NNRF Inc (NNRI)

[stocktiger]

Dilution is often not a reality and misunderstood

Generally dilution is the same amount of income but more shares so the income per share is diluted. Example would be if a company had to issue new shares to raise money to build new offices. In the short term at least this would not add to earning so would dilute the current earnings.

If a company issues more shares yet increases the income sufficiently to increase its income per share (including the new shares) it is called accretive.

NNRF had small income at the time it paid $2,165,000 in cash and four million shares of common stock to buy 50% of ATOLL.
Well ATOLL in the last quarter reported a margin of 26%. They have a sales book now of about 200M so if they keep the same margin that would be $62M in gross profits and half to NNRF. This is only an example but you can see that even if they had to issue new shares it sure would not have been dilution but accretive.

NNRF now has 3 acquisitions on the table and all of these companies are making money so I believe they also will all be accretive to earnings per share and not dilutive.

The reason a company goes public is to be able to use shares to expand. ORCL has 5 billion shares MSFT has 9 billion. Both companies used shares to buy other companies so they could grow and increase earning and shareholder value.

So more shares if used properly, like they were in the case of buying ATOLL, is exactly what shareholders want as that is real wealth building.

It has another value also and that is to increase the float as when NNRF gets listed on the AMEX and AIM and perhaps other exchanges it will surely have to have more floating shares for larger funds and other institutions to take good sized positions in the company.

We also well know that ATOMPROM is on an acquisition hunt to buy up as many companies it can to put under its umbrella. It seems to me that at some point owning many companies in the nuclear field will put NNRF in a very good position in more ways than one.