October 21, 1999
Dear Readers.
Our segment last week on Madison & Wall Financial Services Inc.’s move to become the first fully integrated publicly traded financial public relations firm generated an electronic mountain of mail. Rather than answer each message individually we’re going to tell you about the trip we made to visit their offices.
After a six hour road-trip, we got the opportunity to sit down and talk with Madison & Wall Financial Services, Inc.’s Chairman and Chief Financial Officer, Jim Schnorf. We asked many of the questions recently posed by our readers. His extremely direct answers provided us a clear view of his company’s progress in the proposed purchase of Continental Capital and Equity. Check out the company report on MWFS in this issue for the details.
We also learned of a company doing exciting things and making a difference in the less developed areas of our world. That company is Engineering Power Systems Limited. Be sure to let us know what you think about this company after you visit their web site. There’s lots of good information and you can get to it directly at http://www.epsx.com or through our ‘featured companies’ page at thestockadvisor.com.
As a bonus for our first-time readers, we're offering a free no-obligation subscription to Investor's Business Daily if you'll complete a very short survey about investing habits. To participate, point your browser to 207.69.237.53, complete the survey and sign up for your free gift.
STOCK TO WATCH: S.W. Lam (OTCBB:CHRM)
Here’s a company to keep an eye on. At last report, earnings were 60 cents per share, with $85 million dollars in annual sales with revenues increasing 40% over last year. They are not listed on the NASDAQ but expect to file in the near future Compare their earnings performance with today’s high-flying internet companies who can’t seem to post any profit. Of course we can’t imagine how 100 shares of this company is the same price as one share of America Online, who we love also!... We couldn’t fit this company’s news into today’s email but you should expect to hear about more about S.W. Lam (OTCBB:CHRM) next week. If you’re the impatient type, follow this link and learn more: http://www.capitalmediagroup.com/client3.htm
COMPANY REPORT - Madison & Wall Financial Services, Inc. (OTCBB: TGRA)
Jim Schnorf, Chairman and Chief Financial Officer for Madison & Wall Financial Services Inc. (MWFS) met with TheStockAdvisor staff and discussed the planned purchase of Continental Capital and Equity Corporation. He had recently returned from a marketing trip where Madison & Wall Financial Services, Inc.’s plan was extremely well received by several investment houses. This enthusiasm surely results from Continental Capital and Equity Corporation’s track record, the fragmented state of the investor relations industry and the circumstances that allow MWFS to benefit from Outlook Sports Technology, Inc.’s net operating loss
Madison & Wall Financial Services, Inc. will be the publicly traded version of Continental Capital & Equity Corporation which is an extremely successful financial public relations firm, in business since 1992. Mr. Schnorf informed us that pre-tax profits through the 3rd quarter of 1999 have surpassed pre-tax profits for the entire previous year. In fact management expects annual profits to be up approximately 40% over last year.
Highlights from our discussion about Continental Capital & Equity Corporation’s performance include:
* Profit margins on core services are currently impressive, improving and expected to improve more over the next several years. Margins: 27% in 1996, 29% in 1997, 32% in 1998 and 35-36% expected this year.
* Client list includes only carefully selected quality companies. They turn down more clients than they accept.
* A new fund is being developed that will allow quality companies who are strapped for cash the opportunity to participate in a manner that will significantly improve margins for MWFS.
COMPANY REPORT - Engineering Power Systems Limited (EPS) (OTCBB: EGPDF)
Have you asked yourself the question, "How do developing countries handle their electricity needs?" No? We hadn't given it much thought either, until the folks at Continental Capital & Equity Corp. suggested we take a look at this interesting and innovative company.
EPS is a vertically integrated independent power developer and a contractor of infrastructure projects. EPS has already secured contracts to supply over 400 megawatts of power to two separate state electricity boards in India for a total project cost of $350 million. In India, towns share power, allowing residents to use their lights only a few times a week. In China some people refuse to buy refrigerators because frequent power shortages make appliances virtually
useless.
"The Indian government estimates that over the next 15 years it must double, perhaps triple it's generating capacity at the cost of up to $400 billion." (Forbes Magazine February 1997)
The World Bank estimated Asia must spend $2 trillion or $4 billion a week by 2004 to meet it's infrastructure needs. It will cost China $20 billion to build new generating plants."
According to the Asian development bank, the economy of Asia is estimated to grow at an annual rate of 6.6% to the year 2000 with a trillion U.S. dollars to be spent on infrastructure projects. Global generation capacity is projected to increase by 885,000 megawatts by the year 2003, 46% to come from Asia. Other countries in a bind for electricity include Indonesia, Sri Lanka, Thailand and Turkey.
EPS can capitalize on these global demands by providing power barges, which can generate up to 200 megawatts of electricity, enough to power an entire city. The power barges can be constructed and ready for operation in 18 months.
EPS not only benefits for every watt used, but also has some interesting financial strategies. For example: EPS shares utility income on a take-or-pay basis contract with a government owned utility electricity board. At the end of a 7-15 year contract, the government electricity board has the option to enter into a new utility supply contract or purchase outright the barge power plant. Like renting with the option to buy!
EPS is comprised of an experienced group of subsidiary companies with the stability of revenue and earnings, and is positioned to benefit from the worlds rapidly growing electricity needs.
Learn more about Engineering Power Systems Limited at http://www.epsx.com
or contact:
Engineering Power Systems Limited
1 First Canadian Place P.O. Box 369, Suite 745 100 King Street West Toronto, ON, M5X 1E2 Tel: 416-861-1484 Fax: 416-364-0618 Email: info@epsx.com
** SPECIAL FEATURE - DINOSAUR DROPPINGS
Dinosaur Investing Philosophy
Taking inventory of the reasons why we invest is a good exercise once in a while. Here is a look at an old dinosaur at work taking an overdo evaluation of my personal reasons for investing. Your reasons may differ. Quite possibly, there are an infinite number of reasons to invest.
My first responsibility is to take care of myself so as not to be a burden on my family, friends, or society in general. Given a tremendous head start by my two grandfathers and my mother and father, given the advantage of living in this country of great wealth and opportunity, and given the good fortune to live in this day and age of breakthroughs and advancements in technology and productivity I am able to meet my daily financial requirements with room to spare. In that room to spare there are a number of doors.
My wife having blessed me with a son and a daughter, I feel compelled to provide sound financial footing for the next branch of the family tree. It is the next generation all that must carry on the forward march of discovery and understanding that has characterized the history of mankind. I view money as a tool for my children to use to week and prune and harvest the orchard that is themselves and this world. The first two areas of my inventory of financial responsibility are rooted in a decidedly self serving bias.
To look beyond the boundaries of self preservation and find a way, in this instance through money, to connect with this world and all of its elements and to be of some service is probably the most difficult and confusing financial task that I have faced. The battle with selfishness and greed is a constant. A noted philosopher once said that in the long term, we will all be one - obviously this truism can wring out some of the need for ownership. the question of whom to trust with our charity is scary. So many jobs to be done. So many holes to be filled. To make a charitable investment in research that might ease the burden of many or to give to individuals or groups in an effort to catch up on the shortcomings of society that have suppressed and oppressed so many. As a friend and teacher of mine says, "It’s a dilemma." Fulfillment comes not from knocking down all the pins, but from taking part. The lane of direct involvement has aided me in personal choices of giving.
Developing a belief in a healthier future for all the world and its inhabitants is a key to giving with conviction and ultimately joy. The financial world has been on a sky high ride for the last seven years, or more. Maybe the next seven years will not be such a cornucopia of financial abundance. My personal philosophy is that we are on an increasingly rapid journey toward a healthier world - financial and otherwise. Whether the Dow is up over the next quarter, year, or decade will not shake this belief. What I am trying to do and advising you to do is to use discipline in saving for a house, for retirement, for your children’s education, and for the improvement of the world in general. Patience and common sense will lead to fulfillment and success in investing and giving in bull or gear markets in this dinosaur’s opinion.
IMPORTANT DISCLAIMER
The TheStockAdvisor is an independent electronic publication providing information on selected public companies. Some companies profiled by TheStockAdvisor pay consideration to TheStockAdvisor for the electronic dissemination of company information and/or web site development. TheStockAdvisor makes no representations, warranties or guarantees as to the accuracy or completeness of the disclosure of the profiled companies. Outlook Sports Technology Inc. has agreed to compensate TheStockAdvisor with $33,000 in a stock/cash transaction to disseminate company information over a period of one year. Capital Media Group has agreed to compensate TheStockAdvisor Inc. with $25,000 in a stock/cash transaction to distribute S. W. Lam company information over a period of one year. Continental Capital and Equity Corporation has paid TheStockAdvisor $15,000 to distribute information about Engineering Power Systems Limited over a period of one year.
TheStockAdvisor is not a registered investment advisor or a broker dealer. TheStockAdvisor advises that the investments in companies profiled are considered to be high risk and use of the information provided is at the investor's sole risk.
TheStockAdvisor also advises that the purchase of such high risk securities may result in the loss of some or all of the investment. The information provided on the profiled companies may include information from outside sources and interviews conducted by TheStockAdvisor. Investors should not rely solely on the information presented here. Rather, investors should use the information provided by the profiled companies as a starting point for doing additional independent research on the profiled companies in order to allow the investor to form his or her own opinion regarding investing in the profiled companies. Statements made on the profiled companies are made as of the date made and are subject to change without notice. The receipt of this information shall not create, under any circumstances, any implication that there has been no change in the affairs of the company profiled since the date of review. Investing in small-cap securities is highly speculative and carries an extremely high degree of risk. It
is possible that an investor's entire investment may be lost or impaired due to the speculative nature of the companies profiled. TheStockAdvisor makes no recommendation that the securities of the companies profiled should be purchased, sold or held by individuals or entities that learn of the profiled companies.
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