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

To: Nero who wrote (2348)	4/8/1998 11:22:00 PM
From: david james	Read Replies (2) \| Respond to of 2841

I talked to IR today that said that they are still planning to release earnings on time (a week from today - April 15). Yes, the movement doesn't look good and I don't think that 30 cent estimate by HJ Meyers helped much. Norris said that this is usually a slow quarter and I haven't heard many people expecting much more than 20 to 22 cents - which is what I'm expecting. To do that, they will need to make more than $6 mill before taxes - which compares to about $3.6 mill a year ago. I don't think they've sold any subs, or have any unusual gains that I know of, so this will be the regular earnings, fully taxed. No reasons to discount the earnings. Hopefully the balance sheet will look clean with some positive cash flow. The $5 mill "invested" in DBCO will affect cash flow - but I don't think that was put in until 2nd quarter. I heard that McGinnis in his radio program with Presidential has been saying that EIFH will be taken care of this year - which would certainly add to cash flow if they get that 'investment' back (at least $17 mill). EIFH filed their Proxy with the SEC detailing their planned reverse split and the possible conversion of Eco's loan to equity. That would certainly be a positive if Eco gets all their cash back - even better if they get a profit. edgar-online.com I guess one of the reasons I am still in this stock is because of the potential of MM Industra and SRS. I really don't follow much of the rest of eco, but I think it is realistic to get $10 mill in profit after taxes from MM Industra ($60 to $70 mill in revs) and at least $5 mill out of SRS. That would be 75 cents without the rest of the subs. What I can't figure is how much of these revs and earnings will be in first quarter. I expect that most of the income from the $13 mill MM Industra contract will get booked in 1st quarter (Halef was confident of his 30% pretax margins when I talked to him - which is also mentioned in the S+P report which showed that specialty fabrication had 30% margins). All the analysts still seem to have strong buys. Nelsons which is the most complete, shows a mean of $1.18 this year fully taxed and $1.76 next year. So its currently trading at a P/E of just about 5 on 1999 estimates. Management did lose a lot of the trust and confidence that shareholders had put in them, but I don't think it will take all that long to regain it, if they can produce some solid numbers. David