Tuesday, June 25, 2013 11:55:19 AM
Interesting ILED Article from Seeking Alpha
http://seekingalpha.com/instablog/9577991-dwdallam/1982232-evolucia-is-set-to-become-the-world-s-leading-led-technologyhttp://seekingalpha.com/instablog/9577991-dwdallam/1982232-evolucia-is-set-to-become-the-world-s-leading-led-technology
Evolucia Is Set To Become The World's Leading LED Technology 2 comments
Jun 24, 2013 9:21 PM | about stocks: ILED.OB, RVLT
As traders and investors, one thing we dislike about searching for the next Bubba Gump is reading about it one day before its assumed ignition. That doesn't give us any due diligence margin, and leaves us with two options: Act like herd animals and get slaughtered, or sit on the sidelines and watch Bubba Gump reach high orbit above Wall Street-and cry ourselves to sleep every night. For traders and investors alike, neither option is desirable.
In view of that, I've decided to divulge my research far before that time. In fact, I would suggest not buying Evolucia (ILED.OB) in the short term. Evolucia's float is 1 Billion shares, trading currently at .02 cents. That sounds worse than it actually is, however. I don't know what Evolucia's average float is but let's say it's 25 cents (which is generous, given that since 2009 the price was .10 and has declined to .02 cents since 2011, and they went public in late 2007). At 25 cents a share, that would equal 250M in total float. That's not so bad, really, as a buy back of 125M would reduce float by 50%. Another option is a reverse split, which wouldn't cost the company anything.
In either event, take the time between now and when Evolucia plausibly climbs to the heavens to familiarize yourself with the company: Read a few technical papers on general LED technology, read Evolucia's white paper on their patented LED technology called "Aimed Optics," and become intimate with ILED's stellar management team.
There has been a fair amount of noise about value LED companies lately. Some articles are bullish on these small and micro cap companies and some bearish, all for various reasons. Since I've never been one to follow crowds, deciding which LED value company to follow and perhaps leverage into is based on two key question: (1) Which company has the best technology? and (2) Which company has the greatest chance of marketing that technology to its customer base? The importance of the second question is obvious, but for many, the technology behind a company is of less concern.
In the case of LED markets, weighing technology lighter than marketing is an extremely unfortunate oversight for one key reason: The very existence of LED markets rests on the necessary condition of efficiency. That is, if it weren't for efficiency, there would be no reason to replace, for instance, High Pressure Sodium lamps, those yellow orbs of light familiarly called "street lights" nor the now ubiquitous fluorescent-both of which are a very large targets for LED manufacturers. In fact, LED can eventually replace both technologies indoors and outdoors, but, again, only if LED technology is necessarily more efficient. In other words, ignoring LED energy efficiency is to investors as ignoring wolves is to sheep.
That being the case, efficiency translates backward to technology and forward to the bottom line of commercial customers. Commercial is the operative word here. The consumer market is vastly more unpredictable in that it is highly susceptible to marketing, rather than superior technology (remember the BETAMax by Sony?). That's because consumers are generally ignorant of the technology they buy, buying whatever is cheapest and available when they need it, and in whatever packaging catches their eye. As such, consumer marketing will make or break a company, including a consumer LED lighting company.
Commercial marketing is a different animal. Commercial customers are not ignorant of the technology in which they invest, and, in fact, are going to buy the product with the greatest return on their investment. Therefore, all things being equal, commercially oriented buyers are going to invest in the most efficient-superior-technology. Furthermore, all things being equal, the company with superior technology is more fit to survive as a dominate player in the LED market; and, ipso facto, the entity with superior technology has the best chance of being The dominate player.
So, what company is positioned to dominate in the commercial LED marketplace based on superior technology? My conclusion is Evolucia because has developed and patented the most efficient lighting in the industry.*
The meat of my investigation gravitated around several key questions:
What is Evolucia going to do about its share price?
How is Evolucia's technology compared to its competitors?
Why has Evolucia lagged behind its competition in marketing and sales?
How does Evolucia's new leadership contribute to Evolucia moving forward?
Is Evolucia more industrial oriented or consumer oriented?
I posed those questions to Evolucia's Craig Hall over the phone and in email. I'll number his answers as my questions are numbered above (Note: Unless directly quoted, all information is paraphrased):
On April 30th, 2013, Evolucia's CEO announced that it would be trading on NASDAQ within twelve months. At this time, Evolucia has put stock concerns on the very back burner, but the NASDAQ deadline persists. The reason the NASDAQ listing along with general stock concerns are on the very back burner is that Evolucia is leveraging all of its resources at global marketing, distribution, and manufacturing, with the goal of European, South American, Asian, Australian, and North American manufacturing and distribution locations. This is important because it cuts time to market, international tariffs, customs, and other logistic problems.
Our closest competitor is Revolution (RVLT). "My understanding is that RVLT is commercially focused, but primarily indoor lighting. Evolucia is commercially focused (originally in the outdoor lighting space), but we have transitioned to encompass indoor as well with our acquisition of Affineon Lighting. I can't speak to RVLT's technology, but I can say that in the outdoor lighting space (roadway lighting, parking lots, etc.) that Evolucia's Aimed Optics allows for the highest efficiencies in the industry. . .and our technology outperforms theirs specifically in the outdoor space."* Evolucia's technology rests on the "Aimed Optics" patents. Over $30 million of investment has gone in making Evolucia's technology the most efficient technology in LED lighting.
As stated in #1, that was due to focusing on technology and a low IQ in marketing. Since then, Evolucia has hired two former executives from OSRAM (Sylvania), one in the position of CEO, and an entirely new and extremely experienced management team.
Evolucia's new CEO and one of its Board of Directors are both from OSRAM (Sylvania) and have agreements with OSRAM Mexico to sell ILED technology exclusively in Mexico, as one example. Final agreements to move into Europe with the Polish investment consortium for exclusive manufacturing and distribution rights serving Western and Eastern Europe have been finalized. Also, Evolucia has now formed a subsidiary in Australia to market and manufacture Evolucia products in both Australia and New Zealand. Evolucia has finalized a partnerships with Leader Electronics for all of Asia, and has acquired Affineon Lighting, which will move us to indoor lighting. Last, Evolucia is now a "pure play" commercial LED lighting company.
So, all of that sounds dandy and gets the old stock market blood pumping because it's exactly what Bubbba Gump investors want to hear, right? In order to avoid the slaughter house, however, we need a liberal dose of skepticism and research in order to decide if these partnerships, acquisitions, contracts, and awards can deliver concrete results for Evolucia's future survival and market dominance. (Note that while doing your own due diligence, you may come across older information where Evolucia seems to be connected with Sonovia. Sonovia is Evolucia's old name.)
__
BOARD OF DIRECTORS
Mel Interiano (CEO) is an accomplished lighting industry veteran. He worked for OSRAM SYLVANIA (the lighting division of SIEMENS) for 15 years. Mel was in charge of all international sales for OSRAM SYLVANIA where in just a few months, he broke sales records and created innovative business models for LED sales. More information: http://www.evolucialighting.com/about/leadership
Charles B. Rockwood (EVP) is Evolucia's Executive Vice President and Chief Financial Officer. Charles brings 25 years of financial and operational experience to Evolucia and has held CFO, COO and CEO positions with responsibilities that include financial management, mergers and acquisitions, business development, fulfillment, legal and compliance.
Francis (Frank) J. Santiago is recently retired from OSRAM Sylvania as Executive Vice President & Global Head of Sales and joined the Evolucia Inc. Board of Directors in 2012. He has held senior-level and general management roles at Osram Sylvania Inc. More information: origin-www.bloomberg.com/apps/news
Skip Sack joined the Evolucia Inc. Board of Directors in 2012. He currently serves on the Boards of six private companies, one public company and four non-profits, and is the former Chairman of the Board of the National Restaurant Association. He also serves on the Cornell University Council and Dean's Advisory Board of the Hotel School. Skip joins the Board with 50 years of experience in the restaurant and hospitality industry. Up until 2007, he was a member of the Applebee's Board of Directors. More information: http://www.evolucialighting.com/about/leadership
Tom Siegfried has been a member of Evolucia's Board of Directors since 2010. He retired after a 25 year career in commercial and government new construction, renovation and historical restoration in the Washington D.C. area. Before retiring, he was a principal in a national construction company that specializes in governmental and municipal contracts. More information: www.evolucialighting.com/about/leadership
Woody Smith has 35 years of lighting experience in design and implementation of lighting systems. He has held the following positions: Director R&D High End Systems (USA), COO Martin Professional*,(Denmark), International Sales Coemar SpA (Italy), VP Engineering Hubbell Lighting, Founder Affineon Lighting, CTO Evolucia. More information: http://www.evolucialighting.com/about/leadership
__
PARTNERSHIPS
SYLVANIA
Actually, Sylvania hasn't really existed since 1993 when it was sold by its then current owner GTE. Since then, Sylvania was absorbed by three companies, OSRAM, Havells, and spun off as an independent in Australia.
OSRAM
There is no doubt about OSRAM as a "real deal" player, as it is a subsidiary of Siemens itself. You can do your own fundamentals on OSRAM if you wish, but suffice to say, OSRAM is a multi-billion dollar internationally entrenched company. It's been around since 1919.
OSRAM SYLVANIA is the North American business of OSRAM AG of Germany, one of the world's largest manufacturers and part of the Siemens family of companies. The company manufactures and markets a wide range of lighting products for business and industry, consumers, for the automotive industry, and for the computer, aerospace and other major industries worldwide. It employs about 11,200 people in North America and is headquartered in Danvers, MA.
OSRAM SYLVANIA has 22 manufacturing plants, one equipment assembly operation and twelve research and development laboratories, along with a network of sales offices and distribution centers serving all of the United States, Canada, Puerto Rico and Mexico. Most of the company's products are marketed in North and South America under the SYLVANIA or OSRAM brand name. OSRAM, headquartered in Munich, Germany, has over 35,000 employees and 53 production plants in 18 countries around the world. Over the last 10 years, this leading products company has gradually expanded its international presence while tripling sales and doubling its world market share.
The global headquarters for Siemens also is in Munich, Germany, while the company's North American headquarters is in New York City. Siemens does business in the world electrical and electronics market. In addition to , some of the Siemens business groups are: communication and information systems; electric components; automotive and transportation; energy and power generation; medical electronics; and automation. Worldwide, Siemens has 426,000 employees in over 190 countries. (Source: http://www.sylvania.com/en-us/about/Pages/company-profile.aspx )
OSRAM Mexico
This is Evolucia's doorway into Mexico whereby OSRAM Mexico have agreed to further develop the Evolucia Aimed Optics technology, and to market it. (Source; http://www.prnewswire.com/news-releases/osram-mexico-and-evolucia-inc-announce-led-outdoor-luminaire-co-marketing-agreement-190839371.html )
Poland
This is a deal with a Polish entity to create Evolucia Europe. The deal is finalized and for the rights to manufacture and distribute Evolucia products in Europe, the Polish entity will pay Evolucia 11 million by August. (Source: http://www.reuters.com/article/2013/03/20/fl-evolucia-in-europe-idUSnPnCL80404+160+PRN20130320 ) Deals fall through, so watch this for movement.
Here is additional and specific information about the Polish partnership from an email with Evolucia's Craig Hall:
In 2008, SETE [Evolucia's Polish partner] identified LED lighting as an ideal and rapidly growing product offering for government sales. The reason they selected us at that time was because: (1) we had developed a proprietary high quality Aimed Optics prototype that was more efficient than any other product in the market; (2) we were one of the original companies to identify commercial outdoor and street lighting as a target market which is/was a nice fit into both municipal and federal channels; and (3) one of our significant investors is from Poland, and had relationships with this group.
Over the last 4+ years, we licensed our trademarks (Sunovia, Evolucia, Aimed optics, etc.) to this group, and allowed them to operate independently within Poland as Sunovia Energy Technology, Inc. (our former corporate name) to develop distribution channels into the government and military markets for our products. As you can read from their website (sunoviaeurope.com), they piggy-backed our penetration of military bases and national awards with similar achievements in Poland/Europe.
They used their relationships to establish numerous test sites for our street lights, including sites in Radom and Krakow, Poland. The test results have been unanimously positive, and the distribution channels are expected to grow exponentially over the coming months and years.
As a result of the successful tests, this group came back to us requesting the rights to manufacture our products (rather than just purchase) in Poland for distribution into the European markets. We sold them these rights for $11 million, with the caveat that Evolucia, Inc. would have to own a controlling interest in the distribution entity; while the investment group would be allowed to own 100% of the manufacturing company. The agreement requires that they meet quality and favored nations pricing requirements.
Australian Subsidiary
Evolucia LDU Pty Limited, a wholly-owned Australian subsidiary of the Sarasota, Florida-based Evolucia Inc. You can also find this information on the Evolucia website, but I always like to triple check anything found on a company website. Call Evolucia to get more information about how far along this venture is. (Source: http://www.manmonthly.com.au/news/us-lighting-manufacturer-evolucia-sets-up-in-hobar)
Leader Electronics
Leader is a large Asian company and the exclusive partner taking Evolucia to Asia. (Source: http://www.prnewswire.com/news-releases/sunovia-energy-finalizes-partnership-with-leader-electronics-162865966.html). Leader Electronics website: http://leaderen.syis.com.tw/default.aspx
__
AQUISITIONS
Affineon Lighting
This is a product expansion effort for indoor lighting. (http://www.prnewswire.com/news-releases/evolucia-to-acquire-affineon-digital-lighting-204087281.html )
__
AWARDS AND CASE STUDY CONTRACTS
*US Department of Energy
Evolucia's LED Cobra Head SCHX5 was given the award for Best Outdoor Street Light, in its class, by the U.S. Department of Energy (DOE). . . ." (Source: http://seekingalpha.com/instablog/200555-qualitystocks/170330-sunovia-energy-technologies-inc-sunv-evolucia-cobra-head-wins-lighting-industry-s-top-award )
*Military
The U.S. Navy has successfully installed Evolucia Aimed LED cobra head street lights at the Souda Bay base in Crete, Greece.
( Source: http://www.prnewswire.com/news-releases/us-navy-installs-evolucia-aimed-led-lights-on-base-in-greece-104289453.html )
Fort Buckley, CO
(Source; http://www.bizjournals.com/prnewswire/press_releases/2011/05/18/FL03940 )
Camp Lejeune, N.C.
(Source: http://www.prnewswire.com/news-releases/marines-get-better-outdoor-light-and-cut-electricity-by-half-at-camp-lejeune-78222502.html)
*Commercial
Appalachian State and De Paul University
(Source: www.prnewswire.com/news-releases/universities-find-evolucia-led-parking-fixtures-enlightening-176610181.html)
As always, most things in life are based on conditionals, and that is how I will conclude my analysis of the next possible Bubba Gump of the LED market. If Evolucia's technology is as good as it seems (awards and commercial contracts point to that conclusion); and if the new management team, two of which are from OSRAM Sylvania, including the CEO, continue their successes into OSRAM markets as they have done in Mexico, along with their European, Asian, and Australian ventures; and finally, if Evolicia's technology continues to be superior, then Evolucia is set to become The definitive commercial international LED company. Commercial customers will buy technology that realizes the greatest return on their investment. Today, that technology is Evolucia's.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.Evolucia Is Set To Become The World's Leading LED Technology 2 comments
Jun 24, 2013 9:21 PM | about stocks: ILED.OB, RVLT
As traders and investors, one thing we dislike about searching for the next Bubba Gump is reading about it one day before its assumed ignition. That doesn't give us any due diligence margin, and leaves us with two options: Act like herd animals and get slaughtered, or sit on the sidelines and watch Bubba Gump reach high orbit above Wall Street-and cry ourselves to sleep every night. For traders and investors alike, neither option is desirable.
In view of that, I've decided to divulge my research far before that time. In fact, I would suggest not buying Evolucia (ILED.OB) in the short term. Evolucia's float is 1 Billion shares, trading currently at .02 cents. That sounds worse than it actually is, however. I don't know what Evolucia's average float is but let's say it's 25 cents (which is generous, given that since 2009 the price was .10 and has declined to .02 cents since 2011, and they went public in late 2007). At 25 cents a share, that would equal 250M in total float. That's not so bad, really, as a buy back of 125M would reduce float by 50%. Another option is a reverse split, which wouldn't cost the company anything.
In either event, take the time between now and when Evolucia plausibly climbs to the heavens to familiarize yourself with the company: Read a few technical papers on general LED technology, read Evolucia's white paper on their patented LED technology called "Aimed Optics," and become intimate with ILED's stellar management team.
There has been a fair amount of noise about value LED companies lately. Some articles are bullish on these small and micro cap companies and some bearish, all for various reasons. Since I've never been one to follow crowds, deciding which LED value company to follow and perhaps leverage into is based on two key question: (1) Which company has the best technology? and (2) Which company has the greatest chance of marketing that technology to its customer base? The importance of the second question is obvious, but for many, the technology behind a company is of less concern.
In the case of LED markets, weighing technology lighter than marketing is an extremely unfortunate oversight for one key reason: The very existence of LED markets rests on the necessary condition of efficiency. That is, if it weren't for efficiency, there would be no reason to replace, for instance, High Pressure Sodium lamps, those yellow orbs of light familiarly called "street lights" nor the now ubiquitous fluorescent-both of which are a very large targets for LED manufacturers. In fact, LED can eventually replace both technologies indoors and outdoors, but, again, only if LED technology is necessarily more efficient. In other words, ignoring LED energy efficiency is to investors as ignoring wolves is to sheep.
That being the case, efficiency translates backward to technology and forward to the bottom line of commercial customers. Commercial is the operative word here. The consumer market is vastly more unpredictable in that it is highly susceptible to marketing, rather than superior technology (remember the BETAMax by Sony?). That's because consumers are generally ignorant of the technology they buy, buying whatever is cheapest and available when they need it, and in whatever packaging catches their eye. As such, consumer marketing will make or break a company, including a consumer LED lighting company.
Commercial marketing is a different animal. Commercial customers are not ignorant of the technology in which they invest, and, in fact, are going to buy the product with the greatest return on their investment. Therefore, all things being equal, commercially oriented buyers are going to invest in the most efficient-superior-technology. Furthermore, all things being equal, the company with superior technology is more fit to survive as a dominate player in the LED market; and, ipso facto, the entity with superior technology has the best chance of being The dominate player.
So, what company is positioned to dominate in the commercial LED marketplace based on superior technology? My conclusion is Evolucia because has developed and patented the most efficient lighting in the industry.*
The meat of my investigation gravitated around several key questions:
What is Evolucia going to do about its share price?
How is Evolucia's technology compared to its competitors?
Why has Evolucia lagged behind its competition in marketing and sales?
How does Evolucia's new leadership contribute to Evolucia moving forward?
Is Evolucia more industrial oriented or consumer oriented?
I posed those questions to Evolucia's Craig Hall over the phone and in email. I'll number his answers as my questions are numbered above (Note: Unless directly quoted, all information is paraphrased):
On April 30th, 2013, Evolucia's CEO announced that it would be trading on NASDAQ within twelve months. At this time, Evolucia has put stock concerns on the very back burner, but the NASDAQ deadline persists. The reason the NASDAQ listing along with general stock concerns are on the very back burner is that Evolucia is leveraging all of its resources at global marketing, distribution, and manufacturing, with the goal of European, South American, Asian, Australian, and North American manufacturing and distribution locations. This is important because it cuts time to market, international tariffs, customs, and other logistic problems.
Our closest competitor is Revolution (RVLT). "My understanding is that RVLT is commercially focused, but primarily indoor lighting. Evolucia is commercially focused (originally in the outdoor lighting space), but we have transitioned to encompass indoor as well with our acquisition of Affineon Lighting. I can't speak to RVLT's technology, but I can say that in the outdoor lighting space (roadway lighting, parking lots, etc.) that Evolucia's Aimed Optics allows for the highest efficiencies in the industry. . .and our technology outperforms theirs specifically in the outdoor space."* Evolucia's technology rests on the "Aimed Optics" patents. Over $30 million of investment has gone in making Evolucia's technology the most efficient technology in LED lighting.
As stated in #1, that was due to focusing on technology and a low IQ in marketing. Since then, Evolucia has hired two former executives from OSRAM (Sylvania), one in the position of CEO, and an entirely new and extremely experienced management team.
Evolucia's new CEO and one of its Board of Directors are both from OSRAM (Sylvania) and have agreements with OSRAM Mexico to sell ILED technology exclusively in Mexico, as one example. Final agreements to move into Europe with the Polish investment consortium for exclusive manufacturing and distribution rights serving Western and Eastern Europe have been finalized. Also, Evolucia has now formed a subsidiary in Australia to market and manufacture Evolucia products in both Australia and New Zealand. Evolucia has finalized a partnerships with Leader Electronics for all of Asia, and has acquired Affineon Lighting, which will move us to indoor lighting. Last, Evolucia is now a "pure play" commercial LED lighting company.
So, all of that sounds dandy and gets the old stock market blood pumping because it's exactly what Bubbba Gump investors want to hear, right? In order to avoid the slaughter house, however, we need a liberal dose of skepticism and research in order to decide if these partnerships, acquisitions, contracts, and awards can deliver concrete results for Evolucia's future survival and market dominance. (Note that while doing your own due diligence, you may come across older information where Evolucia seems to be connected with Sonovia. Sonovia is Evolucia's old name.)
__
BOARD OF DIRECTORS
Mel Interiano (CEO) is an accomplished lighting industry veteran. He worked for OSRAM SYLVANIA (the lighting division of SIEMENS) for 15 years. Mel was in charge of all international sales for OSRAM SYLVANIA where in just a few months, he broke sales records and created innovative business models for LED sales. More information: http://www.evolucialighting.com/about/leadership
Charles B. Rockwood (EVP) is Evolucia's Executive Vice President and Chief Financial Officer. Charles brings 25 years of financial and operational experience to Evolucia and has held CFO, COO and CEO positions with responsibilities that include financial management, mergers and acquisitions, business development, fulfillment, legal and compliance.
Francis (Frank) J. Santiago is recently retired from OSRAM Sylvania as Executive Vice President & Global Head of Sales and joined the Evolucia Inc. Board of Directors in 2012. He has held senior-level and general management roles at Osram Sylvania Inc. More information: origin-www.bloomberg.com/apps/news
Skip Sack joined the Evolucia Inc. Board of Directors in 2012. He currently serves on the Boards of six private companies, one public company and four non-profits, and is the former Chairman of the Board of the National Restaurant Association. He also serves on the Cornell University Council and Dean's Advisory Board of the Hotel School. Skip joins the Board with 50 years of experience in the restaurant and hospitality industry. Up until 2007, he was a member of the Applebee's Board of Directors. More information: http://www.evolucialighting.com/about/leadership
Tom Siegfried has been a member of Evolucia's Board of Directors since 2010. He retired after a 25 year career in commercial and government new construction, renovation and historical restoration in the Washington D.C. area. Before retiring, he was a principal in a national construction company that specializes in governmental and municipal contracts. More information: www.evolucialighting.com/about/leadership
Woody Smith has 35 years of lighting experience in design and implementation of lighting systems. He has held the following positions: Director R&D High End Systems (USA), COO Martin Professional*,(Denmark), International Sales Coemar SpA (Italy), VP Engineering Hubbell Lighting, Founder Affineon Lighting, CTO Evolucia. More information: http://www.evolucialighting.com/about/leadership
__
PARTNERSHIPS
SYLVANIA
Actually, Sylvania hasn't really existed since 1993 when it was sold by its then current owner GTE. Since then, Sylvania was absorbed by three companies, OSRAM, Havells, and spun off as an independent in Australia.
OSRAM
There is no doubt about OSRAM as a "real deal" player, as it is a subsidiary of Siemens itself. You can do your own fundamentals on OSRAM if you wish, but suffice to say, OSRAM is a multi-billion dollar internationally entrenched company. It's been around since 1919.
OSRAM SYLVANIA is the North American business of OSRAM AG of Germany, one of the world's largest manufacturers and part of the Siemens family of companies. The company manufactures and markets a wide range of lighting products for business and industry, consumers, for the automotive industry, and for the computer, aerospace and other major industries worldwide. It employs about 11,200 people in North America and is headquartered in Danvers, MA.
OSRAM SYLVANIA has 22 manufacturing plants, one equipment assembly operation and twelve research and development laboratories, along with a network of sales offices and distribution centers serving all of the United States, Canada, Puerto Rico and Mexico. Most of the company's products are marketed in North and South America under the SYLVANIA or OSRAM brand name. OSRAM, headquartered in Munich, Germany, has over 35,000 employees and 53 production plants in 18 countries around the world. Over the last 10 years, this leading products company has gradually expanded its international presence while tripling sales and doubling its world market share.
The global headquarters for Siemens also is in Munich, Germany, while the company's North American headquarters is in New York City. Siemens does business in the world electrical and electronics market. In addition to , some of the Siemens business groups are: communication and information systems; electric components; automotive and transportation; energy and power generation; medical electronics; and automation. Worldwide, Siemens has 426,000 employees in over 190 countries. (Source: http://www.sylvania.com/en-us/about/Pages/company-profile.aspx )
OSRAM Mexico
This is Evolucia's doorway into Mexico whereby OSRAM Mexico have agreed to further develop the Evolucia Aimed Optics technology, and to market it. (Source; http://www.prnewswire.com/news-releases/osram-mexico-and-evolucia-inc-announce-led-outdoor-luminaire-co-marketing-agreement-190839371.html )
Poland
This is a deal with a Polish entity to create Evolucia Europe. The deal is finalized and for the rights to manufacture and distribute Evolucia products in Europe, the Polish entity will pay Evolucia 11 million by August. (Source: http://www.reuters.com/article/2013/03/20/fl-evolucia-in-europe-idUSnPnCL80404+160+PRN20130320 ) Deals fall through, so watch this for movement.
Here is additional and specific information about the Polish partnership from an email with Evolucia's Craig Hall:
In 2008, SETE [Evolucia's Polish partner] identified LED lighting as an ideal and rapidly growing product offering for government sales. The reason they selected us at that time was because: (1) we had developed a proprietary high quality Aimed Optics prototype that was more efficient than any other product in the market; (2) we were one of the original companies to identify commercial outdoor and street lighting as a target market which is/was a nice fit into both municipal and federal channels; and (3) one of our significant investors is from Poland, and had relationships with this group.
Over the last 4+ years, we licensed our trademarks (Sunovia, Evolucia, Aimed optics, etc.) to this group, and allowed them to operate independently within Poland as Sunovia Energy Technology, Inc. (our former corporate name) to develop distribution channels into the government and military markets for our products. As you can read from their website (sunoviaeurope.com), they piggy-backed our penetration of military bases and national awards with similar achievements in Poland/Europe.
They used their relationships to establish numerous test sites for our street lights, including sites in Radom and Krakow, Poland. The test results have been unanimously positive, and the distribution channels are expected to grow exponentially over the coming months and years.
As a result of the successful tests, this group came back to us requesting the rights to manufacture our products (rather than just purchase) in Poland for distribution into the European markets. We sold them these rights for $11 million, with the caveat that Evolucia, Inc. would have to own a controlling interest in the distribution entity; while the investment group would be allowed to own 100% of the manufacturing company. The agreement requires that they meet quality and favored nations pricing requirements.
Australian Subsidiary
Evolucia LDU Pty Limited, a wholly-owned Australian subsidiary of the Sarasota, Florida-based Evolucia Inc. You can also find this information on the Evolucia website, but I always like to triple check anything found on a company website. Call Evolucia to get more information about how far along this venture is. (Source: http://www.manmonthly.com.au/news/us-lighting-manufacturer-evolucia-sets-up-in-hobar)
Leader Electronics
Leader is a large Asian company and the exclusive partner taking Evolucia to Asia. (Source: http://www.prnewswire.com/news-releases/sunovia-energy-finalizes-partnership-with-leader-electronics-162865966.html). Leader Electronics website: http://leaderen.syis.com.tw/default.aspx
__
AQUISITIONS
Affineon Lighting
This is a product expansion effort for indoor lighting. (http://www.prnewswire.com/news-releases/evolucia-to-acquire-affineon-digital-lighting-204087281.html )
__
AWARDS AND CASE STUDY CONTRACTS
*US Department of Energy
Evolucia's LED Cobra Head SCHX5 was given the award for Best Outdoor Street Light, in its class, by the U.S. Department of Energy (DOE). . . ." (Source: http://seekingalpha.com/instablog/200555-qualitystocks/170330-sunovia-energy-technologies-inc-sunv-evolucia-cobra-head-wins-lighting-industry-s-top-award )
*Military
The U.S. Navy has successfully installed Evolucia Aimed LED cobra head street lights at the Souda Bay base in Crete, Greece.
( Source: http://www.prnewswire.com/news-releases/us-navy-installs-evolucia-aimed-led-lights-on-base-in-greece-104289453.html )
Fort Buckley, CO
(Source; http://www.bizjournals.com/prnewswire/press_releases/2011/05/18/FL03940 )
Camp Lejeune, N.C.
(Source: http://www.prnewswire.com/news-releases/marines-get-better-outdoor-light-and-cut-electricity-by-half-at-camp-lejeune-78222502.html)
*Commercial
Appalachian State and De Paul University
(Source: www.prnewswire.com/news-releases/universities-find-evolucia-led-parking-fixtures-enlightening-176610181.html)
As always, most things in life are based on conditionals, and that is how I will conclude my analysis of the next possible Bubba Gump of the LED market. If Evolucia's technology is as good as it seems (awards and commercial contracts point to that conclusion); and if the new management team, two of which are from OSRAM Sylvania, including the CEO, continue their successes into OSRAM markets as they have done in Mexico, along with their European, Asian, and Australian ventures; and finally, if Evolicia's technology continues to be superior, then Evolucia is set to become The definitive commercial international LED company. Commercial customers will buy technology that realizes the greatest return on their investment. Today, that technology is Evolucia's.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
http://seekingalpha.com/instablog/9577991-dwdallam/1982232-evolucia-is-set-to-become-the-world-s-leading-led-technologyhttp://seekingalpha.com/instablog/9577991-dwdallam/1982232-evolucia-is-set-to-become-the-world-s-leading-led-technology
Evolucia Is Set To Become The World's Leading LED Technology 2 comments
Jun 24, 2013 9:21 PM | about stocks: ILED.OB, RVLT
As traders and investors, one thing we dislike about searching for the next Bubba Gump is reading about it one day before its assumed ignition. That doesn't give us any due diligence margin, and leaves us with two options: Act like herd animals and get slaughtered, or sit on the sidelines and watch Bubba Gump reach high orbit above Wall Street-and cry ourselves to sleep every night. For traders and investors alike, neither option is desirable.
In view of that, I've decided to divulge my research far before that time. In fact, I would suggest not buying Evolucia (ILED.OB) in the short term. Evolucia's float is 1 Billion shares, trading currently at .02 cents. That sounds worse than it actually is, however. I don't know what Evolucia's average float is but let's say it's 25 cents (which is generous, given that since 2009 the price was .10 and has declined to .02 cents since 2011, and they went public in late 2007). At 25 cents a share, that would equal 250M in total float. That's not so bad, really, as a buy back of 125M would reduce float by 50%. Another option is a reverse split, which wouldn't cost the company anything.
In either event, take the time between now and when Evolucia plausibly climbs to the heavens to familiarize yourself with the company: Read a few technical papers on general LED technology, read Evolucia's white paper on their patented LED technology called "Aimed Optics," and become intimate with ILED's stellar management team.
There has been a fair amount of noise about value LED companies lately. Some articles are bullish on these small and micro cap companies and some bearish, all for various reasons. Since I've never been one to follow crowds, deciding which LED value company to follow and perhaps leverage into is based on two key question: (1) Which company has the best technology? and (2) Which company has the greatest chance of marketing that technology to its customer base? The importance of the second question is obvious, but for many, the technology behind a company is of less concern.
In the case of LED markets, weighing technology lighter than marketing is an extremely unfortunate oversight for one key reason: The very existence of LED markets rests on the necessary condition of efficiency. That is, if it weren't for efficiency, there would be no reason to replace, for instance, High Pressure Sodium lamps, those yellow orbs of light familiarly called "street lights" nor the now ubiquitous fluorescent-both of which are a very large targets for LED manufacturers. In fact, LED can eventually replace both technologies indoors and outdoors, but, again, only if LED technology is necessarily more efficient. In other words, ignoring LED energy efficiency is to investors as ignoring wolves is to sheep.
That being the case, efficiency translates backward to technology and forward to the bottom line of commercial customers. Commercial is the operative word here. The consumer market is vastly more unpredictable in that it is highly susceptible to marketing, rather than superior technology (remember the BETAMax by Sony?). That's because consumers are generally ignorant of the technology they buy, buying whatever is cheapest and available when they need it, and in whatever packaging catches their eye. As such, consumer marketing will make or break a company, including a consumer LED lighting company.
Commercial marketing is a different animal. Commercial customers are not ignorant of the technology in which they invest, and, in fact, are going to buy the product with the greatest return on their investment. Therefore, all things being equal, commercially oriented buyers are going to invest in the most efficient-superior-technology. Furthermore, all things being equal, the company with superior technology is more fit to survive as a dominate player in the LED market; and, ipso facto, the entity with superior technology has the best chance of being The dominate player.
So, what company is positioned to dominate in the commercial LED marketplace based on superior technology? My conclusion is Evolucia because has developed and patented the most efficient lighting in the industry.*
The meat of my investigation gravitated around several key questions:
What is Evolucia going to do about its share price?
How is Evolucia's technology compared to its competitors?
Why has Evolucia lagged behind its competition in marketing and sales?
How does Evolucia's new leadership contribute to Evolucia moving forward?
Is Evolucia more industrial oriented or consumer oriented?
I posed those questions to Evolucia's Craig Hall over the phone and in email. I'll number his answers as my questions are numbered above (Note: Unless directly quoted, all information is paraphrased):
On April 30th, 2013, Evolucia's CEO announced that it would be trading on NASDAQ within twelve months. At this time, Evolucia has put stock concerns on the very back burner, but the NASDAQ deadline persists. The reason the NASDAQ listing along with general stock concerns are on the very back burner is that Evolucia is leveraging all of its resources at global marketing, distribution, and manufacturing, with the goal of European, South American, Asian, Australian, and North American manufacturing and distribution locations. This is important because it cuts time to market, international tariffs, customs, and other logistic problems.
Our closest competitor is Revolution (RVLT). "My understanding is that RVLT is commercially focused, but primarily indoor lighting. Evolucia is commercially focused (originally in the outdoor lighting space), but we have transitioned to encompass indoor as well with our acquisition of Affineon Lighting. I can't speak to RVLT's technology, but I can say that in the outdoor lighting space (roadway lighting, parking lots, etc.) that Evolucia's Aimed Optics allows for the highest efficiencies in the industry. . .and our technology outperforms theirs specifically in the outdoor space."* Evolucia's technology rests on the "Aimed Optics" patents. Over $30 million of investment has gone in making Evolucia's technology the most efficient technology in LED lighting.
As stated in #1, that was due to focusing on technology and a low IQ in marketing. Since then, Evolucia has hired two former executives from OSRAM (Sylvania), one in the position of CEO, and an entirely new and extremely experienced management team.
Evolucia's new CEO and one of its Board of Directors are both from OSRAM (Sylvania) and have agreements with OSRAM Mexico to sell ILED technology exclusively in Mexico, as one example. Final agreements to move into Europe with the Polish investment consortium for exclusive manufacturing and distribution rights serving Western and Eastern Europe have been finalized. Also, Evolucia has now formed a subsidiary in Australia to market and manufacture Evolucia products in both Australia and New Zealand. Evolucia has finalized a partnerships with Leader Electronics for all of Asia, and has acquired Affineon Lighting, which will move us to indoor lighting. Last, Evolucia is now a "pure play" commercial LED lighting company.
So, all of that sounds dandy and gets the old stock market blood pumping because it's exactly what Bubbba Gump investors want to hear, right? In order to avoid the slaughter house, however, we need a liberal dose of skepticism and research in order to decide if these partnerships, acquisitions, contracts, and awards can deliver concrete results for Evolucia's future survival and market dominance. (Note that while doing your own due diligence, you may come across older information where Evolucia seems to be connected with Sonovia. Sonovia is Evolucia's old name.)
__
BOARD OF DIRECTORS
Mel Interiano (CEO) is an accomplished lighting industry veteran. He worked for OSRAM SYLVANIA (the lighting division of SIEMENS) for 15 years. Mel was in charge of all international sales for OSRAM SYLVANIA where in just a few months, he broke sales records and created innovative business models for LED sales. More information: http://www.evolucialighting.com/about/leadership
Charles B. Rockwood (EVP) is Evolucia's Executive Vice President and Chief Financial Officer. Charles brings 25 years of financial and operational experience to Evolucia and has held CFO, COO and CEO positions with responsibilities that include financial management, mergers and acquisitions, business development, fulfillment, legal and compliance.
Francis (Frank) J. Santiago is recently retired from OSRAM Sylvania as Executive Vice President & Global Head of Sales and joined the Evolucia Inc. Board of Directors in 2012. He has held senior-level and general management roles at Osram Sylvania Inc. More information: origin-www.bloomberg.com/apps/news
Skip Sack joined the Evolucia Inc. Board of Directors in 2012. He currently serves on the Boards of six private companies, one public company and four non-profits, and is the former Chairman of the Board of the National Restaurant Association. He also serves on the Cornell University Council and Dean's Advisory Board of the Hotel School. Skip joins the Board with 50 years of experience in the restaurant and hospitality industry. Up until 2007, he was a member of the Applebee's Board of Directors. More information: http://www.evolucialighting.com/about/leadership
Tom Siegfried has been a member of Evolucia's Board of Directors since 2010. He retired after a 25 year career in commercial and government new construction, renovation and historical restoration in the Washington D.C. area. Before retiring, he was a principal in a national construction company that specializes in governmental and municipal contracts. More information: www.evolucialighting.com/about/leadership
Woody Smith has 35 years of lighting experience in design and implementation of lighting systems. He has held the following positions: Director R&D High End Systems (USA), COO Martin Professional*,(Denmark), International Sales Coemar SpA (Italy), VP Engineering Hubbell Lighting, Founder Affineon Lighting, CTO Evolucia. More information: http://www.evolucialighting.com/about/leadership
__
PARTNERSHIPS
SYLVANIA
Actually, Sylvania hasn't really existed since 1993 when it was sold by its then current owner GTE. Since then, Sylvania was absorbed by three companies, OSRAM, Havells, and spun off as an independent in Australia.
OSRAM
There is no doubt about OSRAM as a "real deal" player, as it is a subsidiary of Siemens itself. You can do your own fundamentals on OSRAM if you wish, but suffice to say, OSRAM is a multi-billion dollar internationally entrenched company. It's been around since 1919.
OSRAM SYLVANIA is the North American business of OSRAM AG of Germany, one of the world's largest manufacturers and part of the Siemens family of companies. The company manufactures and markets a wide range of lighting products for business and industry, consumers, for the automotive industry, and for the computer, aerospace and other major industries worldwide. It employs about 11,200 people in North America and is headquartered in Danvers, MA.
OSRAM SYLVANIA has 22 manufacturing plants, one equipment assembly operation and twelve research and development laboratories, along with a network of sales offices and distribution centers serving all of the United States, Canada, Puerto Rico and Mexico. Most of the company's products are marketed in North and South America under the SYLVANIA or OSRAM brand name. OSRAM, headquartered in Munich, Germany, has over 35,000 employees and 53 production plants in 18 countries around the world. Over the last 10 years, this leading products company has gradually expanded its international presence while tripling sales and doubling its world market share.
The global headquarters for Siemens also is in Munich, Germany, while the company's North American headquarters is in New York City. Siemens does business in the world electrical and electronics market. In addition to , some of the Siemens business groups are: communication and information systems; electric components; automotive and transportation; energy and power generation; medical electronics; and automation. Worldwide, Siemens has 426,000 employees in over 190 countries. (Source: http://www.sylvania.com/en-us/about/Pages/company-profile.aspx )
OSRAM Mexico
This is Evolucia's doorway into Mexico whereby OSRAM Mexico have agreed to further develop the Evolucia Aimed Optics technology, and to market it. (Source; http://www.prnewswire.com/news-releases/osram-mexico-and-evolucia-inc-announce-led-outdoor-luminaire-co-marketing-agreement-190839371.html )
Poland
This is a deal with a Polish entity to create Evolucia Europe. The deal is finalized and for the rights to manufacture and distribute Evolucia products in Europe, the Polish entity will pay Evolucia 11 million by August. (Source: http://www.reuters.com/article/2013/03/20/fl-evolucia-in-europe-idUSnPnCL80404+160+PRN20130320 ) Deals fall through, so watch this for movement.
Here is additional and specific information about the Polish partnership from an email with Evolucia's Craig Hall:
In 2008, SETE [Evolucia's Polish partner] identified LED lighting as an ideal and rapidly growing product offering for government sales. The reason they selected us at that time was because: (1) we had developed a proprietary high quality Aimed Optics prototype that was more efficient than any other product in the market; (2) we were one of the original companies to identify commercial outdoor and street lighting as a target market which is/was a nice fit into both municipal and federal channels; and (3) one of our significant investors is from Poland, and had relationships with this group.
Over the last 4+ years, we licensed our trademarks (Sunovia, Evolucia, Aimed optics, etc.) to this group, and allowed them to operate independently within Poland as Sunovia Energy Technology, Inc. (our former corporate name) to develop distribution channels into the government and military markets for our products. As you can read from their website (sunoviaeurope.com), they piggy-backed our penetration of military bases and national awards with similar achievements in Poland/Europe.
They used their relationships to establish numerous test sites for our street lights, including sites in Radom and Krakow, Poland. The test results have been unanimously positive, and the distribution channels are expected to grow exponentially over the coming months and years.
As a result of the successful tests, this group came back to us requesting the rights to manufacture our products (rather than just purchase) in Poland for distribution into the European markets. We sold them these rights for $11 million, with the caveat that Evolucia, Inc. would have to own a controlling interest in the distribution entity; while the investment group would be allowed to own 100% of the manufacturing company. The agreement requires that they meet quality and favored nations pricing requirements.
Australian Subsidiary
Evolucia LDU Pty Limited, a wholly-owned Australian subsidiary of the Sarasota, Florida-based Evolucia Inc. You can also find this information on the Evolucia website, but I always like to triple check anything found on a company website. Call Evolucia to get more information about how far along this venture is. (Source: http://www.manmonthly.com.au/news/us-lighting-manufacturer-evolucia-sets-up-in-hobar)
Leader Electronics
Leader is a large Asian company and the exclusive partner taking Evolucia to Asia. (Source: http://www.prnewswire.com/news-releases/sunovia-energy-finalizes-partnership-with-leader-electronics-162865966.html). Leader Electronics website: http://leaderen.syis.com.tw/default.aspx
__
AQUISITIONS
Affineon Lighting
This is a product expansion effort for indoor lighting. (http://www.prnewswire.com/news-releases/evolucia-to-acquire-affineon-digital-lighting-204087281.html )
__
AWARDS AND CASE STUDY CONTRACTS
*US Department of Energy
Evolucia's LED Cobra Head SCHX5 was given the award for Best Outdoor Street Light, in its class, by the U.S. Department of Energy (DOE). . . ." (Source: http://seekingalpha.com/instablog/200555-qualitystocks/170330-sunovia-energy-technologies-inc-sunv-evolucia-cobra-head-wins-lighting-industry-s-top-award )
*Military
The U.S. Navy has successfully installed Evolucia Aimed LED cobra head street lights at the Souda Bay base in Crete, Greece.
( Source: http://www.prnewswire.com/news-releases/us-navy-installs-evolucia-aimed-led-lights-on-base-in-greece-104289453.html )
Fort Buckley, CO
(Source; http://www.bizjournals.com/prnewswire/press_releases/2011/05/18/FL03940 )
Camp Lejeune, N.C.
(Source: http://www.prnewswire.com/news-releases/marines-get-better-outdoor-light-and-cut-electricity-by-half-at-camp-lejeune-78222502.html)
*Commercial
Appalachian State and De Paul University
(Source: www.prnewswire.com/news-releases/universities-find-evolucia-led-parking-fixtures-enlightening-176610181.html)
As always, most things in life are based on conditionals, and that is how I will conclude my analysis of the next possible Bubba Gump of the LED market. If Evolucia's technology is as good as it seems (awards and commercial contracts point to that conclusion); and if the new management team, two of which are from OSRAM Sylvania, including the CEO, continue their successes into OSRAM markets as they have done in Mexico, along with their European, Asian, and Australian ventures; and finally, if Evolicia's technology continues to be superior, then Evolucia is set to become The definitive commercial international LED company. Commercial customers will buy technology that realizes the greatest return on their investment. Today, that technology is Evolucia's.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.Evolucia Is Set To Become The World's Leading LED Technology 2 comments
Jun 24, 2013 9:21 PM | about stocks: ILED.OB, RVLT
As traders and investors, one thing we dislike about searching for the next Bubba Gump is reading about it one day before its assumed ignition. That doesn't give us any due diligence margin, and leaves us with two options: Act like herd animals and get slaughtered, or sit on the sidelines and watch Bubba Gump reach high orbit above Wall Street-and cry ourselves to sleep every night. For traders and investors alike, neither option is desirable.
In view of that, I've decided to divulge my research far before that time. In fact, I would suggest not buying Evolucia (ILED.OB) in the short term. Evolucia's float is 1 Billion shares, trading currently at .02 cents. That sounds worse than it actually is, however. I don't know what Evolucia's average float is but let's say it's 25 cents (which is generous, given that since 2009 the price was .10 and has declined to .02 cents since 2011, and they went public in late 2007). At 25 cents a share, that would equal 250M in total float. That's not so bad, really, as a buy back of 125M would reduce float by 50%. Another option is a reverse split, which wouldn't cost the company anything.
In either event, take the time between now and when Evolucia plausibly climbs to the heavens to familiarize yourself with the company: Read a few technical papers on general LED technology, read Evolucia's white paper on their patented LED technology called "Aimed Optics," and become intimate with ILED's stellar management team.
There has been a fair amount of noise about value LED companies lately. Some articles are bullish on these small and micro cap companies and some bearish, all for various reasons. Since I've never been one to follow crowds, deciding which LED value company to follow and perhaps leverage into is based on two key question: (1) Which company has the best technology? and (2) Which company has the greatest chance of marketing that technology to its customer base? The importance of the second question is obvious, but for many, the technology behind a company is of less concern.
In the case of LED markets, weighing technology lighter than marketing is an extremely unfortunate oversight for one key reason: The very existence of LED markets rests on the necessary condition of efficiency. That is, if it weren't for efficiency, there would be no reason to replace, for instance, High Pressure Sodium lamps, those yellow orbs of light familiarly called "street lights" nor the now ubiquitous fluorescent-both of which are a very large targets for LED manufacturers. In fact, LED can eventually replace both technologies indoors and outdoors, but, again, only if LED technology is necessarily more efficient. In other words, ignoring LED energy efficiency is to investors as ignoring wolves is to sheep.
That being the case, efficiency translates backward to technology and forward to the bottom line of commercial customers. Commercial is the operative word here. The consumer market is vastly more unpredictable in that it is highly susceptible to marketing, rather than superior technology (remember the BETAMax by Sony?). That's because consumers are generally ignorant of the technology they buy, buying whatever is cheapest and available when they need it, and in whatever packaging catches their eye. As such, consumer marketing will make or break a company, including a consumer LED lighting company.
Commercial marketing is a different animal. Commercial customers are not ignorant of the technology in which they invest, and, in fact, are going to buy the product with the greatest return on their investment. Therefore, all things being equal, commercially oriented buyers are going to invest in the most efficient-superior-technology. Furthermore, all things being equal, the company with superior technology is more fit to survive as a dominate player in the LED market; and, ipso facto, the entity with superior technology has the best chance of being The dominate player.
So, what company is positioned to dominate in the commercial LED marketplace based on superior technology? My conclusion is Evolucia because has developed and patented the most efficient lighting in the industry.*
The meat of my investigation gravitated around several key questions:
What is Evolucia going to do about its share price?
How is Evolucia's technology compared to its competitors?
Why has Evolucia lagged behind its competition in marketing and sales?
How does Evolucia's new leadership contribute to Evolucia moving forward?
Is Evolucia more industrial oriented or consumer oriented?
I posed those questions to Evolucia's Craig Hall over the phone and in email. I'll number his answers as my questions are numbered above (Note: Unless directly quoted, all information is paraphrased):
On April 30th, 2013, Evolucia's CEO announced that it would be trading on NASDAQ within twelve months. At this time, Evolucia has put stock concerns on the very back burner, but the NASDAQ deadline persists. The reason the NASDAQ listing along with general stock concerns are on the very back burner is that Evolucia is leveraging all of its resources at global marketing, distribution, and manufacturing, with the goal of European, South American, Asian, Australian, and North American manufacturing and distribution locations. This is important because it cuts time to market, international tariffs, customs, and other logistic problems.
Our closest competitor is Revolution (RVLT). "My understanding is that RVLT is commercially focused, but primarily indoor lighting. Evolucia is commercially focused (originally in the outdoor lighting space), but we have transitioned to encompass indoor as well with our acquisition of Affineon Lighting. I can't speak to RVLT's technology, but I can say that in the outdoor lighting space (roadway lighting, parking lots, etc.) that Evolucia's Aimed Optics allows for the highest efficiencies in the industry. . .and our technology outperforms theirs specifically in the outdoor space."* Evolucia's technology rests on the "Aimed Optics" patents. Over $30 million of investment has gone in making Evolucia's technology the most efficient technology in LED lighting.
As stated in #1, that was due to focusing on technology and a low IQ in marketing. Since then, Evolucia has hired two former executives from OSRAM (Sylvania), one in the position of CEO, and an entirely new and extremely experienced management team.
Evolucia's new CEO and one of its Board of Directors are both from OSRAM (Sylvania) and have agreements with OSRAM Mexico to sell ILED technology exclusively in Mexico, as one example. Final agreements to move into Europe with the Polish investment consortium for exclusive manufacturing and distribution rights serving Western and Eastern Europe have been finalized. Also, Evolucia has now formed a subsidiary in Australia to market and manufacture Evolucia products in both Australia and New Zealand. Evolucia has finalized a partnerships with Leader Electronics for all of Asia, and has acquired Affineon Lighting, which will move us to indoor lighting. Last, Evolucia is now a "pure play" commercial LED lighting company.
So, all of that sounds dandy and gets the old stock market blood pumping because it's exactly what Bubbba Gump investors want to hear, right? In order to avoid the slaughter house, however, we need a liberal dose of skepticism and research in order to decide if these partnerships, acquisitions, contracts, and awards can deliver concrete results for Evolucia's future survival and market dominance. (Note that while doing your own due diligence, you may come across older information where Evolucia seems to be connected with Sonovia. Sonovia is Evolucia's old name.)
__
BOARD OF DIRECTORS
Mel Interiano (CEO) is an accomplished lighting industry veteran. He worked for OSRAM SYLVANIA (the lighting division of SIEMENS) for 15 years. Mel was in charge of all international sales for OSRAM SYLVANIA where in just a few months, he broke sales records and created innovative business models for LED sales. More information: http://www.evolucialighting.com/about/leadership
Charles B. Rockwood (EVP) is Evolucia's Executive Vice President and Chief Financial Officer. Charles brings 25 years of financial and operational experience to Evolucia and has held CFO, COO and CEO positions with responsibilities that include financial management, mergers and acquisitions, business development, fulfillment, legal and compliance.
Francis (Frank) J. Santiago is recently retired from OSRAM Sylvania as Executive Vice President & Global Head of Sales and joined the Evolucia Inc. Board of Directors in 2012. He has held senior-level and general management roles at Osram Sylvania Inc. More information: origin-www.bloomberg.com/apps/news
Skip Sack joined the Evolucia Inc. Board of Directors in 2012. He currently serves on the Boards of six private companies, one public company and four non-profits, and is the former Chairman of the Board of the National Restaurant Association. He also serves on the Cornell University Council and Dean's Advisory Board of the Hotel School. Skip joins the Board with 50 years of experience in the restaurant and hospitality industry. Up until 2007, he was a member of the Applebee's Board of Directors. More information: http://www.evolucialighting.com/about/leadership
Tom Siegfried has been a member of Evolucia's Board of Directors since 2010. He retired after a 25 year career in commercial and government new construction, renovation and historical restoration in the Washington D.C. area. Before retiring, he was a principal in a national construction company that specializes in governmental and municipal contracts. More information: www.evolucialighting.com/about/leadership
Woody Smith has 35 years of lighting experience in design and implementation of lighting systems. He has held the following positions: Director R&D High End Systems (USA), COO Martin Professional*,(Denmark), International Sales Coemar SpA (Italy), VP Engineering Hubbell Lighting, Founder Affineon Lighting, CTO Evolucia. More information: http://www.evolucialighting.com/about/leadership
__
PARTNERSHIPS
SYLVANIA
Actually, Sylvania hasn't really existed since 1993 when it was sold by its then current owner GTE. Since then, Sylvania was absorbed by three companies, OSRAM, Havells, and spun off as an independent in Australia.
OSRAM
There is no doubt about OSRAM as a "real deal" player, as it is a subsidiary of Siemens itself. You can do your own fundamentals on OSRAM if you wish, but suffice to say, OSRAM is a multi-billion dollar internationally entrenched company. It's been around since 1919.
OSRAM SYLVANIA is the North American business of OSRAM AG of Germany, one of the world's largest manufacturers and part of the Siemens family of companies. The company manufactures and markets a wide range of lighting products for business and industry, consumers, for the automotive industry, and for the computer, aerospace and other major industries worldwide. It employs about 11,200 people in North America and is headquartered in Danvers, MA.
OSRAM SYLVANIA has 22 manufacturing plants, one equipment assembly operation and twelve research and development laboratories, along with a network of sales offices and distribution centers serving all of the United States, Canada, Puerto Rico and Mexico. Most of the company's products are marketed in North and South America under the SYLVANIA or OSRAM brand name. OSRAM, headquartered in Munich, Germany, has over 35,000 employees and 53 production plants in 18 countries around the world. Over the last 10 years, this leading products company has gradually expanded its international presence while tripling sales and doubling its world market share.
The global headquarters for Siemens also is in Munich, Germany, while the company's North American headquarters is in New York City. Siemens does business in the world electrical and electronics market. In addition to , some of the Siemens business groups are: communication and information systems; electric components; automotive and transportation; energy and power generation; medical electronics; and automation. Worldwide, Siemens has 426,000 employees in over 190 countries. (Source: http://www.sylvania.com/en-us/about/Pages/company-profile.aspx )
OSRAM Mexico
This is Evolucia's doorway into Mexico whereby OSRAM Mexico have agreed to further develop the Evolucia Aimed Optics technology, and to market it. (Source; http://www.prnewswire.com/news-releases/osram-mexico-and-evolucia-inc-announce-led-outdoor-luminaire-co-marketing-agreement-190839371.html )
Poland
This is a deal with a Polish entity to create Evolucia Europe. The deal is finalized and for the rights to manufacture and distribute Evolucia products in Europe, the Polish entity will pay Evolucia 11 million by August. (Source: http://www.reuters.com/article/2013/03/20/fl-evolucia-in-europe-idUSnPnCL80404+160+PRN20130320 ) Deals fall through, so watch this for movement.
Here is additional and specific information about the Polish partnership from an email with Evolucia's Craig Hall:
In 2008, SETE [Evolucia's Polish partner] identified LED lighting as an ideal and rapidly growing product offering for government sales. The reason they selected us at that time was because: (1) we had developed a proprietary high quality Aimed Optics prototype that was more efficient than any other product in the market; (2) we were one of the original companies to identify commercial outdoor and street lighting as a target market which is/was a nice fit into both municipal and federal channels; and (3) one of our significant investors is from Poland, and had relationships with this group.
Over the last 4+ years, we licensed our trademarks (Sunovia, Evolucia, Aimed optics, etc.) to this group, and allowed them to operate independently within Poland as Sunovia Energy Technology, Inc. (our former corporate name) to develop distribution channels into the government and military markets for our products. As you can read from their website (sunoviaeurope.com), they piggy-backed our penetration of military bases and national awards with similar achievements in Poland/Europe.
They used their relationships to establish numerous test sites for our street lights, including sites in Radom and Krakow, Poland. The test results have been unanimously positive, and the distribution channels are expected to grow exponentially over the coming months and years.
As a result of the successful tests, this group came back to us requesting the rights to manufacture our products (rather than just purchase) in Poland for distribution into the European markets. We sold them these rights for $11 million, with the caveat that Evolucia, Inc. would have to own a controlling interest in the distribution entity; while the investment group would be allowed to own 100% of the manufacturing company. The agreement requires that they meet quality and favored nations pricing requirements.
Australian Subsidiary
Evolucia LDU Pty Limited, a wholly-owned Australian subsidiary of the Sarasota, Florida-based Evolucia Inc. You can also find this information on the Evolucia website, but I always like to triple check anything found on a company website. Call Evolucia to get more information about how far along this venture is. (Source: http://www.manmonthly.com.au/news/us-lighting-manufacturer-evolucia-sets-up-in-hobar)
Leader Electronics
Leader is a large Asian company and the exclusive partner taking Evolucia to Asia. (Source: http://www.prnewswire.com/news-releases/sunovia-energy-finalizes-partnership-with-leader-electronics-162865966.html). Leader Electronics website: http://leaderen.syis.com.tw/default.aspx
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AQUISITIONS
Affineon Lighting
This is a product expansion effort for indoor lighting. (http://www.prnewswire.com/news-releases/evolucia-to-acquire-affineon-digital-lighting-204087281.html )
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AWARDS AND CASE STUDY CONTRACTS
*US Department of Energy
Evolucia's LED Cobra Head SCHX5 was given the award for Best Outdoor Street Light, in its class, by the U.S. Department of Energy (DOE). . . ." (Source: http://seekingalpha.com/instablog/200555-qualitystocks/170330-sunovia-energy-technologies-inc-sunv-evolucia-cobra-head-wins-lighting-industry-s-top-award )
*Military
The U.S. Navy has successfully installed Evolucia Aimed LED cobra head street lights at the Souda Bay base in Crete, Greece.
( Source: http://www.prnewswire.com/news-releases/us-navy-installs-evolucia-aimed-led-lights-on-base-in-greece-104289453.html )
Fort Buckley, CO
(Source; http://www.bizjournals.com/prnewswire/press_releases/2011/05/18/FL03940 )
Camp Lejeune, N.C.
(Source: http://www.prnewswire.com/news-releases/marines-get-better-outdoor-light-and-cut-electricity-by-half-at-camp-lejeune-78222502.html)
*Commercial
Appalachian State and De Paul University
(Source: www.prnewswire.com/news-releases/universities-find-evolucia-led-parking-fixtures-enlightening-176610181.html)
As always, most things in life are based on conditionals, and that is how I will conclude my analysis of the next possible Bubba Gump of the LED market. If Evolucia's technology is as good as it seems (awards and commercial contracts point to that conclusion); and if the new management team, two of which are from OSRAM Sylvania, including the CEO, continue their successes into OSRAM markets as they have done in Mexico, along with their European, Asian, and Australian ventures; and finally, if Evolicia's technology continues to be superior, then Evolucia is set to become The definitive commercial international LED company. Commercial customers will buy technology that realizes the greatest return on their investment. Today, that technology is Evolucia's.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
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