Shell Stocks

[neilhk]

PGNF (Paragon Financial, proposed reverse merger/ spin-off of NewMarket Latin America, subsidiary of NewMarket Technology NMKT)

This is a post I put on the PGNF board concerning the proposed reverse merger/ spin-off of NewMarket Latin America, subsidiary of NewMarket Technology NMKT into PGNF,it seems to fit your boards criteria...

Carried out some DD on Newmarket Latin America (currently a subsidiary of NewMarket Technology, NMKT) and the pending spin-off/ reverse merger with PGNF (see PR of 30 November 2006 for detail, http://biz.yahoo.com/bw/061130/20061130005761.html?.v=1

I wanted to find out some more information to estimate the possible share value of PGNF, assuming the RM goes ahead as planned, and to see what the current revenue estimates stated for NMKT as a whole for 2007, could be apportioned to NewMarket Latin America.

If you check out p.14 of the following Report:

http://www.beaconequityresearch.com/report/20061206091121NMKT_ru.pdf

it states that Foreign Operations account for 65.5 % of NMKT total revenues, of which:

NewMarket Latin America (26% of NMKT overall total)

Brazil and Chile (UniOne) = 24%
Venezuela (RKM) = 2%

Newmarket China (36% of NMKT overall total)

Newmarket China and Clipper = 36%
(now trading under IICP following recent reverse merger)

Singapore (Infotel) = 3.5% of NMKT overall total)



NMKT revenue estimates for 2007

NMKT revenue estimates for 2007 are stated as $120 million of which they have estimated that NewMarket China (IICP) will have revenues of c.$40 million

http://biz.yahoo.com/bw/061229/20061229005160.html?.v=1

Based on these figures and assuming that the overall revenue proportion to NMKT of it's overseas business remains approximately the same as above (i.e. 65.5%), then NewMarket Latin America estimates of revenue could be in the region of $31.2 million, calculated as follows:

Overseas Revenues:

$120million x 65.5% = $78.6 million

NewMarket China (now IICP) = $43.15 million
Singapore (Infotel) = $4.17 million
NewMarket Latin America (reverse merger pending with PGNF)= $31.28 million

Net Income for NMKT as a whole is between 5-7%. NewMarket China Operations are currently not profitable, but NMKT as a whole is. NewMarket Latin America has profitable revenues of over $20 million for 2006, as stated in PR of 30 November 2006:

http://biz.yahoo.com/bw/061130/20061130005761.html?.v=1

Therefore, 5% is used as a conservative estimate when calculating net income for NewMarket Latin America:

2006

c.$20 million = $1 million net income
Based on O/S of 150 million (stated as 144 million by the Company, on 30.11.06, but not verified)
EPS = 0.0067
PE 10 = 0.067 pps
PE 20 = 0.134 pps

2007 (estimate)

$31.2 million = $1.56 million net income
Based on an O/S of 150 million (stated as 144 million by the Company, on 30.11.06, but not verified)

EPS= 0.0104
PE 10 = 0.104 pps
PE 20 = 0.208 pps

NMKT have also stated that there could be possible additions to revenue streams (up to $200 million) from aquisition and mergers, as stated in their PR December 13th 2006. This may or may not affect the NewMarket Latin America operations and has therefore, not been taken into consideration at this stage
(see http://biz.yahoo.com/bw/061213/20061213005860.html?.v=1 )

Certainly see multi-bagger potential here for 2007:)

GLTA