Tuesday, November 15, 2005
Earned 2 cents in Q1 and free cash flow matches it. They're probably worth about $1.10 or so. It's selling for $2.02. Overall it doesn't seem like a great business at all.
PLNT, alergy avoidance products (air filters, bedding, etc). 9 full-time employees. They seem to rely on telemarketing. Yuck. Revenues declining 48%. Losing money horribly. Why was this on the list?
PGRA, spatial information management system (that could be anything from astronomical databases to porno). Actually, it's for land analysis, crop management, environmental stuff, military planning, and marketing analysis. Directors and executives own 27.4% of the company. Going concern qualified audit statement by... anonymous auditors? They don't list who they are. I'm sure it must be somewhere.
Weak balance sheet. Wait a minute, this is for the period ending 9/30/2003! They actually filed an NT 10-K earlier in the year. Here's a press release for some later results. They've got cash flow problems. They lost money in 2004. 2005 is supposedly better with higher margin stuff selling more. Revenues declined due to delays in project activity in the US and China (China municipal government had a reorg in one case). They expect to report a very small loss for the 9-months of 2005. It's selling for 1 cent, but this is just too iffy right now.
PHCCA, specialty biopharmaceuticals, and stuff like that to doctors. They have over 5,000 SKUs. That can either be bad or, if the SKUs are all fairly active, it can help retain a niche. Some: PEG-Intron®, Rebetol®, Pegasys®, Copegus®, Remodulin®, Actimmune®, Epogen®, Xolair®, Apokyn™
Revenues have been consistently growing. Gross margins are 11% and are consistent over time. Operating margins are about 4.5%, 5.7% in 2003, 5.0% in 2001. 2004 diluted net earnings of $1.01 were hurt by a 3rd party settlement and restructuring charge. Would have been about $1.14 without them. 2003 earnings were $1.15 (.98 in 2002, .62 in 2001, .65 in 2000). Share count has been very steady over the years.
Strange auditor opinion. Fairly strong balance sheet. Cash flow from ops has been bad for the last 3 years (a little over half of earnings)! Free cash flow is really pretty lousy and getting worse: $6 million in 2004, $10 million in 2003, $12 million in 2002.
In the first half of 2005, they earned 47 cents diluted, but this was on higher revenues with higher SG&A. AR keeps going up. Cash flow from ops is hugely negative due to AR and inventory.
I don't know, maybe it's worth $6? It's selling for ??? There seems to be no symbol, no stock. Apparently, they merged with someone.
PHCO, California worker's compensation HMO type regulated business. Unqualified audit opinion. Strong balance sheet. Low 10% operating margins. Very low tax. $154K 2004 earnings ($58K in 2003). About 16.6 million totally diluted shares. Just under 1 cent per share. Over the past 2 years, free cash flow has been good. Huge loss of $200K in the first half of 2005 due to slightly lower revenues and higher SG&A. Cash flow is about the same. This has eaten away at the balance sheet somewhat.
Workers' compensation costs in California continue to remain excessive which motivates employers to search for ways to control this cost. Although revenues for the six months ended June 30, 2005 fell short versus the same period of 2004, the Company expects to see new growth in the sign-up of MPN customers.... While the Company believes that revenues will increase throughout the next two quarters of 2005, it also believes that expenses will correspondingly increase at a similar rate, which the Company anticipates will result in future increases in income from operations at a rate less than increases in revenue.So this business will continue to suck despite high future revenues. And then there's the risk that the People's Republic of California will somehow confiscate any profits the company might happen to make because it's a soft sector (i.e. bureaucracy rather than a hard sector competing in an unregulated market).