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Monday, May 28, 2007 6:06:12 AM
Broadcast 5/23/07 on WallSt.net:
http://wallst.net/audio/audio.asp?ticker=EFGO&id=3421
Q: Mr. Winters, I understand that there have been a lot of new business developments since you became CEO in January including a name change from CashNow to Esprit Financial Group. Can you give us an overview of the company's operations and core business focus?
Garr: Certainly. We're basically have been a payday loan systems supplier and an operator in the sub-prime industry. When I came back to this company in January of this year I was at the behest of several investors and shareholders who the company had gone through a little bit of a tough time through reorganization and some management desires that really weren't fulfilled and I came back and we took a look at what we had and we have the expertise to provide software to an entire industry. And we were part of the building of that industry going back eight or nine years. So, based on that we said, OK, I have a product that is saleable to the market that needs to be cleaned up a little bit, so that's what I started working on originally. I was able to clean it up and see value there and started looking for other areas that we could really use our expertise and make money with. I found them in several areas. One was, because we had some internet experience, one was Forex trading. We developed a trading platform for Forex traders primarily slanted toward institutional traders and high volume traders, even though we do have some smaller traders using our platform. It is working out well. We're going to move further into the Forex trading through this year and expect to do well there. In the sub-prime market where our customers traditionally have been, there was a need for a very good prepaid card program. So, we went ahead and we bought Global Vision and brought on staff probably the top person in the world in prepaid cards and electronic funds transfer systems, by the name of Jack Chang. Jack is heading up a division that takes care of prepaid cards. Jack notably is a celebrity within our industry in that his name is on the patent for the ATM machine. So, he's really changed the way that people handle money and the way we all use money or get cash from our banking system. A most remarkable individual who's expertise I am able to profit from. I think that he had more creative strength than business strength in his other businesses but, eh, we'll find out. We're able to profit by his participation in our company because he's got some truly phenomenal ideas on how to move money electronically internationally. So, we started to profit from that. Already we've signed some contracts with some major banks and some major financial people. We also have a another area that because of the sub-prime of our consumer base, we've moved into a debt resolution platform where we're going to offer a non-confrontational debt resolution platform for people who owe money to people like banks, finance companies, credit cards, and make it easier for them to make a settlement and to make it to improve their credit rating. That' really where we're sitting right at this moment.
Q: Now I'm interested in the new Forex Division as I understand that this division just launched operations through your website, CashNow.com. What is your outlook for the retail Forex market and could you tell us where you are now and what are plans for sealing up operations?
Garr: Right now, we're an introducing broker for advanced markets and we're moving towards becoming a market brokered dealer. We're in negotiations now and have nearly completed what we feel will be a good acquisition and becoming a brokered dealer in the Forex market. We are on schedule to open up not only our U.S. platform, or North American platform, has been operating since May and is doing well, and we're moving into Europe this month. We'll open in Europe and we will have a full-scale operation going by the end of the third quarter, probably. We expect, although the revenue hasn't been huge to this point, it's very respectable and we think that it will be more than respectable as we move forward.
Q: I understand that the most recent acquisition is Global Vision Holdings which you have just announced that you have sold again. Why the quick reversal?
Garr: Well, what we really wanted was Jack Chang. We liked him so much we bought the company. We happen to be in a pretty good position financially as with many forward thinking individuals who have great ideas and probably the technological background in order to put these ideas forth and can make them work it requires a great deal of funding. I believe that even the giant corporations that Jack has been party with have not given him the financial platform in order to develop fully his ideas. We've taken just a few of them and were able to fund them properly and are seeing the returns on them now. It's very attractive for us. The reason that I flipped it around is I was able to have my cake and eat it, too. I was able to buy the company, get the people and expertise that I needed for our Esprit Financial and then, in turn, sell the shell for a couple of hundred thousand dollars profit. It's a nice deal--I'd like to do that every day.
Q: How are you positioning Esprit within the financial services market? Why should shareholders come on board at this time?
Garr: Well, I think they should come onboard for the basic reason is we have nice, solid products that we're offering to a core (or) niche market--which is the payday loan business. We're upgrading that to take advantage of opening markets. Most of the Western world are users of payday loans and cash advances. Also, so are check cashing and money transfer business. Just a huge market that has been poorly served. We feel that we can serve a portion of that market much better than anybody else at the moment. The growth prospects are just phenomenal! When I started the last quarter of last year this company had lost close to three or four hundred thousand dollars and I was able to cut back on all my expenses, do some acquisitions, generate some needed income on a regular basis. We're sitting with eight or nine hundred thousand dollars in the bank, everything's current, and we have ongoing business that's generating revenues on a daily basis. We're certainly a lot different than what we were just five months ago. Our future is so much brighter--the multiples are staggering. If only a small portion of what we're planning on doing actually happens, the company's values are --it's monstrous! I don't know how else to explain it.
Q: What services will the structured debt resolution concentrate on and does it have any unique factors that will give it an edge in the overall market?
Garr: Well, the main feature is non-confrontational. Many people are really put off by getting a call at dinnertime with somebody calling them about a debt that they owed. With our background in the sub-prime business, we know that many of these people have challenges in taking care of their obligations. In most cases, they have a sincere desire to try and straighten things out. Many times there are financial considerations. There's also problems with being out of work or other situations that have happened. So, everybody needs a better credit rating in order to do what they want to do in life. We hope to be able to provide a nice, easy non-confrontational platform for them to make settlements with the people that they owe money to. On the other end, we hope that some of the creditors will say, you know what, why am I going to keep calling this guy and getting excuses. Let's give him a chance to make an offer to me. They weren't doing before. They were saying, you owe me X number of dollars. Pay it or die. Well, in this case, they have a completely different attitude. Let's try to work together to resolve this situation to both parties benefit.
Q: When can we expect the structured debt resolution division to start operations?
Garr: We expect in the third quarter--third quarter or fourth quarter. It will certainly be up and live this year--this fiscal year. We're actually in beta testing now for the first step. As you can understand, we're really looking for this to be a quite a large venture and because of that, I've been able to utilize some of the systems that we already have in place that work. We're trying to intergrate those into another format which is not always the easiest thing to do, but we're able to do it. I hate to put dates on things, other than sure dates. Since I took over in January, I've been able to hit every single date that I published. So, to be on the safe side, toward the end of the fiscal year. To be optimistic--third quarter.
Q: Overall, at the end of the fiscal year, where do you see the company?
Garr: Hopefully, it will be recognized by the stock price being much higher than it is. I expect to have some money in the bank. I expect to have an expanded operation, all four divisions operating well at a profit. Because I get paid based on stock participation, I got paid my whole year's salary when I started, which was a buck. I expect that I'll be able to start selling a little stock in January or February of next year, because there are restrictions on what I can sell. But, either sell or hold onto it, I'll have an awful lot more money than I have today.
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