Took a large position on this ...
Company Name:DEFINITION LTD
Address:UNIT 4, 1334 SOUTH KILLIAN DRIVE
LAKE PARK, FL 33403
Telephone: 1 888 345 6060
Exchange:OTCBB
Status: Ticker Symbol:DFNL
Primary SIC Code:7812 Motion Picture & Video Product
Number of Shareholders:1,164
Current Outstanding Shares:5,081,842 Float:2.5MM
Number of Employees:15
Description of Business:
Produces direct response programming and interactive programming including educational software; sells television advertising media; sells video copies, film clips and programming from its broadcast film library; produces television programs and infomercials; and provides computer hardware and technical support to its customers.
Key Financial Ratios And Statistics
Fiscal Year End:12/31
Net Sales/Employee:$277,321
Annual Dividend:0.00
Current Ratio:4.12
EPS (12/31):N/A
Quick Ratio:3.86
Price/Earnings (12/31):N/A
Return on Assets:0.12
Return on Equity:0.13
Net Sales (000's):$4,160
Net Income (000's):$1,050
Total Assets/Equity:1.12
CEO is Orvill Baldridge, new in August of this year
PR FIRM: World Vision 1-888-345-6060, Ask for Michael Dooley
The company files quarterly reports with the SEC which can be found on Edgar Online
MORE ON THE BUSINESS:
Gets Income from sales of copies of its film library to video stores and TV stations.
Also owns WINQ-TV
Gets income from production of infomercials and educational programs.
Gets income from Cable TV/Internet operations
Owns Blue Sage Entertainment, which procures films for rental and sale to networks
Owns a radio station
TOTAL ASSETS:
4.5MM audited, but the real value is considerably higher
BOOK VALUE:
Appx .90 at low audited figure
TOTAL SHARES OUTSTANDING: Appx 5 million
FLOAT: Appx. 2.5 million
OTHER INFO:
Web Site: dfnl.com (under contruction but worth a look)
Looks like a successful turn-around in progress.
Jan-June 97 Jan-June 96
Net income (loss) $ 157,476 $ 887,352
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We spoke at length to Michael Dooley at IR. Especially attractive is the fact that there are a total of no more than 5MM shares outstanding. The float is a small 2.5 and I am told that many of these are closely held. If there is further dilution in the next year, we were told it would be minimal. Revenues were way down for the first half of the year as management and the company business underwent considerable reorganization. Somehow the company managed to make a small profit, although they will probably show a small loss for the full year. Fully audited financials for the year should be out in an SEC filing on Tuesday. An insider recently purchased 500K shares at the market above current prices.
We also spoke to the new CEO. Apparently the old management ran the company into the ground, and the new management has cleaned up all the old problems and has the company clearly on track. This is why audited financials are coming out on Tuesday. He told us that as soon the audited financials came out, there were many who were holding the stock at much higher prices who would be averaging down. The audited financials will show a decline in assets which resulted from cleaning up the company. However, new management is honest and straightforward and has big plans for the company--both in terms of its TV station and of its wholly owned subsidiary, Blue Sage Entertainment, who has purchased previously unseen films of, among other celebrities, the Beatles, the Rolling Stones, Elvis Presley and Marily Monroe. The company has an agreement with Handleman Distributors, who is said to be the premier distributor in this business, to market the films nationwide to various video rental and sales chains. The chains will charge $20/video and the company will receive $10/ video free and clear. We were also told that the company was in talks with major networks and cable channels to regarding these films. The company had hoped to have these films on the market already, but they are being cleaned up for distribution and they should be ready in the next month or so. The press release below gives some idea of management's expectations of video sales. They project $3MM in pre-tax profits for the first quarter ( or .25/share, which has been delayed a couple of months). If those projections hold, then we are looking at about 10MM in pre-tax profits from the videos alone for this year. Remember we are talking about a company with 5MM shares total and a float of about 2.5MM. The CEO also told me there would be 6 news releases in the next 6 weeks, each in regard to good news about the company and its prospects for revenue growth and profit. He stated unequivocally that the the company would be profitable this year.
Furthermore, we have just been informed that the company has secured 5MM in contracts in addition to the Blue Sage films mentioned above!
The company also owns a TV station in Florida. This station is now pulling in advertising and other revenues of about $30K/month. However, with in the next couple of months they will be carried by a cable company, which will rapidly increase their subscriber base and their revenues to $100K/month.
Press Releases :
Tuesday December 9, 11:23 am Eastern Time
Company Press Release
SOURCE: Definition, LTD.
Definition, LTD. Enters Into Agreement, Projects Pre-Tax Income Of $.25 Per Share For 1st Quarter 1998
LAKE PARK, Fla., Dec. 9 /PRNewswire/ -- Blue Sage Entertainment, a wholly owned subsidiary of Definition, LTD. (OTC Bulletin Board: DFNL - news) has entered into an exclusive agreement to market the ''Legend'' series. This series consists of four one hour documentaries by the Beatles, Rolling Stores, Marilyn Monroe and Elvis Presley. Each video contains footage not previously released. The agreement is for five years and covers the U.S. and Canadian market.
Blue Sage Entertainment has secured the services of the largest U.S. distributor of audio and video products to provide nationwide distribution. Donna Anderson, President of Blue Sage Entertainment, states preliminary projections provided by the distributor, are conservatively estimated at $3,000,000 for the first quarter of 1998. This projects into $.25 per share pre-tax earnings. For additional information on Definition, LTD., visit their website dfnl.com .
SOURCE: Definition, LTD.
Wednesday December 3, 11:39 am Eastern Time
Company Press Release
SOURCE: Definition, LTD.
Definition, LTD. Announces Joint Venture Agreement
LAKE PARK, Fla., Dec. 3 /PRNewswire/ -- Definition, LTD. (Nasdaq: DFNL - news) is pleased to announce a joint venture agreement with Sun Broadcasting Systems, Inc. (Nasdaq: SHLD - news) and WINQ-TV, a subsidiary of Definition, LTD. The three-year agreement calls for Sun Broadcasting, Inc. to provide up to $30,000 per month in operational expenses and up to $10,000 per month in programming expenses. Sun will be the managing partner. Profits generated by WINQ-TV will be split 50/50 net after expenses.
Definition, LTD. will:
1. Aid program director with clearance of national programming.
2. Aid in acquiring stations to carry the network at an accelerated rate.
3. Aid in setting up automation equipment to trigger local spots at LPTV Affiliates.
4. Aid stations that are currently not on cable, to get cable coverage.
5. Offering affiliates its services in upgrading facilities.
Definition, LTD. has issued instructions to the transfer agent to cancel approximately 3.2 million shares of Definition, LTD. stock that has no supporting documentation for being issued. This will leave the issued and outstanding shares at approximately 4.5 million shares. |
