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Friday, February 10, 2006

revisiting companies 9

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revisiting companies 8

DYHP (sec) Stock is down to 48 cents (from 70 cents). Q3 results: They're sitting on derivatives (a liability on the balance sheet). Revenues jumped into gear vs 2004, but are down from Q2. Less than 10% gross margins. Negative cash flow from ops, losing money and would have been losing more if not for the decrease in the derivatives.
stop following

DTGLF (sec) Stock is down to 17 cents. Assets are goodwill, AR, PP&E, and inventories. Balance sheet is fair. Losing money, large fixed expenses. Negative cash flow from ops.
stop following

FAME (sec website) Stock is at $4.70. They sell flame-retardant coatings and sealants. Flamemaster. They went dark. Most recent SEC results are for Q1 2005. Their website has full year results: For the year ending Sept 30, 2005, revenues and earnings are up over prior year. They apparently earned 51 cents diluted for the year. Prior year was 43 cents.

CITY (sec website) Stock is about the same at $1.85. Going dark. Q3 financial report. AR increased. Current ratio still strong at 2. Way too leveraged. Operating margin 4.2%. Gain from discontinued operations. I'd put normal diluted earnings for Q3 at around 9 cents. Nine month earnings are about 18 cents. Let's say full year earnings might be 25 cents. At a P/E of 15, the stock would be $3.75. Cash flow looks good. Normal operating free cash flow is above net income.
stop following

BGII (website)
Looking at the Q3 results, lots more cash on the balance sheet. Very good current ratio. Earned 3 cents diluted in Q3. Free cash flow is way above earnings. The problem is that they're no longer a reporting company and they've chosen not to have audited results.
stop following

GACF (sec) Stock is at $1.53. They dismissed the auditor and hired another. They're in the airplane repair business. Balance sheet is fair. Operational margins are 22%. Net margin is 4%. They [really] earned 1.5 cents per diluted share in Q3 but the share count has grown quite a bit. Cash flow from ops is crappy due to inventories and a non-cash gain from renegotiation (the 1.5 cents per share doesn't include it). So perhaps the stock is worth 90 cents.

GBEL (sec) Stuggling recycle business has too much SG&A costs to support it. Loses money too often.
stop following

GARM (sec) Stock is under 4 cents. They spun-off Scrap China. Q3: Not much equity, but the balance sheet isn't all that bad. Horrible margins.
stop following

DAAT (sec) In this press release, they announce an annual 45% increase in sales, but with some bad news about re-orders from Wal*Mart due to a glitch. This is the gun cleaning kit business. Praetorian Capital Management bought more shares and now owns 11% of the stock.

Q3 results: Balance sheet is a bit ugly with too much inventory.

9 Months: Sales were up 51% at this time. Gross profit up 41%. Operating income up 61%. Net income up 27% to 10 cents a diluted share. 3 month net income was 5 cents.

Cash flow from ops was terrible due to inventories (for both 3 and 9 months).

Stock isn't cheap.

DAOU (sec) Merged into Proxicom, Inc.
stop following

DDSI (sec) I had flagged it as no good before and Q3 is no better.
stop following

DEWY (sec) Stock is up to $4.75. Strong balance sheet. Revenues down slightly. Cost of revenues up slightly. Operating loss. Net loss. Last year's Q3 was earning 4 cents, now they're losing 4 cents. Cash flow from ops is worse due to AP. No definitive reason (lower production efforts towards various orders for replacement parts, also less profitable product mix). The backlog is down quite a bit.

They were in the process of selling 68 unused acres of seemingly industrial land near an Interstate exchange in Bergen, NJ. This fell through. They'll continue to look for a buyer.

Government defense generator orders have declined (the US Army has enough of them and so purchasing is slowing down to replacement rates). There's also a competitor with a quieter and larger generator, but it is largely in another market. Other stuff increased, but not enough. They have some R&D contracts from 2003 and 2004.

Overall, it seems like somewhat of a hard scrabble business.

DFNS (sec) Stock is largely unchaged at 37 cents. Body armor, car armor, etc. They have a prospectus out for 3.9 million shares. Q3: Balance sheet is ok, but lots of AR and inventories. About half equity. Revenues way down over prior year. Profit down to only 1/3. Operating loss for the quarter. Cash flow from ops is good, but huge capex wipes it all out.

The recently discovered problems with Zylon based bullet proof vests are probably beneficial to DFNS since they don't use it. But their sales dropped along with general industry declines.
Revenues:          2005     2004
Civilian $907K $655K
Israeli military $580K $359K
Export military $505K $2,167K
The export military revenues going forward are difficult to predict. Gross margins are likely to drop even more due to raw material costs going up.

The company had some operations in Gaza that were abandoned. Cost was $217K. They will probably be reimbursed (would be a gain). No doubt, the honest and hard working Palistinians will make productive use of the building for creating great economic wealth. Jimmy Carter said so.

25 million shares on Nov 14, 2005. Another 1.8 million shares are waiting to be distributed. It's difficult to value the business right now.

DNII (sec) Stock's last sale was 5 shares for a penny. The company went dark in March 2005. Can't seem to find the company (the correct one, at least).
stop following

DSCI (sec) Stock is up to about 60 cents. Bandages, wound closure, fasteners, skin care. They accelerated the vesting of stock options to avoid having to expense them, and they even admit it blatantly.

Assets are mostly inventories and PP&E. Current ratio is 2. About 2/3 equity.

35% gross margins. Slightly positive operating margins (but improved over losses). Cash flow is about 11% of revenues due to huge provisions for bad debt and rebates. Also a large decline in inventories. Low capex. Paid off some debt.

12.3 million shares on Sept 30, 2005. Without looking closely, seems like about 6 million options and warrants to be fully diluted, so assume 18 million fully diluted shares for now. A rough guess is that the stock is selling at full value.

DYNR The stock last traded in Nov 2005 at around 24 cents. Gold mining stock. No SEC filings since 2000. Last audited results were 2001. They registered with the SEC (here and here) in April and May of 2000. But when the SEC told them they needed to file additional audited disclosures, they withdrew their registration. Seems a bit too suspicious, especially for a mine ("hole in the ground owned by a liar"). But let's look at what they've got just out of curiousity.

Their website has annual financials.

2004: Balance sheet is very strong. $368K PP&E, with $100K depreciation. Gross margins are over 50%. Net margins are 33%. Revenues $2.2 million. Net income $726K. 6.8 million shares on Dec 31, 2004 (typo in document). 983K options and 80K warrants. 7.88 million totally diluted shares. 2004 net income is 9.2 cents totally diluted.

2004 equity per totally diluted share: 79 cents
2004 net cash + AR + inventory per totally diluted share: 14 cents (all inventory was sold off in Q1 2005)

2003: Net income was only $69K
2002: Net loss of $407K
2001: Net loss of $305K

This post in memory of Wu Xianghu of Taizhou, China

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