DALLAS, TX--(Marketwire - February 17, 2009) - NewMarket Technology, Inc. (
PINKSHEETS:
NMKT)
today released an update on its plan to issue shareholder dividends. The
Company has launched operations in Brazil and China in recent years.
Management intends to provide a return on the regional startup investments
through a dividend distribution. The regional operations have been central
to NewMarket's rapid growth from less than $1 million in revenue in 2002 to
a profitable $93 million in 2007. The Company continued to grow in 2008
with improved operating margins, and management anticipates continued
growth from its Chinese and Brazilian operations in 2009.
NewMarket CEO Philip M. Verges has written a letter to shareholders on the
Company's plan to issue dividends in conjunction with the Company's
continued expansion in Brazil and China. The letter is included in its
entirety within this press release.
Dear Fellow Shareholders:
The majority of NewMarket's sales come from the world's leading emerging
markets. While most of the world's developed economies are facing a
negative, or potentially negative, GDP growth rate, much of the world's
emerging markets are showing signs of continued growth. While that growth
has been slowed as a result of the global financial crisis, the emerging
markets are anticipated by many to recover sooner than the developed
economic regions of the world.
NewMarket started expanding into emerging markets by first entering South
East Asia in 2003. The Company subsequently continued its emerging market
expansion into China and Latin America, with its largest Latin American
operation in Brazil. Recently, the Company initiated efforts to open
operations in East Africa.
Internet and information technology penetration is largely saturated in the
world's developed economies. Technology growth in developed economies has
to be squeezed out of next generation technology updates. In difficult
economic times, customers are less likely to make next generation
technology investments. On the other hand, emerging economic regions have
lower internet and information technology penetration. Continued growth
from the expansion of basic technology infrastructure in emerging economies
is far more likely than growth from the sale of next generation technology
that replaces existing technology infrastructure in developed economies.
NewMarket will continue its strategy to sell technology products and
services in the world's emerging markets. We will take lessons learned
from our experience in recent years and improve our emerging market growth
strategy.
NewMarket has utilized the public micro cap financial market to facilitate
its growth. The Company's growth from less than $1 million in revenue in
2002 to reporting a profitable $93 million in 2007 has been exceptional.
In previous years, NewMarket shareholders have also had the opportunity to
enjoy dramatic share price increases. Unfortunately, in more recent years,
the share price has trended down. The global financial crisis has not
helped the situation, but management has also learned additional lessons
specific to the public micro cap financial market that can be leveraged to
improve upon the disappointing share price performance of recent years.
Management's overall strategy to improve share price, bringing it more in
line with the Company's fundamental financial performance, is to move
NewMarket to an exchange listing. An exchange listing, however, is not the
only measure management plans to take to improve share price.
Originally, management intended to build a public holding company of public
companies. Management intended to independently list each of its regional
subsidiaries. The anticipated benefit of the independently listed
subsidiaries was centered on a plan to distribute stock in the
independently listed subsidiaries as dividends to shareholders of the
parent company.
The anticipated strategy has proved more difficult in practice than
principle. Furthermore, the relative originality and creativity of the
idea has not been readily embraced by institutional investors. In the
Company's future expansion into additional emerging markets, management is
moving away from the public holding company of public companies concept.
However, management will remain committed in the instance of China and
Brazil to the independent listing and dividend strategy.
The Company's independent regional listings have experienced various issues
as NewMarket management has encountered a number of unanticipated
challenges with its public holding company of public companies strategy.
The Chinese subsidiary is listed as an OTCBB company and, as the majority
shareholder, NewMarket is restructuring the share structure to facilitate a
timely dividend of Chinese subsidiary stock to NewMarket shareholders.
The Brazilian subsidiary independent listing has been more problematic. To
overcome the issues encountered with the independent public listing of the
Brazilian company, the public company has been deregistered and is in the
process of being reregistered. The registration process requires the
completion of the 2008 financial audit. Once the audit is complete, the
required filing process will take approximately 60 days. The 60 day time
frame estimate is largely based on the regulatory requirement to permit
adequate time for review of the various filings necessary to register the
Company.
We will continue to issue updates on our plans to issue dividends in
conjunction with NewMarket's operations in China and Brazil. We have
already provided an overview on the Company's updated strategy to support
continued growth in emerging markets beyond the public holding company of
public companies strategy. An overview of the Company's Greenfield
strategy for continued emerging market growth can be viewed at:
http://www.newmarkettechnology.com/media.htm and is titled, "FY2008 Virtual
Town Hall Meeting: January 2009 Part 3 of 4."
The global financial crisis has or will create issue for most individuals
and companies alike. At the same time, the crisis will also hold new
opportunities. NewMarket management believes that the Company's previous
investment in establishing emerging market technology service centers will
now be the foundation of an exceptional opportunity in the midst of a
global financial crisis. Management anticipates increased sales from
emerging markets as the technology market looks for growth elsewhere while
the developed economic regions of the world put technology investments on
hold. NewMarket has a foothold and valuable experience in emerging markets
and is prepared to capitalize on a technology market concentration shift to
the emerging economic market place.
Sincerely,
Philip M. Verges
Founder and CEO
NewMarket Technology, Inc.
Corporate E-mail Updates
To be added to NewMarket Technology's e-mail database to receive company
updates or to obtain more information on the Company, please send an e-mail
to
ir@newmarkettechnology.com or call 214-722-3065.
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 systems integration and
maintenance services to support the prevailing industry standard solutions
from companies such as Microsoft, Oracle, Infor, Cisco Systems, 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.
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.
The company has continued its rapid growth, reporting $77.6 million in
revenue with a net income of $5.8 million in 2006 and most recently $93.1
million in revenue with a net income of $7.3 million in 2007.
"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.
Contact Information: Contact:
NewMarket Technology, Inc.
Investor Relations
214-722-3065
ir@newmarkettechnology.com