DataLogic Releases CEO Letter to Shareholders Outlining Company's Performance and Forward Guidance
February 19 2004 - 8:00AM
PR Newswire (US)
DataLogic Releases CEO Letter to Shareholders Outlining Company's
Performance and Forward Guidance IRVINE, Calif., Feb. 19
/PRNewswire-FirstCall/ -- DataLogic International, Inc. (OTC
Bulletin Board: DLGI; Berlin Stock Exchange: 779612), today
releases a letter to shareholders outlining its performance and
forward guidance. To Our Valued Shareholders, As we enter into
another exciting year, I'd like to express my deepest gratitude to
all our shareholders for your continuing vote of confidence,
patience, and support throughout the last two and a half years of
DataLogic as a publicly-traded company. Although the roads to
growth and profits were often paved with obstacles, temporary
defeats and false promises, DataLogic has weathered and survived
one of toughest economic downturns that the Company has encountered
since its inception. Today, DataLogic is a completely different
company with improved operations, sales and growth opportunities.
As part of our on-going open communications and commitments to our
shareholders, I'd like to share some of our recent accomplishments
along with future plans that will set the stage for the most
exciting events in the history of DataLogic: IT Services Since
inception, DataLogic Consulting Inc. (DCI) has been the provider of
Information Technology (IT) Consulting Services. Although this
company had performed well as an independent privately-held company
from its inception to the late nineties, it became a victim of the
technology and economic meltdown in the early 2000's. In response,
DataLogic's management diligently searched for new market segments
in which to target. At that point, we decided to pursue
governmental service contracts. This had proved to be a positive
move since the Company was later awarded several major multi-year
service contracts with governmental entities in the state of New
York and Rhode Island for an approximate combine value of $40
million. As a result of this phenomenal turn around, we were
pleased to booked record sales in excess of $10 million at the end
of fiscal 2003 as compared to $2 million from the prior year.
Although Consulting Services is still our core business and a major
source of our revenues, we are not overly satisfied with its rate
of return due to the continued weakness in the economy in general
and IT in particular. As a counter measure, we again seek for other
market segments for growth. As a result, we expanded our business
model to include being a provider of VoIP and Machine-to-Machine
(M2M) products and services. Each of these segments has huge growth
potential. We also believe our entrance timing to these markets is
great due to the technology maturation, proliferation of broadband
and wireless standards. VoIP Last June, DataLogic acquired a
majority stake in I-Phonehome, which we later renamed to IPN
Communications, to enter into the VoIP space. IPN is a provider of
VoIP products and services for the consumer and business markets.
Our unique suite of services provides free to low-cost, high
quality phone calls using our innovative Voice over IP calling
devices. Our system allows subscribers to receive and place calls
to any telephone, mobile phone or other IP-Phones in the world.
Since the acquisition, IPN had received several purchase orders
ranging from domestic resellers to international telecommunication
carriers. Some of IPN's notable achievements include the agreements
to evaluate VoIP phones and servers by Teracom Technology in China
and Vietnam Post and Telecom (VNPT) for deployment in their
respective regions with a combined population of almost 2 billion.
Our equipment are also being evaluated by several other large firms
who have asked to remain anonymous due to competitive reasons. We
expect these efforts to result in sizable purchase orders in Q1 and
Q2 of this year. According to a recent research study from Insight
Research, VoIP based services is expected to grow from $13 billion
in 2002 to nearly $197 billion by 2007, making it the
fastest-growing segments in the telecommunications industry. Our
plans to capture some of this market include both domestic and
international marketing but with a heavier emphasis on the latter.
In addition to North America, we will continue to place heavy
marketing emphasis to Asia, South America and Europe where we see
significant value for VoIP products and services. Also, as part of
our near-term strategic plan, we intend to spin-off IPN into a
public entity to create a VoIP pure play. We believe this
willenhance the equity and market capitalization for DataLogic as
well as our shareholders. Machine-to-Machine (M2M) Earlier this
quarter, DataLogic launched Panther, a GPS based vehicle tracking
device as its first M2M application. Our devices, available in both
GSM and CDMA, have attracted a high level of interest from both
domestic and international distributors and resellers. Currently,
we have agreements in place with distributors in the US, UK, and
Brazil. By the second quarter, we expect to sign with additional
distributors in Germany, Holland, France, Colombia, Chile,
Paraguay, Bolivia, Australia, New Zealand, and Southeast Asia. We
are also actively working with domestic and international back end
application developers to interface with and market our products to
their respective clients. The existing market for wireless
telemetry is estimated to be $1.15 billion and by the year 2006, it
is estimated that the combine revenue within the M2M market (US,
Japan, and Western Europe) will be$3.6 billion as researched by the
Yankee Group and growing to $100 Billion by the end of year 2010
according to McKinsey and Company. These are very promising
products that we think will contribute to DataLogic's bottom line
in terms of high sales and profit margins. As part of our near term
marketing initiatives, we plan to exhibit the devices with our
partners at the expos in Brazil, Atlanta and Las Vegas next month.
Sales Projections Our company now consists of three core businesses
- ConsultingServices, VoIP and M2M. For fiscal 2004, we expect our
Consulting Services to remain a dominant source of revenues with
projected sales that comprise of approximately 60% of total
revenues. We expect each of our VoIP and M2M segment to
conservativelymake up 20% of total revenues. Our conservative
organic growth projection for fiscal 2004 is $20 million. We expect
to exceed this amount via our external growth through merger and
acquisitions. External Growth We are actively seeking funding and
expect to undergo a major capital restructuring this quarter. We
also expect to complete several merger and acquisitions of other
technology, VoIP and/or M2M companies in efforts to increase our
market shares and company valuation. Although we will continue to
grow our current businesses, we will not be limited to our current
technologies. Our focus going forward is in the global economy. We
will continue to seek out emerging markets and growth trends in
which to enter. Our new business model includes roll-up initiatives
in which we identify, acquire and consolidate profitable
businesses. These businesses can be located anywhere in the world.
Once sufficient funding has been secured and our business has
reached the projected benchmarks, the next logical step would be to
apply for a listing on the NASDAQ Smallcap Exchange. To do so,
we'll need to have the right substance and meet certain share
price/assets criteria along with the right investor groups and
market makers that could tell our story to the investment
communities. We think the timeframe to meet those criteria is
between six to twelve months. However, we will achieve this goal
quicker if the right events and resources are in place before that.
In conclusion, we're quite pleased with the progress we have made
in all facets of our business as evidenced by our current stock
price. Our stock has been trading near its 52-week high compared to
3 cents less than a year ago. Now that the company is on a steady
growth track, we willupdate you frequently with our progresses.
Again, we thank you for your support. Without your heartfelt
support and encouragement, DataLogic wouldn't be where we are
today. Sincerely, Derek Nguyen Chief Executive Officer About
DataLogic International Inc. DataLogic International, Inc. is a
technology and professional service company dedicated to providing
a wide range of Information Technology and Communications related
products and services. For more information about DataLogic, goto
http://www.dlgi.com/ or contact Investor Relations at or (888)
530-8228. This release contains forward-looking statements within
the meaning of Section 27a of the Securities Act of 1933, as
amended and section 21e of the Securities and Exchange Act of 1934,
as amended. Those statements include the intent, belief or current
expectations of the company and its management team. Prospective
investors are cautioned that any such forward-looking statements
are not guarantees of future performance and involve risks and
uncertainties, and that actual results may differ materially from
those projected in the forward-looking statements as a result of
various factors. Accomplishing the strategy described herein is
significantly dependent upon numerous factors, many are not in
management's control. Some of these factors include the ability of
the company to raise sufficient capital, attract qualified
management, attract new customers and effectively compete against
similar companies. DATASOURCE: DataLogic International, Inc.
CONTACT: Investor Relations of DataLogic, +1-888-530-8228, Web
site: http://www.dlgi.com/
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