CRVH Chilco River Holdings Inc (CE)

Dutton Associates updates its coverage of Chilco River Holdings (OTCBB:CRVH) raising its rating to Speculative buy with a $.75 price target. The 6-page report by Dutton senior analyst Gerald F. LaKarnafeaux, CFA, is available at www.jmdutton.com as well as from First Call, Bloomberg, Zacks, Reuters, Knobias, and other leading financial portals. Chilco River Holdings (Chilco) is currently offering, on a best-efforts basis, an issue of 11% convertible debentures. The amount of the offering is a range of $1.0 million to $10.0 million. Placing at least half of the offering will enable the Company to re-open the Bruce Hotel and Casino in August. Considering the earning potential of the Bruce facility, we believe our rating change from Neutral to a Speculative Buy, with a 12-month target price of $0.75 per share is warranted. For the year ending December 31, 2006, the Company reported revenues of $1.6 million, down from $4.6 million in the prior year. Total operating expenses, including depreciation of $752,000 were $4.6 million, up from 2005 operating expenses of $3.5 million including depreciation of $956,000. The net loss for the year was ($3.5 million) or ($0.07) per share, compared to a 2005 net profit of $581,383 or $0.01 per share. The Company�s current cash position appears less precarious compared to year-end 2006 due to the convertible debenture offering. There is a factor to be considered in judging the liquidity risk. The scaled-down Bruce operation is still generating positive cash flow from the old slot machine rentals, hotel, food and beverage revenues. Bruce�s net income is roughly at a breakeven level. The loss in 2006 is the result of G&A expenses at the corporate level. About Dutton Associates Dutton Associates is one of the largest independent investment research firms in the U.S. Its 31 senior analysts are primarily CFAs, and have expertise in many industries. Dutton Associates provides continuing analyst coverage of over 145 enrolled companies, and its research, estimates, and ratings are carried in all the major databases serving institutions and online investors. The cost of enrollment in our one-year continuing research program is US $35,000 prepaid for 4 Research Reports, typically published quarterly, and requisite Research Notes. Dutton Associates received $35,000 from the Company for 4 Research Reports with coverage commencing on 8/29/2006. We do not accept payment of our fees in company stock. Our principals and analysts are prohibited from owning or trading in securities of covered companies. The views expressed in this research report accurately reflect the analyst's personal views about the subject securities or issuer. Neither the analyst's compensation nor the compensation received by us is in any way related to the specific ratings or views contained in this research report or note. Please read full disclosures and analyst background at www.jmdutton.com before investing.