Michael phone call breakdown…
I decided to call back today at lunch hoping I might get lucky and get right through to Michael. He was apparently on the phone when I called but he got back to me less than 10 minutes later.
The first thing I told him was that I’m a large shareholder who has been holding for almost three years. I let him know that I was becoming concerned about the slow progress of the company and that I was calling to find out where Eco-Safe is headed and what the outlook is for 2011. Michael paused for a second and then enthusiastically told me there’s a lot of great things happening and that he’s both “optimistic” and “excited”. So, of course, I asked him why.
Orders
Michael said that he has received quite a few phone calls recently from large companies interested in installing Eco-Safe systems. Specifically he mentioned that two restaurant chains and two supermarket chains (no names given) are seriously talking about installing the systems company wide and that he’s expecting a purchase order from at least one of them in the next week or two. The pending po’s vary in size but he said one should be for over $1 million and another for possibly 5 million. As soon as this happens a press release will be out.
He also mentioned that a large hotel chain in Las Vegas (he said about 18 hotels?) has successfully tested units and is interested in putting systems in every restaurant in every hotel. It would be a pretty big order. I followed this up by asking why there haven’t been more installations in other Cheesecake Factory locations and he told me he actually met with them last week and that they still love the systems and are “aggressively” talking about putting them in more locations. This he also expects to happen fairly soon.
2010 Financials
Michael said they are about halfway through doing the audited financials for 2010. He said they should be done in one to two months. He didn’t speculate on how he thinks they might look.
Patents
I told Michael that I was concerned as a shareholder about the additional 100 mil authorized shares being added. What are they for exactly? This was interesting. He said that some shares are being sold and will be sold to pay for the patenting of new products with patents pending. Currently, they are working with “the best” patent lawyer in Los Angeles to fully patent three of the most complicated products. Because this process is expensive but necessary they are adding shares to the float. He said they are also developing 10-15 other different patents and they need money for that as well. All in all he said he expects 25-30 mil shares to be added to the float.
New Products
There are new products but they won’t be available for 6-9 months due to patenting (I think). One of the products, as mentioned before, was purchased by LA County and is a success. This is probably the septic tank system but he didn’t say. Another product is apparently being tested by the military. Last time I spoke to him (in August) I could have sworn he said the LAPD was testing a new product but this time he said the military. Not sure what the hell the product is but if the military is really interested and the product gets patented I would assume this would be a big deal.
I also asked about the home unit he had mentioned in a previous phone call and he said it’s still in the works and they are currently working on the patent but it’s pretty complicated.
PR
Michael said they do have plans to promote the company but they need at least a half a million for marketing and they are waiting for a couple of big orders to come in first. He reiterated that he “expects” a few big orders to come in soon and at that point they plan to really get the company name out there.
Analysis
Once again, Michael was very friendly and seemingly forthright in talking about the company. He seemed more positive than ever about where Eco-Safe is headed and thinks big orders are imminent. Much of what he said I've heard before (orders are coming), but something does feel a bit different this time. He also seemed genuinely concerned about the share price which wasn't always the case (he said it went to .12 today and I said, "yes, but it closed at .11"). However, since they are selling shares to raise money for patents and other costs, I guess they should be concerned about the share price. One thing I didn't mention though is his belief that in due time the share price will not be pennies but dollars. Yes... dollars. Maybe, but two years ago I told one of my buddies that when ESFS hits $1.00 I would start dancing and wouldn't stop until I literally can't stand up anymore. I haven't started dancing yet, but IF we ever get there I will set up a live internet feed for all to see.
Lastly, he noticed my phone number was local and asked where I was located. I told him I live nearby and that I was interested in visiting the plant if possible. He said I could call anytime and ask for him and he would arrange to show me around. I plan to take him up on this at some point.
Good luck to all and to all a good night. Yawn...
-Pleepleus
P.S. - I apologize for not covering more ground but, well, I'm no expert. That said, I strongly encourage anyone with questions to give Michael a call and ask away. You never know what you'll find out.
