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Gold/Mining/Energy : Alternative Fuel Systems ATF:VSE -- Ignore unavailable to you. Want to Upgrade?

To: Ally who wrote (649)	4/3/1998 3:10:00 PM
From: Stew	Read Replies (2) \| Respond to of 4605

Denise: What about getting irrevocable L/Cs up front? Also, would there not be some export guarantees from the Cdn. Gov't.?

To: Ally who wrote (649)	4/3/1998 10:22:00 PM
From: Mark Bartlett	Read Replies (2) \| Respond to of 4605

Denise, <<For this "project" of 1,050 units, AFS got a cash advance. I don't think it has already received the full $2 million. You may want to confirm this with management in your next contact with them. You may also want to ask how the company intends to finance the $20 million sales a year. And thirdly, ask them how they secured the Mexican project and beating 20 other competitors - was it clearly because of better technology, or better pricing. >:> Would it be reasonable to assume that YOU have spoke to the company to verify these numbers. In the above paragraph, you have asked Bonnie "in your (Bonnie's) next contact with the company ... " ..... what about YOUR next (first?) contact with the company. I see a whole lot of numbers - has ATF provided you with these data? ... or are these assumptions your own creation. I know for a fact that Bonnie has visited the company at least twice and spent several hours with them ... have you? I am all for dd and am very willing to listen to anybody that has facts to present (both positive and negative) - however, I am beginning to wonder what your motives are. ATF had their technology approved/endorsed by many more interested parties than just the Mexicans. The Japanese and Koreans both gave them a very thorough going over ... they obviously like ATF too. They are supported by other excellent well run large companies .... do their research at the University of Alberta ... have worked hard to establish/develop a global network ... and stand a respectable chance of a big contract with the Mexicans (nothing is for sure) .. etc. that is not too shabby! In the end, ATF may get nothing ... but I think that it is important to make sure we bring facts to the table .... and if things are assumptions/opinions - make sure it is clearly stated as such. BTW ... the phone number of the company is 403 262-1833. MB

To: Ally who wrote (649)	4/3/1998 11:46:00 PM
From: bc	Read Replies (4) \| Respond to of 4605

Hello Denise: <You were asking why AFS needs to look for financing (issue more shares) should it be successful in finalizing the letter of intent into a firm agreement for sales of 10,000 units per year to give a revenue of $20 million a year. Have a look at its audited income statement for the last year. Revenue was $48,393 and cost of goods was $37,497 that is, 23% margin.> Rather than just guessing and taking the risk of being incorrect, why not call the company and speak to the management. Ask them if they expect to issue more shares to meet the demand of 10,000 units per year. Management has stated to others who have contacted them directly that they CAN meet this demand without expanding facilities. Judging from your various posts it appears obvious that you have a good grasp on accounting, margins etc., therefore you must also know that profit margin on revenues of $48,000 would NEVER be the same as on revenues of $20 million.....let's see that's a 41,000% increase or so? Is this an attempt to mislead readers? Profit margins in the auto parts industry average around 30 to 50%. Your numbers are most likely way off base. Keep in mind that the company has a clean balance sheet, with no long term debt and has an approximate $20 million deficit that it can write off against income taxes. To come through so many years of development with a deficit this size, particularly for a company opening so many doors in so many foreign markets at the same time, shows considerable spending control. A total overhead of $1.3 million per year is quite reasonable. <How is management going to get this funding to support the sales? Presently it appears their cash flow is very, very tight. This will explain why recently they issue a private placement for 100,000 shares for $150,000.> Here is another unfounded 'guess'. I took the time to call the company on this and was advised that this placement had nothing to do with a tight cash flow, rather, it was an option agreement. Seriously do you really believe that they would raise funds $150,000 at a time? Management has been also strongly supported both financially and in their business for years by the Simmons Group (Simmons Petroleum Producers/Services, of Calgary) and Dale Simmons is the Chairman of the Board of AFS. If they need funding they can likely get it here but I think with firm contracts in hand they will have no problem getting what they need with a short term loan from the Royal Bank. < Someone in this thread mentioned that AFS will get paid in advance. Ugh, ugh, that's not how business works. Produce, deliver, then get paid. With a foreign country, getting paid is a bigger concern. That's why there is the letter of intent. It shows AFS don't trust it'll get paid and the money is escrowed in the bank to be released when products are delivered. > You sure know how to put a negative twist on everything. Again call the company and ask because I don't think what you are saying is correct. <For this "project" of 1,050 units, AFS got a cash advance. I don't think it has already received the full $2 million. You may want to confirm this with management in your next contact with them. You may also want to ask how the company intends to finance the $20 million sales a year.> Well since you have taken so much time to do all these figures without any REAL information I suggest that you make the call yourself. Ask for Gerry Klopp. <And thirdly, ask them how they secured the Mexican project and beating 20 other competitors - was it clearly because of better technology, or better pricing. > This is really not right. Think about it. Do you really think this consortium-CCM, CEM, Pan American, Hydro Quebec, Gaz de France, the Krause Group are going to spend all this money, with the worst air pollution in the world in Mexico City and use inferior technology that might just jeopardize everything they are trying to accomplish? Once again if you were to ask the company you would discover that the AFS system costs a bit more but is easy to install and very effective. There's two years of testing here Denise, in a worldwide competition. The ONLY conversion system with MOT approval in Japan also. <Should the $20 mill sales materialize, it would either have to take a loan (if a bank is willing to lend) or issue more shares. Mostly likely it will issue more shares. It's a long way from sales to eps. And in the final analysis, it is eps that will sustain a stock price appreciation.> Or they may just set up AFS Europe, ASF Asia and AFS South America public companies, raising financing, increasing value without diluting the parent company. Those of us who believe in the company will be here to wait and see. <p.s. I'm not a broker either. Any broker on this thread who may have a conflict of interest (e.g. firm planning to underwrite AFS in the future, or talking the stock up to support sales to clients) should fess up!> I have to wonder, for someone who has done so much dd and still thinks the stock is only worth .60 and with the market valuating it at $1.90, what is your ongoing interest in this company? Is there anyone involved in a stock that does not have a conflict of interest one way or another? The brokerage industry does most of the analysis on Canadian stocks and brokers have a lot of experience. I think they should be welcome here--no one has to tell anything about themselves if they choose not to ---that's the beauty of a chat group. It becomes obvious after a few posts what certain people are up to. So don't ask people if they are brokers and I won't ask you if you are shorting the stock. Bonnie