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To
OTC Journal Members:
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Major Breaking
News on Envoy Communications (NASDAQ: ECGI) |
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As promised in our mid week edition,
today is the beginning of what we believe will be a series of very positive
and substantive developments coming out of one of our all time favorite
companies, Envoy Communications (NASDAQ: ECGI).
We have been following Envoy
since July of 1999. The company has delivered everything they promised
during that time frame, but the stock disappointed in the last Bull Market.
We started with this company at about $3, and it found its way to
$10.50 at the high. The way stocks were trading in 1999 and early
2000 we were hoping to see $20. We managed a 300% return
on the stock, and we believe history is about to repeat itself.
Envoy is an international
company, committed to delivering "best-of-breed" services in each of its
core disciplines: design, marketing and technology. Through the convergence
of its core disciplines, Envoy's group of companies provides innovative
business building solutions for marquee international clients that include
Wal-Mart, adidas-Salomon, BASF, CIBC, Castrol, CDNOW, FedEx, Hewlett
Packard, Honda, Panasonic, Pizza Hut, Prudential (USA), Safeway, SalomonSmithBarney,
Sprint Canada, Steelcase, and TD Waterhouse.
In the September quarter Envoy
revenues were $19.2 million, up from $13.8 million the same
quarter of the previous year. EBITDA profits were $2.2 million,
up from $1.875 million the same quarter the previous year.
An analyst at Northern Securities
projects that Envoy will earn about $16.5 million EBITDA in
fiscal 2001 (September year end), which translates to about $.30
per share US. This is without the proposed Leagas Delaney
acquisition, which is scheduled to close before the end of March. If this
acquisition is completed it will double the size of the company overnight.
The company is headquartered in Toronto,
Canada, and its original trading venue is the Toronto Exchange Stock Exchange,
where it trades under the symbol ECG. Last year Envoy made
the jump to a dual listing on the NASDAQ trading under the symbol
ECGI, hoping to catch the eye of US institutional investors. Unfortunately,
the stock began trading on the NASDAQ just prior to the beginning
of the worst Bear market in history.
Envoy retained Merrill
Lynch as its strategic advisor last October with a eye towards
creating a Wall Street following for the stock.
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A
Misconception About the Company |
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The investment community has made
the mistake of categorizing Envoy as an Internet Advertising Company.
This group has been out of favor as a result of the extinction of the "Dot-Com"
business model and numerous failures in that space.
Envoy is not
a "Dot-Com" advertising company. CDNow is the only client they have
which could be considered a "Dot-Com", and their bill is paid. Fully 50%
of the company's revenue stream comes from retail packaging and store design
where their largest client is Wal-Mart (NYSE: WMT).
At $3.50 the market is pricing
Envoy as if it is a "Dot-Com" advertiser with bleak future prospects.
Nothing could be further from the truth. In conversations with senior management
earlier this week we learned business is booming. The investment community's
misconceptions about this company equals major profit opportunity for our
members.
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Friday's
Press Release |
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Yesterday, just after the market
closed, Envoy announced that one of its wholly owned subsidiaries,
Sage Consulting Group, has landed several major new contracts, and
has recently expanded its work force by 15% to handle skyrocketing demand.
We learned that new contracts have
been awarded by The Co-operators Insurance group of Canada, Pitney-Bowes,
and two other companies. The Co-operators is one of Canada's leading
insurance companies with over 40,000 employees.
Furthermore, Envoy announced
the December quarterly results would be released next Thursday, February
8th at 4:30PM Eastern Time, with a conference call to follow. The toll
free number to participate is listed in the press release.
Based on the upbeat tone from management
we would not be surprised if the quarter contains major upside surprises.
We believe Envoy is headed
for $5 in the short term, which would only put the stock back to November's
levels. If the momentum continues we should move higher from there.
Next week- Trading Alert after
the close on Tuesday. Here is the complete text of the press release for
your review.
Friday February 2, 4:00 pm Eastern
Time
Press Release
SOURCE: Envoy Communications Group
Inc.
Envoy Company wins project with
"The Co-operators"
Sage has increased its staff
by fifteen percent to meet demand
TORONTO, Feb. 2 /PRNewswire/ - Geoff
Genovese, CEO of Envoy Communications Group (NASDAQ: ECGI / TSE: ECG) today
announced the Company's wholly owned subsidiary, Sage Information Consultants,
has been awarded a contract to convert The Co-operators General Insurance
Company's (CGIC) enterprise Operating System to Windows 2000. This announcement
comes on the heels of Sage Information Consultants winning three U.S. based
contracts to provide leading application development and infrastructure
solutions to Pitney Bowes (NYSE: PBI - news), The NPD Group and Oxygen
Media. Sage has increased its staff by 15% to service the dramatic increase
in business.
Sage will convert 4000 CGIC users
to Windows 2000. The conversion will provide CGIC with applications, tools
and service capabilities not afforded with their current Operating System.
As the North American leader in infrastructure architecture and design,
Sage will provide the methodology, resources and leadership to guide CGIC
through this project.
``Sage obviously did their homework
and choosing them to lead the planning and analysis phase of our Windows
2000 initiative was a logical outcome,'' said Peter Tingley, I.S. Systems
Services Director for The Co-operators. ``Sage understood our business
needs and, combined with demonstrated migration experience, MS Certification
and a well defined project approach and methodology, they quickly outlined
how we could move ahead with this complex infrastructure undertaking.''
``For a number of years, Sage Information
Consultants has been a key Managed Partner servicing Microsoft Canada's
Enterprise customers. We partner with Sage often because they see the value
in training their staff on Microsoft's products and vision,'' said Frank
Clegg, President of Microsoft Canada.
``This is a great endorsement of
our back-end e-commerce expertise at Sage,'' said Genovese. ``Envoy is
experiencing strong organic growth in each of its core disciplines -- Marketing,
Technology and Design -- a fact which speaks volumes about our convergent
business model.''
About Sage Information Consultants
Inc.
Sage Information Consultants Inc.
(www.sageconsultants.com) is an e-business consulting firm that generates
business value for its clients through leading edge technology solutions.
With offices in Toronto and New York, Sage helps clients to define, architect
and execute their Internet goals by delivering complete solutions including
IT Strategy, Technology Architecture, Development, Deployment/Implementation
and Quality Assurance.
About Envoy
Envoy (www.envoy.to) is an international
company, committed to delivering "best-of-breed" services in each of its
core disciplines: design, marketing and technology. Through the convergence
of its core disciplines, the Envoy Communications Group of companies provides
innovative business building solutions for marquee, international clients
that include adidas-Salomon, BASF, CIBC, Castrol, CDNOW, FedEx, Hewlett
Packard, Honda, Panasonic, Pizza Hut, Prudential (USA), Safeway, SalomonSmithBarney,
Sprint Canada, Steelcase, TD Waterhouse (USA) and Wal-Mart.
Q1 Results Conference Call
Envoy will be hosting a conference
call to announce its first quarter results and other corporate developments
on February 8th, 2001 at 4:30 EST. The call in numbers are as follows:
-
Toronto Area: 416-620-2410
-
All other areas: 877-871-2677 (Toll
Free)
Cautionary Statement
Certain statements contained in this
press release may constitute ``forward-looking statements'' within the
meaning of Section 21E(i)(1) of the United States Securities Exchange Act
of 1934. Such forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause Envoy's actual results to
be materially different from any future results expressed or implied by
these statements. Such factors include the following: general economic
and business conditions, changes in demand for Envoy's services, changes
in competition, the ability of Envoy to integrate acquisitions or complete
future acquisitions, interest rate fluctuations, currency exchange rate
fluctuations, dependence upon and availability of qualified personnel and
changes in government regulation. In light of these and other uncertainties,
the forward-looking statements included in this press release should not
be regarded as a representation by Envoy that Envoy's plans and objectives
will be achieved.
SOURCE: Envoy Communications Group
Inc.
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