NewMarket Technology, Inc. Releases First Letter in Series of Updates on Acquisitions, Subsidiary Listings, Dividends and Move to a National Exchange
DALLAS, TX--(Marketwire - February 22, 2008) - NewMarket Technology, Inc. (OTCBB: NMKT) today
released a letter from CEO Philip M. Verges. The letter is the first in a
series of letters to be released over the next few weeks to provide
detailed updates on the Company's plans for acquisitions after a two year
hiatus, to continue with the independent listing of subsidiaries, to issue
dividends and to move to a national exchange. Highlights of NewMarket
related transactions have recently been released involving the company's
two subsidiaries, NewMarket China, Inc. and NewMarket Latin America, Inc. ,
and digiMedical Solutions, Inc., Alternet Systems, Inc. (OTCBB: ALYI),
Worldwide Strategies, Inc. (OTCBB: WWSG), Pegasus Wireless Corporation
(OTCBB: PGSW), and Enable IPC Corporation. The upcoming series of letters
will elaborate on more details related to these transactions.
The letter is included in its entirety below:
Dear Stakeholders and All Whom Have Interest in the Small Business Market:
We launched a crusade here at NewMarket over five years ago and many of you
reading this letter have played an essential role in the NewMarket crusade.
After creating a technology start-up ten years ago, the NewMarket founders
suffered the fate of most early stage technology companies -- a severe lack
of available investment capital. By 2002, after the "dotcom bubble" burst,
most early stage technology companies launched within the preceding five
years closed their doors. That same year, NewMarket otherwise decided to
launch our crusade to change the market's perception of investments in
early stage technologies by building an entirely new business model
designed to build investor confidence by improving the predictability of
investment performance. NewMarket's vision is to establish a recognized,
respectable and repeatable early stage technology investment scenario.
NewMarket is in the business of continuously introducing new technologies
to new markets.
13,000 Stakeholders Contribute to NewMarket Early Stage Technology Vision
Over 13,000 retail investors have become stakeholders in the NewMarket
crusade. Over 13,000 individuals have purchased and are holding stock in
NewMarket. I use the word stakeholder because purchasing stock in NewMarket
makes a retail investor much more than just a shareholder in another public
company. We meet with hundreds of investors and shareholders every year in
public forums NewMarket conducts or participates in to share what we have
learned along the crusade trail and to present the map of where we plan to
go next. We publish volumes of letters, emails and press releases to reach
thousands more with our message. The participation of those 13,000
stakeholders has been the heart and soul of the NewMarket crusade over the
past five years.
Stakeholder Frustration; Stakeholder Passion
I have the privilege of speaking with many stakeholders every year.
Sometimes the conversation is initiated around a stakeholder's frustration.
NewMarket has fought numerous battles along the way. Some of which we have
won and some of which we have lost. While we are winning the early stage
technology investment war, we are not without our causalities and injuries
from lost battles. The stakeholder frustrations I encounter almost always
stem from the passion that stakeholder has for the NewMarket vision and
their sense that the Company could be doing more or doing something better
to realize that vision. The frustrations I encounter are more than the
usual shareholder frustration resulting from less than desirable stock
price performance.
NewMarket stakeholder frustrations are perhaps the best measure of
NewMarket's success. Stakeholders have made the Company's vision their
own. They are expressing to management what management can do to be a
better custodian of the vision. I too have my own frustrations and when I
hear the frustrations of another stakeholder I am delighted by the passion
I know we share for the NewMarket vision.
Fundamental Financial Performance Measures of Success
In addition to the stakeholders' passion for the NewMarket vision, the
Company has many additional measures of success. The Company has enjoyed
tremendous growth from $1 million in reported revenue in 2002 to
approximately $100 million in annualized revenue today. Unlike many early
stage, fast growth technology companies, NewMarket has even managed to
maintain profitability throughout its rapid growth. NewMarket's growth has
been recognized by being named near the top of the Deloitte Technology Fast
500 for three years running.
Globally Positioned to Flourish Through Down Economy in North America
Futhermore, notably, NewMarket has established operations in two of the
world's high growth areas, namely Latin America and Asia. NewMarket began
operations overseas several years ago and has core, regional systems
integration businesses well established in each of those markets.
NewMarket China reported $29.5 million in revenue in 2006 and has already
reported $27.9 million through the first three quarters of 2007. Latin
American operations had approximately $16.5 million in revenue through the
first three quarters as well. Now that China's annual GDP growth of over
10% annually and Brazil's position in the world as a prime investment area
are now being recognized, NewMarket is well positioned to take advantage of
the regional growth with established, core systems integration businesses
in each country.
Higher Purpose; Higher Profit
Additional measures of success include NewMarket's "higher purpose"
contributions to the world's developing economic regions laboring against
basic resource constraints to simply establish a universal standard of
living. In the course of NewMarket's crusade to build a recognized,
respectable and repeatable early stage technology investment scenario, the
Company has discovered the opportunity to expand this crusade into the
world's developing economic regions. The world's developing economic
regions regularly provide retail investors better return on investment
prospects, while at the same time supporting job creation where it has
otherwise been difficult. The majority of NewMarket's revenue growth has
come from developing economic regions in Asia and South America where the
Company has likewise created hundreds of jobs.
The OTCBB as a Pioneer in the Global Small Business Market
NewMarket has great confidence in the future of the micro-cap public
markets. The Over-the-Counter Bulletin Board (OTCBB) market is a pioneer
in the micro-cap public world. The OTCBB is only ten years old. While
other "penny" markets may have existed before to trade the stocks of small
businesses, start-ups or distressed companies, the OTCBB set out to
legitimize the "penny" market through standardization, regulation, and
oversight. The financial market is experiencing a global proliferation of
"penny" exchanges today with initiatives underway in England, France,
Germany, Singapore and China, to name only a handful of more notable
markets. This proliferation is in response to the financial market's
increasing awareness of the return potential from small business
investments. Small business accounts for the majority of the global gross
domestic product (GDP) and the majority of global employment. Even in the
United States, over fifty percent (50%) of domestic GDP and employment
comes from small business. The small business market space has always been
a vital market segment, rich with investment potential. Now, the OTCBB is
pioneering the opportunity for middle income investors to participate in
and benefit from the small business market space. The rest of the world's
financial markets are following the OTCBB's lead. Investment in publicly
listed small businesses is growing rapidly every year.
Overcoming the Pitfalls of the OTCBB; Improving the Caliber of Participants
The OTCBB is not without its pitfalls. Most investors with experience
involving OTCBB listed companies have had one or more unfortunate
experiences. The potential of the OTCBB to grow into a globally recognized
premier small business exchange is often masked by those unfortunate
experiences. The success of the OTCBB and the public small business market
at large will depend not only on the regulators ability to improve the
oversight process, but even more importantly on the increased caliber of
small business issuers, institutional investors, and retail investors. Any
place money is exchanged will inevitably attract its fair share of
society's thieves attempting to profit through deceit and scam. As the
benefits of any environment where money is exchanged become more
recognized, the caliber of new participants improves and in turn mitigates
the efforts of society's thieves.
NewMarket's Lessons Learned and Contributions to the OTCBB
NewMarket and its 13,000 stakeholders are an example of the increasing
caliber of small business public market participants. The NewMarket
crusade has been active for half the life of the OTCBB. Not only are we an
example of the increasing caliber of participants, we are making a
contribution to the overall improvement of the market. The approximate
median market cap of OTCBB listed companies is $8 million and the
approximate median revenue of OTCBB listed companies is $5 million. When
NewMarket started on the OTCBB over five years ago, the Company's market
cap and revenue were well below the OTCBB's medians. Today, the Company's
approximate $40 million market cap and $100 million in annualized revenue
is well above the OTCBB medians. That progress has taught the Company many
lessons about the OTCBB environment. We are making a contribution by
sharing those lessons with other retail investors and other OTCBB issuers.
NewMarket's Lessons Learned and Contributions to its Stakeholders
The lessons learned are of course improving NewMarket's prospects in
addition to making an overall contribution to the OTCBB at large. The
specifics of NewMarket's vision to establish a recognized, respectable and
repeatable early stage investment scenario include building the Company
into a national exchange listed company managing a portfolio of micro-cap
listed subsidiaries where subsidiary stock produces dividends for NewMarket
shareholders. NewMarket's vision has never changed, though the challenges
of realizing the vision have become more clear. The challenges are not
insurmountable, but do require management to modify plans.
National Exchange Listing, Independent Subsidiary Listing and Dividends
NewMarket has approached a national exchange listing from a few different
perspectives, to include direct listings and reverse mergers. Some of
these efforts have been publicly disclosed. The Company has also
approached the independent listing of subsidiary operations from a few
different perspectives. We have learned a number of lessons about the
complexities of consolidating the financial statements of multiple public
companies, in addition to the challenges of listing foreign operations on a
US exchange. We are better prepared now, more than ever before, to move
forward with additional independent listings. In conjunction with the
challenges of executing on plans to independently list subsidiary
operations, we have faced issues with plans to issue dividends to NewMarket
shareholders in conjunction with the independent listing of subsidiary
operations. Again, we are better prepared now, more than ever before, to
move forward with issuing dividends in conjunction with the independent
listing of subsidiary operations.
A Milestone Investment and the Next Step Toward the NewMarket Vision
After five years of entrepreneurial growth, funded primarily through cash
produced by operations and supplemented by ongoing founder investment,
NewMarket established its first institutional investment relationship in
the fourth quarter of last year. In conjunction with that investment, the
Company recently filed its first registration statement in five years. The
institutional investment is serving as a platform for the Company's next
step toward realizing its vision.
First Edition in a Series of Stakeholder Letters
Over the next few weeks, I will release a series of letters to elaborate on
the Company's updated plans to continue the independent listing of
subsidiary companies in addition to expanding the portfolio of subsidiary
companies through acquisition.
Highlights regarding NewMarket's Mobility Computing expansion and
independent listing in addition to our attempt to acquire the operational
assets of Pegasus Wireless Corporation have already been disclosed.
Further details will be released within the upcoming series of letters
elaborating on the Company's updated growth plans. Additional acquisition
initiatives and independent listing initiatives will also be released. The
series of letters will include an update on the Company's plans to list on
a national exchange and the Company's updated dividend plan.
NewMarket Gratitude and Commitment to Stakeholders
All of us working here at NewMarket are excited about the Company's
progress to date and enthusiastic about our anticipated progress in 2008.
We are grateful for the patience, feedback and support of our stakeholders.
With a market capitalization value less than the book value of the Company,
we understand the frustration expressed by some of our stakeholders. We
welcome that frustration as an expression of every stakeholder's commitment
to the NewMarket vision and corresponding desire to see the vision
realized. I have every confidence that with the execution of the updated
plan, every NewMarket stakeholder will enjoy the benefit of the Company's
fundamental financial value aligning with the market capitalization value.
Even more substantially, I have every confidence NewMarket will continue to
exemplify the best potential of the public small business marketplace
through the Company's ongoing revenue growth and ongoing profitability
leading to the establishment of a regular and continuous issue of
shareholder dividends.
A Call to Action
I am sure many of you are investors in other publicly listed small
companies. As part of NewMarket's vision and commitment to a higher
purpose, I ask that you consider forwarding our letter on to the management
of the other publicly listed small companies in which you invest and
encourage them to contact NewMarket so we can start a dialogue to share
lessons learned from our respective experiences and combine efforts to
improve the market place in which we all participate.
Believe in the Small Business Marketplace,
Philip Verges
CEO
NewMarket Technology, Inc.
To be added to NewMarket's corporate e-mail list for shareholders and
interested investors, please send an e-mail to ir@newmarkettechnology.com
About NewMarket Latin America, Inc. (www.newmarketlatinamerica.com)
NewMarket Latin America is a consolidated subsidiary of NewMarket
Technology providing world class systems integration services through
relationships with Hyperion, Oracle, SAP, SSA Global, Microsoft and many
more. NewMarket Latin America has major customers in various sectors such
as Oil and Gas, Consumer Products, Financial Services, and Pharmaceuticals
Industries.
NewMarket Latin America deliver solutions to regional customers in addition
to specializing in helping US clients expand their businesses and
operations into one of the fastest growing economic regions in the world.
NewMarket Latin America has offices and operations throughout Latin
America.
NewMarket Latin America also identifies emerging technologies developed
within the region and brings those latest technologies to market worldwide.
These innovations help clients grow their businesses and gain a new
competitive advantage.
About NewMarket China, Inc. (www.newmarketchina.com)
NewMarket China, Inc. is a technology leader in the rapidly developing
Chinese market specializing today in software engineering, high quality
software development and digital multimedia outsourcing services delivered
to customers globally. At the same time, the firm is a systems integrator
and value added reseller of major global hardware brands in the Chinese
domestic market.
Headquartered in Dallas with operations in Shanghai and Beijing, NewMarket
China bridges the gap between Western and Eastern business cultures to
assist western clients in realizing the advantages of the high quality, low
cost technology products and services available from China. NewMarket
China also assists Western clients in localizing products and services to
realize the tremendous growth potential available by expanding into the
Chinese Market.
About NewMarket Technology, Inc. (www.newmarkettechnology.com)
NewMarket helps clients maintain the delicate balance between maintaining
legacy systems and gaining a competitive edge from the latest technology
innovations. NewMarket provides certified integration and maintenance
services to support the prevailing industry standard solutions such as
Microsoft, Oracle, SAP, Siebel and Sun Microsystems. Concurrently,
NewMarket continuously seeks to acquire emerging technology assets to
incorporate into an overall product portfolio carefully packaged to
complement the prevailing industry standard solutions. Some emerging
technology solutions NewMarket provides include VoIP, Broadband Wireless
and Security.
NewMarket delivers its portfolio of products and services through its
network of Solution Integration subsidiaries in North America and the
leading emerging markets around the world to include, Latin America, China
and Singapore.
NewMarket ranked Number One in Texas, Number Three in the United States and
Number Five in North America on Deloitte's 2006 Technology Fast 500, a
ranking of the 500 fastest growing technology, media, telecommunications
and life sciences companies in North America. Rankings are based on
percentage revenue growth over five years, from 2001-2005. The Company grew
from less than $1 million in revenue in 2001 to over $50 million in
profitable revenue in 2005. In 2006, the company continued its rapid
growth, reporting $77.6 million in revenue with a net income of $5.8
million.
"SAFE HARBOR STATEMENT" UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT
OF 1995
This press release contains forward-looking statements that involve risks
and uncertainties. The statements in this release are forward-looking
statements that are made pursuant to safe harbor provision of the Private
Securities Litigation Reform Act of 1995. Actual results, events and
performance could vary materially from those contemplated by these
forward-looking statements. These statements involve known and unknown
risks and uncertainties, which may cause NewMarket's actual results in
future periods to differ materially from results expressed or implied by
forward-looking statements. These risks and uncertainties include, among
other things, product demand and market competition. You should
independently investigate and fully understand all risks before making
investment decisions.