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Albany Molecular Research Inc. Message Board

  • andre10053 andre10053 Jun 28, 2005 10:59 AM Flag

    Nanotechnology compnay

    As some of you may know, there is a nanotechnology company in Newton, Mass. named MFIC Corporation (symbol MFIC) that is by far the tiniest company in the Punk-Ziegel Nanotechnology Index. Its market cap, as of today, is in the 27 million dollar range. Its primary market is biotech/pharma. Pfizer owns 600,000 shares according to its February 2, 2005 filing with the SEC of a Form 13D.

    Despite its tiny market cap, it was significantly profitable during 2004, particularly the last nine months of 2004, and is developing a revolutionary new nanotechnology that has been publicly described as a technology �poised to make a significant impact upon the world� by a group of MIT faculty members.

    On Monday, June 13, the company released news that its recent R&D activity had paid off handsomely in that it had received its first three orders for its "constant operating pressure" M-700 production systems. It is my understanding that each of these systems weigh in the thousands of pounds and cost in the hundreds of thousands of dollars.

    If you may be interested in reading more, a comprehensive analysis can be found at the following Raging Bull site:

    wwwDOTragingbullDOTlycosDOTcom/mboard/boards.cgi?board=NANOTECH&read=3303

    "DOT" = "."

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    • MFIC, a company first brought to the attention of this board in message 4110, recently released its Q2 10-Q. To refresh everyone�s memory, the company�s market cap at 17.58 million is by far the tiniest of all the companies listed in the Punk-Ziegel Nanotechnology Index. It sells precisely engineered nanoparticle and microparticle fluid processing equipment primarily to the biotech industry (for the formulation of products like injectable drugs and drug candidates), but also to the cosmetics, chemical, neutraceutical, and ink jet ink industries. Pfizer owns 600,00 shares.

      The Q2 10-Q reported a 3% or so revenue improvement over the year ago�s quarter and a $627,176 revenue increase over Q1 of this year. Somewhat disappointing to some of the company�s investors, the company was unable to report positive net income during Q2 despite those revenue increases.

      Apparently, the $36,193 Q2 net loss (on $3,163,645 in revenues) was incurred due to two primary reasons: (1) the company has continued its significantly stepped-up level of R&D which it commenced during the latter part of 2004 and (2) the company�s Q2 gross margin, at 49.19%, was significantly below its usual 55% or so primarily due to pricing concessions given on its two beta prototype models of its newly introduced M-700 constant pressure (�CP�) systems and some �one time� increases to cost of goods sold. According to the company�s conference call (which can be accessed at www.mficcorp.com/nimages/sound/6349433-081505.mp3 ), only those first two sales involved such a beta model discount. The other three orders that it subsequently received, as well as a new order whose receipt is imminent, will not involve such a discount. As an aside, M-700 constant pressure machines, according to my understanding, cost in the hundreds of thousands of dollars and weigh in the thousands of pounds.


      10-Q Highlights

      ************Q2, 2004****Q1, 2005****Q2, 2005

      Revenues****3,081,977****2,536,469***3,163,645
      Cost of GS***1,406,003****1,148,929***1,607,279
      ************-----------****------------***-----------
      GrossProfit***1,675,974****1,387,540***1,556,366

      Gross margin**54.38%********54.70%*****49.19%
      GrProf/Revs
      (aka profit margin)

      Operating Expenses:

      Selling******588,417*******614,095*****658,221
      R&D*******207,183*******421,075*****384,528
      G&A*******615,453*******538,018*****536,228
      ************_________**_________****_______
      Total Op Ex*1,411,053******1,573,188***1,578,977

      Income Tax Benefit***********77,000

      NETINC(LOSS)*256,495****(116,066)*****(36,193)

      Obviously, if the company had achieved its usual 55% or so gross margins on higher (i.e., non-discounted) revenues during Q2, it would have earned hundreds of thousands in net income. Moreover, had it not spent significantly more on R&D than last year (apparently to (1) further develop its revolutionary new MMR technology, (2) to position itself to compete for business involving million dollar systems, and (3) to develop more new products and improve existing products), it would have earned hundreds of thousands more.

      Despite the rather upbeat conference call which notified investors about a particularly robust business environment currently enjoyed by the company, the stock price has continued its plummet from significantly higher levels. Apparently, this has been due to the relentless selling of what appears to be hundreds of thousands of shares by a single large seller who has frequently appeared as �GNET� on Level 2 screens. In light of MFIC�s current $17.58 million market cap, its apparently "hot" current business environment, and its overall business profile, such relentless �at any price� selling is inexplicable to many.

      In the meantime, MFIC is on sale!!!

    • In my message on this board on June 28 (to which I'm replying), I mentioned a company called MFIC.

      I just wanted to let those who may be interested know that the company released news today that they had received two new orders for their newly introduced M-700 constant operating pressure systems (thereby totaling five in a matter of weeks). It is my understanding that these systems weigh thousands of pounds and cost in the hundreds of thousands of dollars.

      Not too shabby for a micro microcap company.

 
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