*****Global Diversified Industries, Inc.
(OTCBB: GDVI)
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Global Diversified Industries, Inc.
GDVI Achieves Significant 9 Month Results
Sales Projections for Next 12 Months Surpasses $20 Million
99.8% Revenue Increase
278% Net Income Increase
154% Stockholders Equity Increase
79% Increase In Assets
$8 Million Order Backlog
$50 Million Manufacturing Capacity
Global Diversified Industries, Inc. (OTCBB: GDVI) operates in the modular building construction industry, and strategically targets the California Education Sector. GDVI is strategically located in Central California on 16 acres with a 100,000 square foot state-of-the-art manufacturing facility.
Throughout 2003 and 2004 the company focused on building it’s infrastructure through acquisitions, development of a state-of-the-art manufacturing facility, and by securing the requisite financing facilities to fuel business growth. Previous 9 month revenues of $6.4 million with over a $20 million annual projection for the next 12 months.
Through the combination of its new facility, the increased demand for portable buildings and the State Of California's bond approvals, GDVI has become well positioned to become one of the dominant leaders in modular manufacturing on the west coast.
GDVI should benefit greatly from Proposition 55 (Kindergarten – University Public Education Facilities Bond Act of 2004), the $12.1 Billion school improvement bond that passed in March 2005.
Global Diversified has taken numerous strategic development steps throughout 2004, including generating strong revenues as well as profits and is now poised for explosive growth in 2005. The company is led by a strong management team with previous success in building companies into $50 million per annum businesses.
In the past year GDVI has exceeded its own sales revenue projections, renewed its piggyback contract, received state approvals on engineered product designs, started a new credit facility and opened its new 100,000 square foot manufacturing facility. The company will continue to seek new acquisition candidates through its aggressive growth plan.
Company Subsidiaries
GDVI is a holding company that currently operates three wholly owned subsidiaries, Lutrex Enterprises, Inc., an entity which holds equipment and inventory for the registrant, MBS Construction Inc., a modular contractor specializing in modular construction site work and renovation and Global Modular, Inc., a sales, marketing and manufacturing of modular type structures.
Its principal customer base is currently educational (public and private schools, universities, etc.), child-care and municipality sectors. Its product lines consist of a variety of portable classroom designs, including both single-story and two- story floor plans. Global Modular's portable classroom structures are engineered and constructed in accordance with pre-approved building plans, commonly referred to as "P.C.'s" or "pre-checked" plans, that conform to structural and seismic safety specifications administered by the California Department of State Architects (DSA).
Global Modular also enjoys the benefit of providing educational customers with products contracted under a "piggyback clause". The State of California allows school districts to canvass proposals from modular classroom vendors under a bidding process where the successful bidder can provide other public school districts and municipalities portable classrooms under a "piggyback contract" issued by the originating school district. This process saves school districts valuable time and resources from the necessity of soliciting bids.
A modular vendor who possesses a "piggyback contract" containing competitive pricing and a variety of design options may have access to future business for up to five years, depending on the term of the piggyback contract.
The Strategic Focus on California Schools
Over the last 7 years California legislation has required that at least 20% of all new classrooms constructed with State funds be portable structures.
There are five primary reasons for this trend:
Modular classrooms are FASTER to construct (as quickly as 2 weeks)
They cost significantly less (as low as $30,000 vs. $100,000)
They offer greater flexibility for use compared to conventional buildings
They are easier to finance
They provide financing incentives
To cope with population growth, the State Department of Education estimates that California will need more than 2,500 classrooms each year for the next four years, which equates to more than 10,000 classrooms.
Due to the current and projected budget cuts throughout the California Education Sector, public and private schools are expected to turn to portable/modular construction to fulfill their additional classroom requirements over the next four years.
GDVI is ideally positioned to take advantage of these building trends within the California Education Sector.
Recent GDVI Successes:
Global Diversified Industries' Modular Division Billings Total $1.4 Million in April; Experiencing Largest Production Schedule Since Company's Founding 5/3
Global Diversified Industries, Inc. Modular Division Receives Repeat Order Based on Superior Prior Performance 4/20
GDVI: Modular Division Receives Four New Contracts Valued At More Than $5.1 Million. 4/07
GDVI: Hiring 75 Additional Skilled Factory Laborers To Meet Current and Future Production Demands. 3/31
GDVI: Forecasting Significant Increases in Market Share; Sales Projections for Next 12 Months Now Surpasses $20 Million 3/23
GDVI: Announces Nine Month Revenues Up 99.8 Percent; Backlog Increased to $8 Million 3/17
GDVI: To Acquire Assets of Aurora Modular Industries. 12/07
Recent News Highlights
Global Modular, Inc., has completed its largest production month since the Company first began production in 2003 - May 3, 2005
April's production billings totaled nearly $1.4 million. More than 75% of April's production utilized Global's newly acquired designs from Aurora Modular. All of April's production was for immediate shipment and installation at customers' sites. Because of Global Modular's successes, Global Diversified Industries' other wholly owned subsidiary, MBS Construction, Inc., is also posting record revenues from site installations and other miscellaneous construction work.
Global Modular, Inc. has been awarded a new contract from an existing customer valued at approximately $800,000 based on their satisfaction and positive experience with the quality of the Company's structures and field construction services team. - April 20, 2005
"The significance of this new contract is that we performed well on a $2.8 million contract announced late last year. This Southern California school district expressed its satisfaction and positive experience with the quality of our work. The new $800,000 contract includes classroom, kindergarten and band room facilities utilizing specialty designed engineered components recently acquired by Global Diversified from Aurora Modular Industries," said Chairman and CEO Phil Hamilton.
"We are pleased to have been awarded a contract from a repeat customer since the successful growth of our business is dependent upon repeat orders from satisfied customers," Mr. Hamilton said. "We feel confident our current repertoire of state-of-the-art designs along with an excellent field installation team will mean continued repeat business as we strive to grow our business and value for our shareholders."
Global Diversified also was recently featured in a front page story in The Business Journal, which serves the Fresno, California, area. The article said:
The two subsidiaries of Global Diversified -- MBS Construction, Inc. and Global Modular, Inc. work in tandem to provide customers with modular classrooms.
The Company is currently seeing the heaviest quoting activity since it began operations three years ago.
Global Diversified's new generation of modular buildings is permanent construction, built right on the cement slab, making it just like standard construction.
Mr. Hamilton has pulled together a top-level team of professionals from within the modular industry. Ten of the members of top management have more than 25 years experience each.
The purchase of proprietary rights from Aurora Modular increases the selection of base models from three designs to 12, including two-story designs.
The Company's backlog has grown from $350,000 in April 2004 to $13 million currently.
Global Diversified recently added 25 to its workforce, increasing it to 125, and is now looking to hire 50 highly-skilled workers for its manufacturing plant. It is projecting sales may surpass $20 million in the next 12 months.
