Source: Sack Lunch Productions Inc
Sack Lunch Productions Inc (OTCMKTS:SAKL) has been one of the best performing small caps on the OTC markets rising from a base of $.015 to over $.08 today. This comes as the company is boosting revenues, paying off debts, making acquisitions, and expanding internationally. As management continues to execute, SAKL looks set to continue on its bull run higher.
Sack Lunch Productions Inc is an entertainment company that operates and franchises action oriented events in the U.S. and internationally. SAKL’s events include: Slide the City (1,000 foot long water slide for families and kids), Color Me Rad (5k color race), The Dirty Dash (mud and obstacle run), and The Lantern Fest (nighttime party with lantern lighting and launch). More info can be found at www.sacklunchproductions.com, www.slidethecity.com, www.thelanternfest.com, www.thedirtydash.com, www.colormerad.com, www.trikeriot.com and www.green-endeavors.com.
The company reported ticket sales of $3.07M across all corporate and franchised events in North America from January 1 through March 7. Ticket sales for corporate and franchised events were $1.752M and $1.255M, respectively. The lion’s share of ticket sales was generated by Color Me Rad during January and February. CEO Richard Surber said:
“I am very keen on keeping all shareholders updated on the progress we are making. My intent is to do monthly revenue updates throughout 2016. We will have over 56 event markets open for ticket sales in the month of March which is more than double from the prior month. Our flagship event, Slide the City, will begin opening up a significant number of markets for sale coming into April. Our expectation is that sales will continue to ramp up into the summer months. We remain on track to host in excess of 256 events system-wide in 2016 and expect to generate more than $18M in revenues.”
In December, SAKL increased its ownership from 66.7% to 100% in each of the following entities: Slide the City, LLC, Slide the City Franchising, LLC, Slide the City Canada, LLC, and The Lantern Fest, LLC. The acquisitions were completed for a total purchase price of 417,000 restricted Series A Preferred shares, valued at approximately $4.17 million. Based on forecasted 2016 sales that are expected to exceed $18M, the company expects to earn at least $1 million in additional net income by eliminating the net income and shareholder equity previously attributable to minority interests. The company further anticipates that shareholder equity may improve by as much as $4.17 million. SAKL also paid off a $1.05 million debt in December by issuing 13,142,337 shares of SAKL’s restricted common stock were issued to each of the three founders of STC and TLF and CEO Richard Surber. The shares are restricted as well as subject to a Lock-Up Agreement. CEO Richard Surber said:
“Retaining the founders of our event companies, acquiring the remaining 33.3% of the Slide the City entities and The Lantern Fest as well as settling over $1M in debt prior to year-end is a strategic move designed to further strengthen SAKL’s financial position. The most recent transactions will improve available cash, conserve cash flows, improve efficiencies, improve the balance sheet and help ensure the retention of our event management team in a fashion designed to align their interests with SAKL’ long term operational and stock performance.”
SAKL is also expanding internationally. Slide the City Franchise LLC has signed a franchise agreement bringing Slide the City to mainland China with O2 Concepts (Hong Kong) Company Limited. The five-year agreement provides licenses to operate Slide the City in the following cities: Shenzhen, Shanghai, Beijing, Guangzhou, and Chengdou. In Malaysia, Slide the City had an estimated 8,000 participants attend a two-day event held on a freeway in Putrajaya, just outside of Kuala Lumpur last year. SAKL expects more events in Malaysia this year as well as possibly in Singapore, Thailand and Indonesia.
Currently trading at just a $5.7 million market cap, shares of SAKL are still quite undervalued considering the company is on track to do $18 million in revenues this year. With shares locked up by company insiders, there’s no threat of large blocks hitting the market. Overall, we expect shares of SAKL to continue trending higher and remaining a top performer on the OTC markets. We will be updating Insider Financial as soon as we know more. For continuing coverage on SAKL, sign up for our free newsletter today and get our next hot stock pick!
Disclosure: We have no position in SAKL and have not been compensated for this article.