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Gold/Mining/Energy : American Eco (ECGOF, ECX on Toronto exchange) -- Ignore unavailable to you. Want to Upgrade?

To: david james who wrote (2106)	3/9/1998 12:37:00 AM
From: Brian P.	Read Replies (1) \| Respond to of 2841

Thank you for the figures David. I've added "EPS before tax" and "EPS fully taxed" lines to your table. 1997 1996 Percent Change ---------- ------------ --------- $220,478,000 Revenue $119,529,000 84 Percent $19,264,000 Income Before Tax $7,954,000 142 Percent $(1,829,000) Income Taxes $809,000 N/A $17,435,000 Net Income $8,763,000 99 Percent 16,218,034 Weighted Average 10,846,516 50 Percent Shares $1.19 EPS before tax $0.73 63 Percent $0.75 EPS fully taxed (37%) $0.46 63 Percent $1.08 Basic EPS $0.81 33 Percent We now have a situation in which a company with an outstanding 5-year growth rate grew pre-tax earnings per share last year by 63%, and actual EPS by 33%, but is saddled with a PE of 9 (or a PE of 13 based on earnings fully taxed) because it failed to anticipate adequately it's evolving tax liability and it overpromised. Management up to now have demonstrated that they can grow the business and increase shareholder value if not the stock price. For me, the issue turns on this: I will continue to hold my shares if Mr. McGinnis deals swiftly and effectively with the inadequate finance department and shows he can find the right people to do a job; if I can trust that we have at the helm both a CFO and a CEO up to the job; and more concretely, if 1st Qtr earnings are released on time (as McGinnis said he would make every effort to do in the CC). So, although the buck stops at McGinnis with this recent setback, I am willing to wait and see if he can deal with it and come out stronger for it. Some of you may be less forgiving and will see a glass half-empty when I see it half-full. I welcome other viewpoints on this.