With their second major contract over the period from January – April 2012 secured Perla Group International (PINKSHEETS: PERL) has already quadrupled the revenues generated from fiscal year 2011 and the company, which provides international military, police and security solutions through a number of divisions, believes the revenue growth should continue throughout the year and put them in position for further expansion.
PERL President and CEO Charles D’Alberto stated in Thursday’s press release announcing the second major contract, “We are truly delighted at this outstanding achievement in the company’s growth. To achieve this revenue growth in only 4 months into the 2012 year represents an unprecedented event in the company’s 5 year history. This dramatic increase in revenue demonstrates how extraordinary the growth in our sector/company is, and excites us moving forward.”
Thursday’s announcement was in regards to a contract to supply Toyota 4×4 vehicles to a major Iraqi distributor, pushing revenue for the first four months of 2012 to over $12 million. That figure is quite impressive when comparing it to the $3.1 million in total revenues for the fiscal year 2011. Back on April 11, 2012 PERL announced they had signed a purchase order valued at $6.25 million for the immediate supply of Toyota Pick-up Trucks to be delivered into the West Africa Region. This purchase order represents the largest order in the company’s history and instantly doubled PERL’s revenues from the previous year.
Both of these contracts come from PERL’s Perla Armored Cars division, an entity that specializes in armored VIP Mercedes Benz, as well as 4 x 4s, APCs, Cash in Transit, Buses and ATVs. This division generated nearly $1.4 million in revenues for PERL in 2011, almost half their total sales, and it appears as if PERL will continue to rely on the division to anchor revenue going forward.
That being said, PERL has assured investors that their plans to acquire new companies to build on their Perla Aviation division remain intact. Primarily positioned in the Middle East, this division provides a number of aviation services including charters, sales and leasing of aircraft; aircraft repair and maintenance. Perla Aviation is also the exclusive distributor for the AK1-3 helicopter, known industry wide as the finest two seat helicopter available. Revenue from this division amounted to just over $465,000 in 2011 and PERL is hoping to boost that considerably through acquisitions.
Aside from the Armored Cars and Aviation divisions PERL also has a K-9 Services division which was actually responsible for $845,000 in revenue for fiscal year 2011. This division offers “the finest breed dogs trained under the best in the industry. Perla K-9 services are utilized by law enforcement and as detection dogs. They conduct training seminars as well as tactical, anti-terrorism and security training services.”
PERL has not outlined any plan for growth in this division heading forward but knowing that it accounted for more than a quarter of their revenue last year they may be looking at ways to expand on the business. Of course it should also be noted that all of this division’s revenue was generated in the first half of 2011 so investors may not want to rely too heavily on a repeat performance in 2012.
Another possible cause for concern with PERL is that while they generated just over $3.1 million in revenues for fiscal 2011 their expenses were north of $2.7 million, leaving them with a profit of a little more than $361,000. Unfortunately for investors PERL doesn’t give a detailed breakdown concerning expenses from each division, meaning the profit margin from the Armored Cars division may not have been as high as the K-9 services division. In fact, the expenses associated with the Armored Cars division may have exceeded the revenues generated from the sales. That may be unlikely but PERL isn’t providing the details.
Despite the questions that still remain PERL would appear to be an interesting bet for investors, especially given the fact that their share price was as low as 0.0075 on May 1, 2012 but have since climbed as high as 0.0170 on Friday with volume topping the 2.3 million mark in the first two hours of trading. Shares are currently moving around 0.0110, dead even with their 50-day moving average and with a pair of contracts already announced in the first four months of 2012 PERL could be positioning itself for a steady climb.
