Vision Plasma Systems, Inc. (PINKSHEETS: VLNX) has shot through the roof in early trading on Thursday with or than 180 million shares trading hands within the first hour and the price jumping from an opening of 0.1350 to a high of 0.3300. Currently shares are moving around the 0.2650 range, leaving many to question just how long the technology company can maintain such an elevated price.
Those questions exist for a number of reasons, one of which is the fact that Thursday’s surge comes despite no news being released by the company. In fact, the last bit of news VLNX released was back in late June when they announced details concerning a meeting with Brazilian business advisors to negotiate terms for the production of their proprietary Arc Master I units in Brazil.
Unfortunately details of the outcome were minimal at best other than stating it “outlined Brazil’s interest in increasing their business trade with North America, South America and Africa over the next few years.” That didn’t specifically mention an interest in producing VLNX’s Arc Master I units.
According to VLNX the Arc Master I mobile unit “was designed to deploy a clean and green remediation solution to various worldwide corporations, military, government, and municipal customers. The unit is capable of converting up to 5 tons per day of hazardous wastes and other matter into syngas, net electricity, and recyclable metal ingot, without any air emissions or ash from the gasification process. Built inside two (2) ISO 40’ metal containers, The Arc Master I can be easily transported by truck, rail, ship, or plane worldwide to provide an fast and mobile solution to the remediation of all forms of waste. The Arc Master I mobile unit is entirely self-powering, creating its own energy from the waste that it processes, and creating up to 240KW of usable electricity at the site.”
While all of that sounds like the makings of a wonderful product the fact is it’s not currently being produced so VLNX has nothing on the market. This is why they reported no revenue for 2011 or 2012 thus far and have listed no assets, a troubling fact for investors.
In VLNX’s most recent quarterly report published on August 12, 2012 the company lists a number of advantages linked to their Arc Master I, among them:
• Ideally suited for handling all hazardous materials (hazmat) including medical and pharmacological wastes
• Can be located close to the source of hazmat, which largely eliminates the need for long haul transportation of dangerous materials on highway, rail and barge systems
• Can be up and operating within one hour of arrival on site
• Excess power of 200-300KW is available for local purposes
• Has a unique business services model in that several systems can be assigned to a given region
• For national disasters these systems can also be called on en masse to respond to process hazardous wastes
• The Arc Master I system can be transported in the C17 and similar aircraft
• Can be ruggedized for military forward operating base needs.
• Arc Master I can greatly reduce the environmental impact of combat operations
• Costs of remediation are completely competitive with current incineration and dumping costs
Arc Master I Mobility
Again, all of this is great but these advantages based on something outside of real world experience thus far. VLNX states that because there are no mobile plasma gasification systems operating in the world there is essentially no direct competition for their product. On the other hand, there is plenty of competition from major waste management companies who are engaged in the disposition of medical and hazardous waste materials.
Those major waste management companies are on significantly better financial ground than VLNX at the moment and they also have considerably more influence in the market. There is also the matter of the intellectual property used by VLNX and the delicate nature of their hold on this property as they noted in their quarterly report, “The process of seeking patent, industrial design and trademark protection can be time consuming and expensive and there can be no assurance that patents, industrial design registrations or trademark registrations will issue from future applications or that the existing intellectual property rights used by Vision Plasma Systems, Inc. or any new patents, industrial design registrations or trademark registrations that may be issued will be sufficient in scope or strength to provide meaningful protection or any commercial advantage. There can be no assurance that any pending or future patent, industrial design or trademark applications will be granted in respect of the technology used by VPS or that any existing, pending or future patents, industrial design registrations or trademark registrations will not be challenged, invalidated, ignored, circumvented or otherwise rendered unenforceable.”
At present VLNX remains a significant risk and with their share price hitting levels that don’t appear warranted investors may be wise to exercise considerable caution before moving forward.