Morning all. As is always the case with a morning edition of the newsletter, there's news from our Featured Stocks... two of them this time, actually. And it can't wait. Their respective news could move each stock.
One of the companies in question is Double Crown Resources (DDCC). You'll recall this is the outfit that developed an ingenious way of shipping things like rice or gravel or iron ore pellets.... commodities normally shipped in the hulls of giant ships, in dump trucks, or in train cars called gondolas (the big rolling vats). Rather than constantly pouring them in and dumping them out every time a shipment has to aggregated or split up, Double Crown came up with the idea of a shipping container that also serves as the dispenser. The whole kit and caboodle is loaded up at the supplier's plant, and shipped as a unit all the way to its final destination; the goods themselves never need to be touched en route. The customer just gets the whole box, and then sends it back empty when they're done with it.
The nearby image is one of these shipping/dispenser containers, called Translock2 (or Translock-Squared). If it looks familiar, they should. They're the size, shape and concept of am intermodal container -- completely stackable -- but they make it easy to access the material without a loader or a shovel.
This is a big deal. The less often the drybulk commodities being delivered are touched, the less loss there is. It's also just cheaper, as no middleman has to bother splitting anything up and weighing the goods. It's not hyperbole to say this could revolutionize the shipping industry. Now ships that are normally used to ferry intermodal containers can transport bulk commodities. More options means lower costs.
And the opportunity is big. Approximately $30 billion is spent every year delivering drybulk goods. From a sheer tonnage perspective, about 4 billion tons of drybulk goods were shipped by sea last year alone; much of that tonnage could have easily been shipped in Translock2 containers.
There's just one nuance about coming up with this kind of idea for a physical, design-oriented invention -- there are people rivals who will try to rip your idea off by copying it for themselves. That's not going to be a problem for Double Crown Resources, however, as it's got a library of patents in the works covering the design of Translock2. The first of what will be several patents was just officially issued by the U.S. Patent Office, after being scheduled for issuance on this day a couple of weeks ago.
You can look it up for yourself, if you want to see it. Its patent number 9428330. It's the one that protects the whole concept of a stackable commodity-shipping container..
There are three more patents in the works, two of which have already been filed. The other is being prepared right now. These will cover modifications and additions to the Translock2 design since the first patent request was submitted.
This is one of the biggest steps Double Crown needed to take in order to move to the next phase of its plan, which is selling licenses to other companies that would like to make and sell these containers. The company is already in discussions with manufacturers that may want to use some or all of the Translock2 design.
For perspective, a new intermodal container costs between $1000 and $4000 each. Though DDCC would only collect a fraction of that amount as a royalty payment, again, 4 billion tons of drybulk goods were shipped by sea alone last year, and these things work on a flatbed truck as well as on rails. It would only take a few bucks per container to become a real licensing windfall for Double Crown Resources. And it's all starting to move just now.
The market may see this news as a catalyst for the stock.
In any case, did everybody see the fourth quarter and full-year numbers reported by IT staffing outfit Staffing 360 Solutions (STAF) yesterday? They were posted after the close, and not surprisingly, they were good.
Most of them we already knew. That is, we knew revenue was going to roll in at $44.0 million (up 36% year-over-year), and EBITDA would be $1.0 million, versus am EBITDA loss of $1.9 million in the fourth quarter of the prior year. What we didn't know then but know now was net income and operational cash flow. Both were well up from year-ago levels too. The net loss of $2.8 million was much smaller than the prior year's Q4 loss of $4.3 million, and the operational cash flow was basically even, versus negative cash flow of $4.5 million for the same quarter a year earlier.
Like the chart of it all below shows, Staffing 360 Solutions is a growth story, plain and simple.
Positive net income is on the horizon. A couple more acquisitions could do the trick. I have to think, though, the market is starting to see the writing on the wall. This could really start to draw the buyers out in front of that swing to a profit.
As a refresher, Staffing 360 Solutions is ultimately aiming for $300 million in annual revenue, driven by a couple dozen or so acquisitions. It's got six deals under its belt already in just a couple years, and look a what's already happened.
As for the opportunity, chew on these numbers: According to the Bureau of Labor Statistics, software and developer positions will grow by 19% between 2014 and 2024, making it one of the nation's fastest-growing non-medical career choices. When you broaden the data out to "computer and mathematical occupations", the ten-year growth projection is 13.1%, which IS the second-highest growth pace among all jobs (second only to healthcare).
Better still, in late-2015 technology industry information provider CompTIA noted in its 2016 outlook "Based on how 2015 data is tracking, the year could record the highest IT job growth rate in over a decade." The outlook is made even more compelling by an interesting data nugget... although the United States' overall unemployment rate is 4.9%, within the IT world, the unemployment rate is a mere 2.6%.
You don't have to do a lot of thinking to realize IT staffing is a growth industry.
It's still highly fragmented industry though. There are roughly 70,000 staffing agencies worldwide. The biggest ten of those firms collectively win only about a third of the industry's total business, while the other 69,990 firms split the remaining $200 billion or so worth of annual revenue. Even within the United States, the biggest 50 of the nation's 32,000 staffing firms only split 40% of the $220 billion spent each year on temporary U.S. workers.
That's inefficient and ineffective. For an enterprising company willing to consolidate those pieces, however, it's an opportunity to improve the situation and make some good money in the process.
Putting it all together, it's tough not to like STAF for the long haul.
Here's the Double Crown Resources press release.
Double Crown Resources Announces Patent Issued Today for Advanced Intermodal Transport System
Additional Patents Following and Active Marketing Negotiations Underway
HENDERSON, NV, August 30, 2016 (GLOBE NEWSWIRE) -- Double Crown Resources, Inc. (DDCC), is pleased to announce that today The United States Patent and Trademark Office has issued patent number 9,428,330 for the interlocking, intermodal commodity transport system called Translock2 (Translock Squared). Additionally, two follow-up patent applications have already been filed and another is now being prepared that all cover key design features of this unparalleled commodity transport and storage system which has major applications in multiple industries across the worldwide marketplace. Double Crown management is currently engaged in direct negotiations with some of the largest companies in the shipping and industrial container business sector regarding licensing contracts for commercial implementation of the Translock2 system. Considerations are also being given to licensing specific Translock2 design features for incorporation into existing container models made by other companies and already in commercial use.
At this time, Double Crown management invites all interested parties to review a very informative trade article entitled The Containerization of Commodities (in The Geography of Transport Systems, 3rd Edition) where author Dr. Jean-Paul Rodrigue (Dept. of Global Studies & Geography, Hofstra University of New York) pointed out that many segments of the raw materials and food commodity chains are in the process of being containerized and that this process is being driven by several factors:
A growing availability of containers in transport markets around the world, making it a rather ubiquitous transport product. Yet, this ubiquity is challenged by shortages of containers and of specific container sizes in some markets.
Economies of scale in bulk shipping making the minimum load unit increasingly large and less accessible to smaller commodity exporters.
A general rise in commodity prices and growing demand in new markets have made many commodities more prone to be containerized from a value proposition standpoint.
Fluctuations and rises in bulk shipping rates have incited the search, when possible, of alternatives to bulk shipping. Volatility also makes long term planning for bulk shipping complex and subject to risks.
Relatively stable and even declining container shipping costs, particularly in light of rising commodity prices, rendered the container even more attractive since shippers can be confident about the stability of container shipping rates.
Global trade imbalances are transcribed in imbalanced container shipping rates, which represent a notable export subsidy for return (backhaul) cargo. For markets having notable imbalances, such as China (exports) and the United States (imports), incentives are acute.
Empty container repositioning has created opportunities by making available pools of empty containers that can be filled for backhauls flows.
A tendency to move processing close to production, particularly in agricultural sectors in developing economies that are focusing on exports for global markets. Unlike unprocessed raw materials or agricultural goods, processed goods are more suitable for containerization. For instance, processed cocoa and cashew nuts are highly suitable for containerization.
Allen E. Lopez, President of Double Crown Resources stated, "The Translock2 intermodal system has no equal in its advantages for the modern containerized macro logistics transport and storage model. The negotiations we are currently engaged in for marketing this new level of technology are making it very clear to us that every company involved in major commodity shipping will want to employ Translock2 in some way for the huge improvements it will bring in terms of cost and time savings, safety, security and environmental protection. With the feedback we have been getting to our Translock2 presentations in the last few weeks we have never been more bullish on the future."
About Double Crown Resources, Inc.
Double Crown Resources, Inc., is a publicly traded company in the natural resources industry. In addition to our minerals and global commodities supply business, we market the patent-pending, multi-advantage container system called Translock2 (Translock Squared). This system is designed for highly efficient, economical and environmentally friendly shipment of aggregate commodities. Additionally, we hold a 100% interest in the Bateman gold and nickel prospect near Thunder Bay, Ontario, Canada. Double Crown Resources, Inc., originally founded in 2006, is based in Henderson, NV with marketing offices in Houston, TX.
Neither this press release nor any related calls or discussions constitutes an offer to sell, or the solicitation of an offer to buy, any securities.
Forward-Looking Statements
You should not place undue reliance on forward-looking statements in this press release. This press release contains forward-looking statements that involve risks and uncertainties. Words such as "will," "anticipates," "believes," "plans," "goal," "expects," "future," "intends," and similar expressions are used to identify these forward-looking statements. Such forward-looking statements include risks and uncertainties, and there are important factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors, risks and uncertainties are discussed in the Company's annual report on Form 10-K for the year ended December 31, 2014 as updated from time to time in our filings with the Securities and Exchange Commission. The Company is not responsible for updating the information contained in this press release beyond the published date, or for changes made to this document by wire services or Internet services. For further information about
Double Crown Resources, Inc., please refer to its website at http://www.doublecrownresources.com.
Double Crown Resources, Inc.
Jerold S. Drew, CEO & Chairman of the Board
10120 S. Eastern Ave. Suite 200
Henderson, Nevada 89052
Phone: (707) 961-6016
Email: info@doublecrownresources.com