Our Stock Is Undervalued, Said Louis L. Knickerbocker At Annual Meeting of Stockholders
Core Business and Investments Are Not Reflected in
Current Share Price,' Says Chairman of LLK
Phoenix Environmental Ltd. Is Announced as Company's Newest Investment
LAKE FOREST, Calif., May 17 /PRNewswire/ -- At the Annual Meeting of Stockholders of The L. L. Knickerbocker Co., Inc. (Nasdaq: KNIC) held Friday, May 15 at the Company's new 55,000 square foot office and warehouse facility, Louis L. Knickerbocker, Chairman & CEO, said, "Our stock is undervalued at current trading levels and does not reflect the strength of our core business and the asset value of our investments. The L. L. Knickerbocker Company is stronger today than at any time in the Company's history. Operating losses in 1997 were noncash in nature and were attributed in most part to our acquisitions. The acquisitions changed our distribution and sales dramatically, adding distribution channels which will result in higher revenues and profits for 1998 and the future.
"Management's strategy within its investment division was recently validated by the public offering of Ontro, Inc. Our $650,000 investment in Ontro 18 short months ago is valued today at more than $5 million. Our $2.4 million investment in Pure Energy Corporation a little more than 24 months ago is valued today at more than $50 million. Our investment in Arkenol Asia, Inc., made only nine months ago, is already developing into what could be the Company's biggest and most important investment strategy."
Mr. T. K. Lau, a recent retiree from the U. S. Department of Energy and Director, International Affairs for Arkenol Asia, Inc., acting as coordinator in relations with Central Resource Northern Development Co., China and Regal Best Limited, Hong Kong, parties to the Memorandum of Understanding to build the first biorefinery in China using Arkenol Asia's technology, said, "From my frequent communications with China, I can tell you that they are very eager to build the first biorefinery plant with Arkenol Asia in China." Mr. Lau spoke to Ethanol: The Energy Source of the Future. He gave an account of his recent attendance at the Ethanol Conference, stating the benefits of Ethanol as efficient and environmentally friendly, Ethanol as a transportation fuel, and Ethanol production in the U.S. and in the world. "Ethanol's time has come!" said Mr. Lau. "It will be the clean burning fuel of choice in the 21st Century." The Company recently announced Raymond James & Associates, Inc. as the exclusive investment bankers to Arkenol Asia.
Mr. Knickerbocker went on to say, "With Ontro now public, we are pleased to announce our newest investment. In a stock exchange, we have traded 2% of our holdings in PEC for 6.7% of Phoenix Environmental Ltd. with a current valuation of $40 million. I have been following the development of Phoenix Environmental for two years, with a more serious focus on this investment for our Company in the past six months." Phoenix Environmental Ltd. is a development stage company with a patented, proprietary technology that converts steel mill by-products and other steel-based waste streams into a marketable industrial product. Robert West, recently promoted to Chief Operating Officer, reported on the Company's consolidation and restructuring, its reduction of manufacturing payroll, its plans to shift domestic manufacturing overseas to increase profit margins, its current negotiations to enter into strategic alliances for distribution at the retail level, and working with major chain stores to joint market certain programs. Mr. West stressed the Company's focus on reducing SG&A costs relating to services, legal, and development/sourcing.
"Our recently launched Kodak Moments by Marie Osmond, Universal Studios Glamour Collection, the Disney Art Classic Collection and the very 'hot' Richard Simmons Masters Collection, all promise to be strong brands for the Company, and are expected to produce significant revenues and profits within the core business in the near future," said Mr. West. "Trends set the pace and new products are the lifeblood of the Company. We will continue to build brand diversity, appealing to the baby-boomers, negotiating third-party licenses, and developing a male collectibles line."
Also presenting at the meeting were Martin Krasner for the Krasner Group, Inc. and Christine Taylor for Magic Attic Club. The Company introduced the newly appointed Daniel J. Rothmel as Executive Vice President, Worldwide Sales & Marketing. Mr. Rothmel spoke to the Company's goals "to achieve volume and profitability growth from our core business by enhancing marketing targeted at current collectors, by expanding the customer base, by investing in the Company's new retail sales force and in the ongoing development of new and innovative products."
Mr. Knickerbocker closed with a strong reminder to the shareholders, that "In our three short years of being a public company we have grown from $7 million to $68 million in sales, with assets grown from $2 million to more than $60 million, and in 1997 the Company turned around its five acquisitions from $8 million in losses to $1.5 million in profit." He emphasized that "the Company is now positioned for substantial growth with a focus on increasing shareholder value."
The L. L. Knickerbocker Co., Inc. is a diverse international company with operations in three strategic divisions: collectibles, jewelry and investments. The Company markets all of its products worldwide. Through its investments division, it has a 50% interest in Arkenol Asia, Inc., an approximate 28% equity interest in Pure Energy Corporation, and an approximate 13% equity interest in Ontro, Inc., adjusted for the public offering.
For more information visit The L. L. Knickerbocker Company web site at knickerbocker.com
This press release contains forward-looking statements within the meaning of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended, which involve risks and uncertainties, including, but not limited to, economic, competitive, governmental and technological factors affecting the Company's operations, markets, products, services and prices, and other factors. The Company's actual results could differ materially from those projected in the forward-looking statements as a result of the factors described herein.
SOURCE L. L. Knickerbocker Co., Inc.
CO: L. L. Knickerbocker Co., Inc.
ST: California
IN: FIN HOU OIL
SU:
05/17/98 19:15 EDT prnewswire.com
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