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Medical Services Increases Contracts and Orders in China~
EDMONTON, Alberta, March 4, 2005 /PRNewswire-FirstCall via COMTEX/ -- Medical Services International Inc. (Pinksheets: MSITF) is pleased to announce that it has received additional contracts and orders in China. The Company now has confirmed orders and contracts to supply 4.8 million VScan HIV test kits in the next year. This represents approximately 5% of the current market in China. These test kits will generate revenues of $10,896,000 US in the fiscal period from July 1, 2005 to June 30, 2006. The Company expects this amount to increase as the accuracy and ease of use of our test kits becomes common knowledge.
Further revenue will be generated from the China operation as the Tuberculosis (TB), Dengue Fever and Hepatitis B&C get approved. The VScan TB test kit has already been submitted for approval. The remainder of the kits will be submitted for approval by the end of May, 2005.
The Company also expects to generate significant revenue in the other areas where the VScan HIV test kit has been approved.
IMO, the company is starting to deliver on the promises it made last year to get its HIV test approved in China and other countries and to get a strong revenue stream in place. With additional test kits in the approval process, and with only a small share of the potential HIV test kit market in China, I see the company's long term prospects as extraordinarily bright - and that it is not a question of "if" but "when" the market price will start to reflect the company's growing value. GLTA longs.
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* If the company can generate a total of $25 million in revenues next year; * and if the company can bring 15% of that to the bottom line; * and if the company is assumed to have as many as 3 billion shares outstanding (I acknowledge this is a high number not supported by current stale data, but I am guessing "too high" for conservative estimation purposes); * and if a 50 times earnings is a reasonable multiple for a high growth company (I deem MSITF to be such a company at this point in time);
Then: The PPS should be about .06 per share.
Based on the above, it sure seems to me that this is one highly undervalued stock. What is the market waiting for - cash dividends?
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