HINGHAM, Mass., June 20, 2008 (PRIME NEWSWIRE) -- On June 18, Evercel, Inc. (Pink Sheets:EVRC) released a report to shareholders from CEO Garry Prime and Chairman James Gerson on the company's progress during 2007:
Fellow investors:
It has been about seven months since our last update to shareholders. While, as explained below, we cannot yet provide financial statements, we will try to keep you apprised of major events at Evercel. Generally, both our operations and investments are doing well. The lack of recent certified financial statements, on the other hand, is a significant disappointment which we are addressing.
Operations:
1-New England Crab Co. had a record year in 2007 in terms of revenues and profits. 2008 began a very promising year as well until May. At that point our supplier of contract labor was required to change the employment status of his workers from independent contractors to employees. The result was a large increase in his charges to us. While the final impact is unknown, it is highly unlikely that we can achieve last year's level of profitability. As a result of this forecasted decline we are researching ways to increase our margins. Over the next few months we plan to initiate sales of processed crab products such as crab cakes and bisques primarily through web based direct marketing.
2-Sontek Medical, which sells a disposable medical device for use with intubated critical care patients, has sales and profits similar to last year. There has been very little variation in financial performance for several years.
Investments:
1-Our largest investment, Zipcar Inc., continues to perform well. The company has continued its very rapid growth both organically and through the acquisition of a competitor, Flexcar Inc. The current economic climate and high fuel prices should further increase the use of car-sharing. Zipcar is by far the largest car sharing company in the U.S.
2-Our investment in Oxygen (Italian electric scooter manufacturer) is not performing well. Sales in 2007 were low and losses were large. Recently there were major management changes and a new investor is in control. The investor appears willing and able to provide both the capital and guidance that the company needs. The opportunity is very large and there is increasing momentum for the use of electric vehicles.
3-Julia Therapeutics is a development-stage venture attempting to use ultrasound-like waves for reduction of skin wrinkles. The company recently received the approval necessary to begin clinical testing in Europe. We expect to have preliminary results late this fall.
Corporate:
Our inability to receive audited financial statements for the periods ended December 31, 2006 and 2007 is disappointing. We believe that all necessary fieldwork and valuation reports have been completed. We have no explanation for the delay on the part of our auditors, only embarrassment. We are doing our best and will certainly notify our shareholders when we receive the audit report.
About Evercel
Hingham, Mass.-based Evercel is a multi-industry company whose operations include crab processing for both fresh and frozen markets, and sale of a disposable valve used in the treatment of critically ill patients on respirators. Evercel's investments include Zipcar Inc. (car sharing), Oxygen SpA (light electric vehicles), and Julia LLC (skin wrinkle reduction technology).