expenses and overall operating losses, those expenses decreased as a percentage of revenue in 1999. Management of China Premium reported that they believe this subsidiary to be moving toward profitability during the later part of 2000. Hangzhou Meilijian offers a full line of dairy products, including fresh milk, extended shelf-life juices, and extended shelf-life milk in cartons, in metropolitan Hangzhou, which is located about 180 miles southwest of Shanghai. The stock price is undervalued here folks, in my opinion.
There's been a setback at FreeRealtime.com, Inc. (OTC:FRTI). I told you last month that they were applying for a Nasdaq listing. Unfortunately, the company has not achieved listing of its common stock on the Nasdaq stock market at this time. They plan to re-submit their listing application as soon as they re-establish a market capitalization that meets the minimum required by Nasdaq. While the company had maintained a market capitalization that met the minimum quantitative Nasdaq standard for the required period of time leading up to the filing of its application, the company believes that the overall conditions in the public equity markets over the past several weeks adversely affected the company's stock price and its resulting market capitalization. The company plans to re-submit its listing application soon after it re-establishes a market capitalization that meets the minimum required by Nasdaq. Nothing ventured, nothing gained as the old saying goes. FRTI wasn't on Nasdaq when they were at $14.00, and I still believe that with all that they have going on, that they will get there again. The company has continued to achieve tremendous growth in both monthly revenues and traffic, they clearly have a widely recognized brand name in the on-line financial services sector, and I think that it's still a good time to buy more for the long-term investor.
Speaking of solid long-term investment opportunities, the first company that I ever wrote about when I took this newsletter over from my brother back in September of 1997 was National Environmental Service Company, now called NESCO(NASDAQ:NESC). This company has been in the portfolio longer than any other company I've had as my 'Pick of the Litter'. I've said time and time again that I felt the stock price was way undervalued. Well, the company just announced financial results for the first quarter ending March 31, 2000. Revenues were $9,532,000 or 26.6 percent more than revenues for the first quarter of 1999. Net income increased to $1,206,000 or $.13 per share compared to $940,000 or $.10 per share for the same quarter last year.
On top of that, the company announced that it has signed a letter of intent to acquire Kentucky Environmental Network of Betsy Lane, Ky. Under the proposed agreement, NESCO will acquire the company's assets and hire its employees. Kentucky Environmental Network provides consulting services to the owners of underground petroleum fuel storage tanks located primarily in eastern Kentucky. The company currently has approximately 175 contracts for the clean up of known contaminated sites regulated by the Kentucky Underground Storage Tank Program. Most of these sites will require soil and/or groundwater remediation with funding provided by the Kentucky Environmental Assurance Fund.
Wait! There's more! Nesco says that it has also signed a letter of intent to acquire Well Water Systems Inc. of Ft. Myers, Fla. Well Water Systems Inc. specializes in fresh water aquifer storage and recovery wells and large diameter public water supply wells. Well Water Systems Inc. is one of only a few companies qualified to provide this highly specialized drilling in Florida. The wells may have diameters up to 16 inches and as deep as 4,000 ft. There is a significant market for these wells not only in Florida, but also across the United States. Well Water Systems Inc. also drills agricultural, industrial, test and monitoring wells.
CEO Eddy Patterson also sees this as a great opportunity for NESCO to expand its presence and existing environmental drilling services in Florida through this acquisition. It allows NESCO to become involved in a growing and important new field by assisting communities in Florida to conserve water by storing excess run off from rainy periods in deep injection wells. During the annual dry season and periods of heavy use, these communities can then draw on this stored water to help alleviate the chronic water shortages. The company's stock price is at $4.50 with a P/E ratio of only 17. The 52 week high has been $6.82, and I think it will get that high again, and should be a lot higher, long-term.
GAeXpress (OTC:GAUM) has fallen off a little bit (+/-20%), so hopefully you followed our lead last month and took out half of the portfolio value at a +/- 300% gross profit. Based on recent news though, I think the balance is very safe. The company just announced it has launched a new suite of eBusiness development and connectivity software products into production. The new products, eTools( ODBC 4.0, eTools JDBC 4.0, eConnect( ODBC 4.0 and eDesigner( 4.0, include significant technology enhancements that support the company's ePath( strategy to enable customers that are part of the $3 billion MultiValue industry to participate in the Internet economy. The company also said it is creating a new business entity to provide eBusiness data transformation solutions for the mainstream B2B market. According to market analyst Forrester Research, 'The market for software and services to support electronic business will skyrocket from $25 billion in 1998 to $104 billion in 2003. A significant portion of the growth is attributed to systems-integration projects that link companies' Web sites to back-end order entry and fulfillment systems.' The company also announced today it will provide Glenn Computer Corp., a provider of services and automated systems for mortgage institutions, with new software and hardware products to advance the company's eBusiness initiative. Glenn Computer will implement GA eXpress' eTools( XML development software, which was recently launched into Beta, to enable the company to engage in comprehensive eBusiness with its customers. Under the terms of the agreement, General Automation will provide consultation, software, equipment and on-going services for the platform. Glenn Computer provides software and automated systems for mortgage institutions, enabling them to streamline management of billions of dollars in such areas as accounting, insurance, payments, credit reporting, investor reports, foreclosures, bankruptcies and collections. Because Glenn Computer's systems process highly critical information, it is imperative that the company's technology infrastructure is fault-tolerant, highly reliable and built on industry standards to allow for future growth. Glenn Computer chose the solution from GA eXpress because they are assured that the company's products and technical support would meet these needs.
Well, the words "I Told You So" continue to get closer and closer to coming out of my mouth. What am I referring to? (Like you really have to ask .) Leading-Edge Earth Products, Inc. (OTC:LEEP). They just announced completing the acquisition of the assets of LEEP Building Systems, Inc. ("LBS"), the company's manufacturing affiliate in Pennsylvania.
The asset acquisition gives LEEP control over its manufacturing technology, equipment, and processes. In addition, LEEP announced that it has leased a 33,000 sq.ft. manufacturing facility in Montoursville, Pennsylvania, to establish a plant that is about 10 times larger than the pilot manufacturing facility. Grant Record, CEO, commented, "We are ready to expand our production capacity. The new 120-foot rollformer we ordered last year will produce our steel skins with material time and cost savings to us, beginning next month. With the addition of two more containment presses, our operation will expand over the next quarter to 50,000 sq.ft. per month of LEEP STRUCTURAL CORE®.''
And that's not all! On April 26th, the company announced that it has delivered a building system to construct an 8,000 sq.ft. 2-story office building in Houston, Texas. The entire 2-story LEEP STRUCTURAL CORE building system was easily shipped on two trucks. Grant Record has had a vision for a long, long time. For those of us who have stuck around and exercised some patience, we're finally seeing the beginning of what we have always thought to be an incredible product with an incredible world-wide market potential.
PORTFOLIO PROGRESS
*This is not an actual portfolio, but approximates what a portfolio might look like if an investor had purchased an equal dollar amount of each of the securities below at the time of the original write-up....ed.
Company (Symbol)
Date
Selected
Americlean (AMCX)
Chapleau (CHI.V)
China Premium (CHPF)
CyPost (POST)
DAG Media, Inc.
Freerealtime (FRTI)
General Automation, Inc. (GAUM)
Itronics (ITRO)
Kafus Environmental Industries (KS)
Leading Edge Earth Products (LEEP)
NESCO (NESC)
Object Soft (OSFT)
Omicron Technologies (OGPS)
Pacific AeroSpace (PCTH)
Royale Energy Inc. (ROYL)
Spectranetics Corporation (SPNC)
ZiaSun (ZSUN) (Post 2 for 1 split equiv.)
Apr. `99
Oct. '99
Mar. '00
July '99
Feb. '00
Jan. `99
Sept.'99
May. '98
Oct. '96
Sept.'95
Sept.'97
Jan. '00
June '99
Apr. '00
Dec. `98
Jan. '98
Mar. `99
Price
Then
3.68
0.81
0.78
4.44
4.30
6.25
0.62
0.25
1.25
0.63
2.36
3.00
1.50
1.75
3.12
3.25
3.75
Price
5/5/00
0.30
0.80
0.94
1.06
4.19
5.00
2.00
0.97
4.38
0.40
4.44
2.38
0.23
1.53
2.88
6.50
7.06
Percent
+ / -
- 92%
+ 0%
+ 20%
- 75%
- 2%
- 23%
+ 222%
+ 288%
+ 250%
- 36%
+ 88%
+ 22%
- 21%
- 12%
- 7%
+ 100%
+ 88%
nicstock.com
The information provided herein is based on sources which National Investors Council, LLC (NIC) considers to be reliable, but it is not guaranteed by NIC, nor does this report represent a solicitation to buy or sell the securities discussed herein. The information contained herein is subject to change without notice, and NIC assumes no responsibility to update the information in this report. Any sales, and/or earnings forecasts included herein were independently prepared by NIC, unless otherwise stated, and are not endorsed by the management of the company which is the subject of this report. Use of this report may be subject to the applicable rules of certain self-regulatory organizations and securities mentioned herein which are traded over-the-counter may not be cleared for sale in certain states. National Investors Council, LLC and/or its employees, officers, affiliates, or members of their families may have long or short positions in the securities discussed in this report. NIC has been compensated $ 7,500 for the preparation of this report by the subject company of such report. |
