[off topic, skip if you're not interested in CrossKeys]
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I was wondering if you managed to get into CrossKeys (as mentioned a few weeks ago)? They seem to be making a move, as far as I can discern no news has been released, but momentum is developing.>>>
Frank --
I got in at 11 1/2 and sold half my position today at 14 3/4. I can't find any news and looking at the strong close, I think I sold too early. I did call Cowen (the U.S. underwriter) and they said the company's still in a quiet period, so even if they could give information to individual investors (which they can't), they wouldn't.
I'm guessing someone's getting ready to cover after the quiet period ends on Jan. 12. Purely a guess. It could be a contract ready to break or simply the fact the company's finally being noticed.
In case you don't have the prospectus, here are some numbers:
Annual revenues (in thousands) beginning in '94:
$2,908; 10,046; 10,108; 21,465;.
Six months: '96, $8,163; '97, $17,666.
EPS (in US)
0.14, 0.22, (0.11), 0.01,
Six months: '96, (0.07), '97, 0.12
Working capital as of Nov. 2, 1997 was $15.7M. "In the six months ended November 2, 1997, the cash provided by operating activities was positively impacted by the receipt of approximately $5.0 million of advance payments relating to customer-funded product development contracts."
Cash and cash equivalents (in thousands) = $17,726
Total assets = $36,537
Long-term debt, less current portion = $401
Total shareholders' equity = $22,467
Terence Matthews, CEO of NN, is Chairman of the Board (22.5% shareholder), and NN maintains a large position in the Company (31.4%).
Strategic relationships are primarily with NN, Siemens, and Digital Equipment Corp.
From the prospectus:
Newbridge Networks:
"Newbridge and the Company continue to enhance their business relationship. Current activities include cooperative software development, marketing and licensing of complementary products. The Company's software products are marketed, licensed and supported around the world on a collaborative basis with Newbridge.
CrossKeys has entered into a services and stock subscription agreement, a distribution agreement and a master development agreement with Newbridge. CrossKeys and Newbridge have ongoing commercial transactions with mutual customers which are reflected in various agreements to which both the Company and Newbridge are parties or to which the Company is a subcontractor to Newbridge. Newbridge is also a significant shareholder. . ."
Digital Equipment:
"The Company partners with Digital in bidding, delivering and supporting the Altus line of products. CrossKeys' relationship with Digital provides CrossKeys with access to an industry-leading systems management platform and an active telecommunications service provider user base. The Company also works with Digital to promote theResolve line of products. The Company is seeking to further its relationship with Digital through training fo Digital sales force, as well as through joint marketing and selling efforts. CrossKeys devotes a team of more than 35 people to applications development in support of Digital's TeMIP platform. In addition, this relationship also provides the Company with increased market presence, particularly in Asia and Europe."
Siemens AG:
"CrossKeys has worked with Siemens since early 1996 and is currently engaged in a CFPD program to create a standards-compliant, Element management product for the 36190 Switch. This program involves a cooperative development effort on the part of CrossKeys and Siemens staff. CrossKeys obtains the benefit of access to and understanding of one of the industry's most advanced, high capacity ATM switches, as well as a right to a future royalty stream. Siemens will have the benefit of an advanced Element manager delivered by an independent software vendor focused on this domain. The Company's relationship with Siemens has depended, and to some extent continues to depend, on Newbridge and the existence of an alliance between Newbridge and Siemens. Newbridge and Siemens formed an alliance in March 1996 which includes common branding under the MainStreetXpress name for ATM products and joint sales and marketing efforts."
Over 140 end-users have licensed, including:
Airtel Telefonia Movil S.A.
AT&T
Bell Atlantic
Bell Canada
Bell South
Cable & Wireless
China Ministry of National Post and Telecom
Communications Authority of Thailand
Deutsche Telekom
Energis Communications
France Telecom
Hungarian Telecom
IXC Comm
Maritime Telegraph and Telephone
MCI
MGTI (Mitra Global Telekomunidase Indonesia)
Optus Vision
Southwestern Bell
Swiss Telecom PTT
Telecomunicacoes Brasileras (Telebras)
Telefonica de Argentina
Teleglobe Canada
Telenor A.S.
These are just a few highlights. If you can, call the company and get a prospectus so you can read about the technology and their key products.
crosskeys.com
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Copies of the prospectus may be obtained from Cowen & Company, Financial Square, New York, New York, 10005-3597, Telephone: (212) 495-6000; SBC Warburg Dillon Read Inc., 535 Madison Avenue, New York, New York, 10022, Telephone: (212) 906-7000; CIBC Wood Gundy Securities Inc., BCE Place, P.O. Box 500, 161 Bay Street, Toronto, Ontario, Canada M5J 2S8, Telephone: (416) 594-8000; and RBC Dominion Securities Inc., P.O. Box 50, Royal Bank Plaza, South Tower, 4th Floor, Toronto, Ontario, Canada M5J 2W7, Telephone: (416) 842-2000. <<<
An article I hadn't read until tonight, lists GTE as a strategic partner, as well:
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CROSSKEYS WINS EXPORTER OF THE YEAR AWARD
KANATA, ON (November 13, 1997) - CrossKeys Systems Corporationwas named the 1997 Exporter of the Year Award at theOttawa-Carleton Business Achievement Awards presentation on WednesdayNovember 12, 1997. The Awards are organized by the Ottawa-CarletonBoard of Trade.
Nominees for the Exporter of the Year Award were judged on theirdemonstration of increased export revenues and diversified globalsales reach. CrossKeys was chosen from a list of six finalists.
"This is a credit to everyone at CrossKeys who believes indelivering valuable service to global telecommunications providers,"said John Selwyn, President and CEO. "The award further reinforcesOttawa's position as an international centre for excellence intelecommunications."
Contributing to its success in global exports is the fact thatCrossKeys has developed a unique model of strategic partnershipand direct sales. In 1997, CrossKeys diversified its regionaloperations with 42 per cent of revenues from North and South America,35 per cent from Europe, the Middle East and Africa, and 23 percent from Asia Pacific and Russia. In previous years, North andSouth America accounted for up to 75 per cent of its exports.CrossKeys posted a 112% increase in revenues from FY96 to FY97($10.1 million to $21.5 million).
To increase channels to market, CrossKeys has established strategicpartnerships with Newbridge Networks Corporation, Digital EquipmentCorporation and Siemens AG as well as systems integrators likeAscom and GTE. CrossKeys currently employs more than 260 peoplelocated in eight countries including United States, Brazil, UnitedKingdom, Germany, France, Hong Kong, and Australia.
About CrossKeys
CrossKeys Systems Corporation (www.crosskeys.com) is a leadingdeveloper of service, network and element management solutionsthat telecommunications service providers use to gain competitiveadvantage in deregulated markets. CrossKeys combines a commitmentto research with extensive experience in the world's most demandingtelecommunications markets to deliver highly advanced softwareapplications. A leading supplier to Newbridge Networks Corporation,Digital Equipment Corporation, and Siemens, CrossKeys productshelp service providers deliver differentiated services, implementnew technologies, and manage multiple vendor networks.
CrossKeys has been ISO 9001 certified since 1995. CrossKeys isan active member of the Network Management Forum (NMF) and hasbeen named one of Canada's 50 Best Managed Private Companies ina national competition sponsored by Arthur Andersen & Co.and the Financial Post. In 1996, CrossKeys was presented withthe Canadian Advanced Technology Association (CATA) award forinnovation in emerging technologies.
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