Company Press Release
Analyst Continues ALYA Coverage,
Reiterates 'Speculative Buy', $1 to
$1.50 Target, Shortens to 6 to 12
Months in PAR Program
NEW YORK--(BUSINESS WIRE)--April 20, 1999--The following is an investment opinion issued
by Public Analysis & Review (PAR):
(Investrend Research) Public Analysis & Review (PAR), the unique professional independent
analyst program administered by the non-profit Investors Research Institute, Inc., and distributed by
Investrend Research, announces that Gerald F. LaKarnafeaux, CFA, professional analyst qualified in
the PAR program, who initiated coverage of ALYA International (OTCBB:ALYA - news) on
September 23, 1998, has reiterated a 'Speculative Buy', a target of $1 to $1.50, and shortened the
target period to 6 to 12 months.
The report follows. PAR has posted a downloadable report, including disclaimers which should be
read before investing, at investrend.com .
Date of Report: April 20, 1999
Shares Outstanding: 15,754,626 (fully diluted)
Stock Price: $0.43
Estimated Float: 6,333,814
Latest 12 mo. Price Range: $.033 to $1.65
Recommendation: Speculative Buy
Industry Sector: Building Control Systems
Target Price (6-12 mos): $1.00 - $1.50
ALYA International, Inc. (OTCBB: ALYA - news), has developed and is currently marketing a
proprietary building access and control system that utilizes a software protocol developed by Echelon
Corporation named LonWorksa. ALYA's ultimate success will be, in large part, the result of an
industry-wide acceptance of the LonWorksa open architecture, which accommodates interoperability
among building control systems. The reader is referred to the ALYA International, Inc. research
report published on September 23, 1998, which describes ''interoperability'' and its relevance to
ALYA as a company and as an investment. This report is available at investrend.com on
the worldwide web. Additional background information is available on the LonMark Interoperability
Association website, lonmark.org , and on the Echelon Corporation website
echelon.com .
On April 6, the company released its financial results for the year ended September 30, 1998. The
conclusions to be drawn from the year-end numbers are that (a) the company is still in the
development stage and (b) the company is still undercapitalized.
Sales of $323,734 were nearly three times those of the prior year. However, the sales level was still
very modest when related to the major cost categories. For example, Research and Development
expenditures were 1.6 times sales. General and Administrative expenditures were 4.5 times sales.
Clearly, the cost structure is geared to a sales level substantially above the level reported. The loss
for the year of $2,222,430, was slightly below the loss reported in the fiscal 1997. Profitability does
not appear likely over the near term. Losses in the current fiscal year are estimated to be running at
approximately $200,000 per month with little improvement anticipated until the fourth quarter.
Current sales levels are currently running below management's expectations of six months ago. The
lagging sales rate could be due, at least in part, to installation delays that are caused by an installer's
inexperience with such a technologically advanced product. ALYA has had to send technicians into
the field to assist in the installation of new systems. The product has recently been modified to
eliminate the necessity to provide such costly customer support
ALYA has assembled a creditable international network of approximately twenty
distributors/integrators. Also, relationships have been established with high profile partners such as
Motorola, Honeywell, Raytheon and others. ALYA is positioned to generate substantial sales over
the next twelve to eighteen month period. However, in order to achieve a $15.0 million to $30.0
million sales level, as management has projected in the past, the company must generate external
equity capital in the range of $2,500,000 to $5,000,000 over the next twelve to eighteen months. This
is not an impossible task as evidenced by the history of resourceful money raising campaigns that
management has conducted in the past. Since the end of the fiscal year, approximately $1,500,000 of
capital has been raised through the sale of common stock or software rights. We suspect that the
issue will not be, can they raise the money? It will be, at what cost in terms of dilution.
ALYA is recommended as a speculative buy with the emphasis on 'speculative'. The stock is down
fifty percent since our speculative buy recommendation made last September. The surge in sales that
we anticipated early in the current fiscal year did not materialize. Assuming this same allusive surge
in sales does occur over the next six to twelve months, we believe ALYA will trade in a target range
of $1.00 to $1.50 per share.
Gerald F. LaKarnafeaux, CFA, during the past 30 years, has held senior positions in international and
regional investment banking firms as a securities analyst, portfolio manager and director of corporate
finance. Mr. LaKarnafeaux is a principal of the consulting firm, KeyRatios, Inc. which assists early
stage private and public companies in the areas of corporate valuationa nd capital formation. He has
been an active member and officer of regional chapters of the Financial Analyst Society, The
Corporate Finance Council and the American Society of Appraisers.
Previous announcements regarding PAR coverage have been made for AlphaTrade.com (EBNK),
Scottsdale Scientific (STDS), American Alliance (AMRE), MedCare Technologies (MCAR),
CorpHQ, Inc. (COHQ), Crys-Tel Telecommunications (CYSS), Virtuallender.com (VLDC),
Cadapult Graphic (GRFX) Auto Network Group (ANWK), Starnet Communications (SNMM),
BoysToys.com (GRLZ), and Planet City Software, Inc. (PINC).
Contact:
Gerald F. LaKarnafeaux, CFA, 433-688-1986
ratios@infowest.com
or
ALYA International, Inc.
Dale Paruk, 888-528-9982
stock@alya.com
alya.com
or
Investors Research Institute, Inc.
C. Partridge, 212-484-4747
investrend@usa.net
investorsresearch.org
investrend.com |
