Thursday, November 24, 2005
even more companies
JEWLF, make jewelry, incorp British Virgin Islands, revenues hopping around over the years ($19, $23, $26, $22, and 2004 is $28 million). Gross profits have hovered around $5 million (about 20%). Net profits have averaged zero. 2.6 million shares. Cash flow is very bad. They lost a 20% customer in 2004 but managed to do well for the year. The big loss was 2003 due to both dropped sales and high returns, possibly related to the lost customer in 2004. Other than the huge loss in 2003, average earnings are about 8 cents per share.
not interested
JLMC, wholesale bridal gowns, just went dark. Business has been deteriorating rapidly over 3 years. Stock isn't cheap.
not interested
JLWT, freight forwarding, customs, etc. with Asia. 61 employees: half in NY, the rest scattered around the US. Assets are almost entirely AR while liabilities are almost entirely AP (think Charlie Babbitt's car import business in Rain Man). Increasing revenue. Increasing earnings. Earned 1.5 cents in 2004. Might top that in 2005, but not by much. Selling for $1.03.
not interested
JSDA, Jones Soda Co., new age soft drinks. Unqualified audit opinion. Increasing AR and inventory (totally killed cash flow in 2004). Otherwise, balance sheet is fine. 36% revenue growth in 2004. 35% gross margins. 4.6% net margins with no taxes. 21.4 million shares on March 25, 2005. 2 million options outstanding at end of year 2004. Assume 25 million shares totally diluted. Earnings growth was extremely high in 2004. Earned $1.33 million in 2004.
2005: AR and inventories continue to grow. Revenue growth slowing down. Same gross margins of 35%. 9.3% net margins still with no taxes. Still no cash flow due to AR and inventory increases. G&A increased in 2005 causing losses during the first half. Earned what should be about $580K if there were taxes during Q3. If it weren't for the ominous lack of cash flow, the business would be worth $1.40 just based on Q3 numbers, probably more like $2.00. Selling for $5.32. Note: the CFO resigned. Nov 16, 2005, they're going to NASDAQ.
worth following
KBLH, new business, no operations, very skilled at earning interest on a huge pile of cash. Degree of difficulty: 0.00001
not interested
KICH, mortgage loan broker: GSE loans, sub-prime and jumbo loans (non-GSE), commercial.
not interested
KINV, investors including mortgage loans
not interested
KNVA, customer relationship mgmt software. Steadily improving earnings and revenues over the years, hit breakeven in 2005. Odd auditor opinion, but unqualified. New infusion of equity from note conversion. Rock solid balance sheet now. 62% gross margins. Steady fixed costs. Excellent cash flow up to 2005. PP&E humorously depreciated into the dust.
2005: AR increasing. Acquisition of Kanisa. Killed the business for now. This may change after restructuring. Stock is selling for $3.40. 8.74 million shares outstanding on Nov 11, 2005. Assume about 9.75 million shares totally diluted. Market cap would be $33 million, which is about 1 year of revenues.
not interested (but something tells me I might be underestimating them, not sure)
KORH, serial acquirer, 1980s windmill farm (half of them are broken), etc. mortgage, etc.
not interested
KPCG, PR and IR services. Serial acquirer. Anthem Blue Cross, Cablevision, Domino Foods, Jiffy Lube, some others. Unqualified audit opinion. Very weak balance sheet. 6.4% operating margins. Income tax benefit. Maybe 10 cents per share of reliable income (probably less totally diluted). Terrible cash flow. Went dark. I know I looked at this company before. I remember their crappy website and ironic lack of investor relations (being an investor relations business).
not interested
KSCI, frozen Asian foods. 22% gross margins (down from 27% prior year). At net breakeven. Unqualified audit opinion. Weak balance sheet (improving into 2005). The only reason results weren't terrible in 2005 was due to life insurance on CEO.
not interested
LWLL (was KSRE), Don Kirschner's Rock Concert turned K-12 intranet software turned Chinese reverse merger. Shanghai Likang Disinfectant Co., Ltd. Hospital disinfectants. XueLian Bian owns 54.7% (controlling interest). Wei Guan owns 32.8%. All executives and directors own 87.5%. CIK #1042463. Ticker symbol: LWLL.OB
Q3 2005: Balance sheet is ok. 59% gross margins. Net margins killed by "beneficial conversion feature - preferred stock". 49 million shares. Cash flow stinks due to AR. Annual revenues of about $5 million. Revenues increased by 15%. Another 15% would have them earning about 1/2 cent. Stock is selling for 27 cents.
worth following
DND Technologies (yahoo, sec, website) also known as ASI or Aspect Systems is a semiconductor equipment, parts, and services company. Licensing agreements with Lam Research, which I've looked at before, and Axcelis Technologies. ASI is OEMing Lam AutoEtch, Rainbow, and TCP plasma etch systems and others. FYI: Lam's overall gross margins are 49%. DNDT's gross margins are 40%.
DNDT had a net income of $1.24 million in 2004.
If we jump ahead to Q3 2005, they're back to losing money for both the quarter and the year so far in 2005. It's all about timing of purchases by customers and I think this business isn't all that profitable overall. On the plus side, free cash flow is slightly positive so far in 2005 (right around zero if you use depreciation instead of capex).
not interested
not interested
JLMC, wholesale bridal gowns, just went dark. Business has been deteriorating rapidly over 3 years. Stock isn't cheap.
not interested
JLWT, freight forwarding, customs, etc. with Asia. 61 employees: half in NY, the rest scattered around the US. Assets are almost entirely AR while liabilities are almost entirely AP (think Charlie Babbitt's car import business in Rain Man). Increasing revenue. Increasing earnings. Earned 1.5 cents in 2004. Might top that in 2005, but not by much. Selling for $1.03.
not interested
JSDA, Jones Soda Co., new age soft drinks. Unqualified audit opinion. Increasing AR and inventory (totally killed cash flow in 2004). Otherwise, balance sheet is fine. 36% revenue growth in 2004. 35% gross margins. 4.6% net margins with no taxes. 21.4 million shares on March 25, 2005. 2 million options outstanding at end of year 2004. Assume 25 million shares totally diluted. Earnings growth was extremely high in 2004. Earned $1.33 million in 2004.
2005: AR and inventories continue to grow. Revenue growth slowing down. Same gross margins of 35%. 9.3% net margins still with no taxes. Still no cash flow due to AR and inventory increases. G&A increased in 2005 causing losses during the first half. Earned what should be about $580K if there were taxes during Q3. If it weren't for the ominous lack of cash flow, the business would be worth $1.40 just based on Q3 numbers, probably more like $2.00. Selling for $5.32. Note: the CFO resigned. Nov 16, 2005, they're going to NASDAQ.
worth following
KBLH, new business, no operations, very skilled at earning interest on a huge pile of cash. Degree of difficulty: 0.00001
not interested
KICH, mortgage loan broker: GSE loans, sub-prime and jumbo loans (non-GSE), commercial.
not interested
KINV, investors including mortgage loans
not interested
KNVA, customer relationship mgmt software. Steadily improving earnings and revenues over the years, hit breakeven in 2005. Odd auditor opinion, but unqualified. New infusion of equity from note conversion. Rock solid balance sheet now. 62% gross margins. Steady fixed costs. Excellent cash flow up to 2005. PP&E humorously depreciated into the dust.
2005: AR increasing. Acquisition of Kanisa. Killed the business for now. This may change after restructuring. Stock is selling for $3.40. 8.74 million shares outstanding on Nov 11, 2005. Assume about 9.75 million shares totally diluted. Market cap would be $33 million, which is about 1 year of revenues.
not interested (but something tells me I might be underestimating them, not sure)
KORH, serial acquirer, 1980s windmill farm (half of them are broken), etc. mortgage, etc.
not interested
KPCG, PR and IR services. Serial acquirer. Anthem Blue Cross, Cablevision, Domino Foods, Jiffy Lube, some others. Unqualified audit opinion. Very weak balance sheet. 6.4% operating margins. Income tax benefit. Maybe 10 cents per share of reliable income (probably less totally diluted). Terrible cash flow. Went dark. I know I looked at this company before. I remember their crappy website and ironic lack of investor relations (being an investor relations business).
not interested
KSCI, frozen Asian foods. 22% gross margins (down from 27% prior year). At net breakeven. Unqualified audit opinion. Weak balance sheet (improving into 2005). The only reason results weren't terrible in 2005 was due to life insurance on CEO.
not interested
LWLL (was KSRE), Don Kirschner's Rock Concert turned K-12 intranet software turned Chinese reverse merger. Shanghai Likang Disinfectant Co., Ltd. Hospital disinfectants. XueLian Bian owns 54.7% (controlling interest). Wei Guan owns 32.8%. All executives and directors own 87.5%. CIK #1042463. Ticker symbol: LWLL.OB
Q3 2005: Balance sheet is ok. 59% gross margins. Net margins killed by "beneficial conversion feature - preferred stock". 49 million shares. Cash flow stinks due to AR. Annual revenues of about $5 million. Revenues increased by 15%. Another 15% would have them earning about 1/2 cent. Stock is selling for 27 cents.
worth following
DND Technologies (yahoo, sec, website) also known as ASI or Aspect Systems is a semiconductor equipment, parts, and services company. Licensing agreements with Lam Research, which I've looked at before, and Axcelis Technologies. ASI is OEMing Lam AutoEtch, Rainbow, and TCP plasma etch systems and others. FYI: Lam's overall gross margins are 49%. DNDT's gross margins are 40%.
DNDT had a net income of $1.24 million in 2004.
This $3,971,280 increase in net income is primarily the result of a $770,642 decrease (see further discussion under Cost of Revenues-Slow Moving and Obsolete Inventory) in our reserve for slow moving and obsolete inventory, compared to a $2,401,221 increase in our reserve for slow moving and obsolete inventory during 2003, plus an 81% increase in revenue and improved operating efficiencies achieved through a higher level of business activity, offset by an increase in commissions and royalties due to the increased sales for the year ended December 31, 2004.Cash flow from ops was only $917K due to increases in AR and inventories. Depreciation was $180K and capex was $59K.
If we jump ahead to Q3 2005, they're back to losing money for both the quarter and the year so far in 2005. It's all about timing of purchases by customers and I think this business isn't all that profitable overall. On the plus side, free cash flow is slightly positive so far in 2005 (right around zero if you use depreciation instead of capex).
not interested
// posted by Bruce @ 8:55 PM 
