LAS VEGAS, NV, Feb. 9 /PRNewswire-FirstCall/ -- Cash Now Corporation (CHNW.PK) http://www.cashnow.com/ (Cash Now), CEO Garr Winters comments on recent and upcoming achievements for Cash Now Corporation. I would like to take this opportunity to update all of our shareholders and those following our stock with this long overdue "President's Message." It's been an exciting few weeks since I took on the position of CEO. As there has been a lot of news announced recently, and our business plans continue to roll-out, I wanted to take the opportunity to step back and discuss our achievements as well as business opportunities moving forward.
Continuing Operations:
As many of our shareholders are aware, we are continuing to make good progress within the Payday Loan business aggregation industry. This is after having our active operations virtually suspended, or shall I say on "life support system" between August 2005 and July 2006. This suspension was primarily due to the severe hurricane related damage to our Florida offices, and constant business interruptions that followed. This was compounded by the fact that we had just started closing our Toronto Canada head office and started migrating the whole infrastructure and operations to Florida.
Luckily, we are nothing if not resilient. For example, our staff and contractors had to work from home and in remote offices in Canada. I am proud that the team all pulled together to regroup and to reinstate Cash Now and get it back to full operational status.
I can safely say that our infrastructure, Internet operations, management and key staff are at back at full bench strength. I know this from personal experience, having started with the company as a sales consultant many years ago. On my journey to becoming CEO, I have been responsible for nearly every aspect of Company operations at one point or another. Most people that I consider good friends and colleagues tell me that Cash Now is my complete passion. I would have to say that this assertion is not too far from the truth.
Moving forward, and now that this interruption is behind us, our focus in this industry will continue to emphasize licensing of our comprehensive suite of sub-prime financial services software products. Over the years, we have developed a comprehensive and sophisticated set of Internet based services. With the bulk of R&D complete, our burn rate is low, and incremental revenue beyond the break even point of fixed costs generates very attractive gross margins.
What's Next :
Our immediate plans are to sell off our "non core" business models that encompassed Cash Now. We are hoping that the sale of these assets will further enhance our capitalization without the need to secure additional financing through debt or otherwise.
In the very near future, we are planning on launching our retail Forex trading service.
Management believes that Forex trading offers geometric growth potential. The Forex market offers huge potential. According to International Financial Services, London, the average daily global turnover in traditional foreign exchange market transactions totaled $2.7 trillion in April. Foreign exchange trading increased by 37% between April 2005 and April 2006 and has more than doubled since 2001. It is estimated that retail trades represent only 2% of the total market.
We have previously announced the establishment of an introductory broker agreement with Advanced Markets. Based on this, we are coming to market with an innovative new approach aimed at the seasoned day trader. Just this week, Mr.Richard Schacchatano, our Forex Development Manager, began the search for a full service Forex Broker Dealer agency. His efforts and our ambitions to enter the Forex market have began producing opportunities for new strategic partnerships and business relationships.
Cash Now is positioning itself quite uniquely, and perhaps to some degree with an innovative approach that has not been explored before by traditional retail Forex marketers.
We are not looking to grow the market by attracting new participants, a common approach of most Internet-based trading platforms. Our target market is experienced Forex traders who want the absolute best deal available. They don't need educational tools. They want a 2 pip spread that really is a 2 pip spread. The traders want transparency, immediate transactions, and a live feed directly off the Electronics Banking System.
How are we different than our competitors? The advertising claims may sounds similar, but, like an iceberg, 90% of the story is beneath the surface. It is fair to say that Cash Now has always challenged the conventional way of thinking and the conventional wisdom. I will try to explain how our approach will yield long term results, with a defensible position against competitors.
Essentially, the spread quoted on virtually all retail trading platforms, is not a direct feed from the Interbank Quote. Brokers are regulated by FCM as a "market maker." As such, they are required to post both bid and sell prices. However, because they make the market, they get to establish the final buy and sale quotes on their retail trading platforms.
Simply put, they are not required to quote the current "exact" Interbank rate at the time a trade is placed, and often trail the Interbank market. Thus, it may appear that traders are receiving a 2 pip spread, while in reality, it may be significantly larger.
We have found that experienced traders eventually pay for their own live feeds on the Forex, and eventually figure out that pips are somehow disappearing in their trading.
This is our target market!
With our IB relationship, we will offer true "straight pass-through Forex dealing." No slippage or skuing, and no dealing desk. Our clients will be hooked up directly to a platform originally designed for institutional traders with $100 million plus positions. There is no intermediary retail platform, and no capability to manipulate the quoted bid/ask.
We feel strongly, and conventional wisdom concurs, that Cash Now will attract serious day traders, who are actively trading large positions. They will be charged an honest 2-3 pips depending on the currency pair, directly off the Interbank rate. They will also pay a small transaction fee for each trade. As the word spreads through the industry of the services offered by Cash Now and its affiliates and as our advertising budget and revenue stream increase, we feel confident that our client base will grow organically.
In summary, we see parallels in retail Forex market development similar to the growth of discount stock trading. It will continue to grow geometrically. Active traders will demand the lowest price options, and will find them.
We intend to leapfrog the market, and offer seasoned traders a true discount service.
This is the Cash Now vision.
Timing:
Our goal is to have our Forex Beta site up and running by the end of February. Full live trading services are targeted to be live early in the second quarter.
Corporate Vision:
We believe that we have vital core competencies in Internet delivered financial services to a consumer market. As such, we will look for additional business opportunities that have the following attributes:
- Consumer facing
- Financial Services
- Internet delivered
We are exploring some longer term product opportunities that we have identified during the last few months. These are in line with our corporate mandate, and represent additional opportunities to offer horizontal expansion of our product/service portfolio.
We will also be actively exploring vertical integration opportunities within our new Forex financial service offerings. Our roots are in the Internet and franchising. One possible revenue stream that we are seriously exploring is the idea of offering the Cash Now model as a franchise or an Agency type relationship. This could add more revenue and more clients to our system.
These opportunities will continue to be explored, however, our short term focus is squarely on developing our Forex trading platform.
Corporate Activity:
We are striving to provide our shareholders with value to the best of our abilities. This has been hampered recently, in our opinion, by aggressive short trading.
Additionally, the Cash Now name that has served us so well in the past, is no longer an adequate description of our corporate activities. It is our intent to register a new corporate name, trading symbol and CUSIP Number. We have conducted a thoroughly exhaustive name search and have chosen the one that we feel will accurately describe our business activities and the model. We have instructed our advisors and our agents to begin the process of registering Esprit Financial Group Inc as our new name. This will more accurately reflect our business activities moving forward.
For those shareholders wondering about financing, I can advise you that we are not currently seeking additional funding to support our Forex launch. We believe our capital position is adequate to bring this new division into full operation.
Importantly, these actions, when taken together, will force short sellers to close off their positions against the Company, and reduce the downward drag on our stock price in the recent past.
With the launch of our new Forex product, we believe short sellers will have to move to the sidelines. Simply put, we have a strong belief that our Forex business will add very significant value to the Company, and will drive aggressive growth moving forward. Shorting our stock will carry a significantly greater risk.
I will continue to strive to ensure our corporate activities are as transparent as possible, and continue to issue news as the Company moves forward with our Forex launch and other activities.
About Cash Now
Cash Now Corporation, a pioneer in the payday loan industry, is developing the most comprehensive menu of services in the cash advance industry, all centered on the Cash Now brand. The company's proven business model includes licensing to corporately operate locations across the U.S. and Canada. Additionally, Cash Now's Web site is the most advanced payday-lending portal, offering key insight to clients and potential clients alike. Cash Now offers a payday loan license program, Payday Express; and a payday loan and check cashing license known as Check Express.
The Company is currently in the process of expanding its product portfolio by bringing a retail Forex trading platform to market, targeted to seasoned day traders.
Safe Harbor Statement
Information in this press release may contain 'forward-looking statements.' Statements describing objectives or goals or the Company's future plans are also forward-looking statements and are subject to risks and uncertainties, including the financial performance of the Company and market valuations of its stock, which could cause actual results to differ materially from those anticipated. Forward-looking statements in this news release are made pursuant to the 'Safe Harbor' provisions of the United States Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties, including, without limitation, risks relating to the ability to close transactions being contemplated, risks related to sales, continued acceptance of Cash Now's products, increased levels of competition, technological changes, dependence on intellectual property rights and other risks detailed from time to time in Cash Now's periodic reports filed with the regulatory authorities.
