Little Falls, NJ --
March 5, 2020 -- InvestorsHub NewsWire
TO SHAREHOLDERS
OF BANTEC
INC.
FISCAL YEAR
ENDED SEPTEMBER 20, 2019
Sales
Our sales
dropped
from
$18,389,568
in 2018
to $10,287,214
in
2019.
The drop
in sales stems from our inability to secure receivables
financing
which
has restricted
the
amount of materials that we can purchase from
our
suppliers.
We have approximately
$3,000,000
in
awarded
purchase
orders that we cannot act on. We believe that for
every dollar we borrow or raise, we can turn that seven to eight
times a year. For example, if we raise $5,000,000,
we believe we can add
$35 to
$40 million in
gross
revenues.
We are
working to secure either debt or equity
financing to increase sales
and, ultimately,
profits.
On a more
positive note, our gross
sales
profit
percentage increased
by
2%.
We
eliminated low-profit
suppliers
and added products that command
higher profit margins. With proper
financing and without
additional expenses, we believe
that
Howco
sales can increase to $30 million
with
a
12%
to 14%
gross profit
margin.
Howco
Distributing Co.
Under difficult
circumstances, Matt Wiles,
our COO and General Manager
of Howco, is doing a tremendous
job managing
our Howco
employee morale while
deploying
scarce
resources
to ensure that
we
capture the most profit possible.
Due
to the spread of the
dangerous and deadly coronavirus, Matt
recently
implemented
our
COVID-19
action plan. Being a supplier to
the US Government,
our
interaction with the general public is limited to
delivery
drivers. Here is a link to our
plan.
http://www.bantecinc.com/coronavirus
Drone USA
LLC.
At Drone USA, we
focused
on developing
a
sophisticated e-commerce
website and
conducting
an
aggressive digital media promotion with the intent of generating
nationwide drone sales at low acquisition costs. In addition,
we established
relationships with various law enforcement agencies in the
tri-state area. We provide
a
one-stop-shop
for police
and
fire
departments
where
they can purchase drones, accessories, training,
COAs,
and
waivers. As
police
and fire
departments slowly
gravitate towards implementing
drone programs, we will be
in a position
to
help
and guide
them.
Bantec
ViroClean Division
In light of the
COVID-19
outbreak, we decided to start a new division. We are
anticipating widespread
COVID-19
infections spreading throughout the United
States.
We see a
demand for decontaminating hospitals, schools, government
buildings,
hotels, cruise ships, and so
on. We intend to help our
fellow citizens through this deadly pandemic.
We
possess
extensive
experience in the methods that will be employed to
clean up
this virus.
As we
decontaminate buildings, we will look to protect our
employees with state art decontamination chambers,
power
air-purifying
respirators, and the best personal
protective equipment.
Bantec
Construction
We recently started
another division.
Presently
we are bidding projects for
hospitals,
city
governments, universities,
and major
manufacturers.
Due to
the COVID-19
outbreak,
we can offer our clients construction services
with employees
trained
and equipped to safely
perform
services under
virus-infected
circumstances.
In addition to
selling products to the US
government through
Howco, we intend to
sell services to the
US Government as
well.
Acquisitions
We
intend
to
acquire companies in the manufacturing,
distribution, and
construction/service
sectors.
Our
acquisition
sweet
spot consists of companies
with
sales of between $2 and
$5 million
where the
owners are considering
retirement.
We
expect
to
structure our details with a small
amount of
cash at closing
with a three to
four-year
earnout.
The
companies we are currently speaking with like
this
structure
rather
than closing their businesses.
Companies
that sell to local, state
governments and our US Government is a plus
for us. We intend to
acquire several companies in a particular
industry. When the time
is right, we will change their
name and market them under the Bantec name.
For example, we would look to acquire several
mechanical contracting companies and ultimately change
their name to our Bantec
Air, our
mechanical contracting division. We will
repeat
this for
Bantec Electric, Bantec
Manufacturing, Bantec
ViroClean,
etc.
Presently, we are
looking at three possible acquisitions.
Our
Vision
OUR
VISION:
IN TWENTY YEARS,
WE INTEND
TO BE THE
LARGEST AND MOST PROFITABLE SUPPLIER OF PRODUCTS AND SERVICES TO
THE LOCAL, STATE GOVERNMENTS AND OUR U.S.
GOVERNMENT.
I borrowed
the
format for this shareholder
letter from Warren Buffet's March
8th,1968 letter to
the
shareholders of Berkshire
Hathaway
Inc.
Forward-Looking Statements
Certain statements in
this press release may be considered "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act
of 1995. These forward-looking statements may include projections
of matters that affect revenue, operating expenses or net earnings;
projections of growth; and assumptions relating to the
foregoing.
Such forward-looking statements are generally qualified by terms
such as: "plans, "anticipates," "expects,"
"believes," or similar words.
Forward-looking statements are inherently subject to risks and
uncertainties, some of which cannot be predicted or qualified.
Future events and actual results could differ materially from
those set forth
in, contemplated by, or
underlying the forward-looking information. These factors
are
discussed in greater detail in
our Form 10 filed with the U.S. Securities and Exchange
Commission.
Michael
J.
Bannon
Chairman
of the
Board
Bantec (PK) (USOTC:BANT)
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