Cimetrix cheap? Looking for shareholders

This is an unusual post and serves primarily as a request for information from other Cimetrix shareholders.

Cimetrix (OTCMKTS:CMXX) looks like a “dark” stock that could be quite cheap. Cimetrix develops software for precision equipment manufacturers serving the semiconductor, photovoltaic, LED, and related industries. The company is a relatively young dark company, having deregistered its stock with the SEC in 2015. That means you’ll not find it in an old publication like Walkers Manual of Unlisted Stocks.

The company did 1 for 10,000 reverse stock split in December 2014 to reduce the number of shareholders of record to below 300, allowing the company to go dark. In 2016 the company did a 1,000 for 1 forward stock split. Adjusted for the splits, shareholders received $1.50 per share in the going private transaction.

As of August 1, 2017, Cimetrix has 3,919,350 shares outstanding and 4,890,500 fully diluted. At the current ask price of $1.75, Cimetrix’ market cap is $6.9m. Taking the fully diluted share count it’s $8.6m

Insider ownership seems quite low, because the company mentions the following in the latest proxy statement:

No one Company director, executive or employee has a 5% or more ownership position in the Company and no one Company director, executive or employee has a 9% or more fully diluted ownership position in the Company.

The company provides some information to shareholders on its blog. In the latest mid-year update Cimtrex reported revenues of $4m for the first six months of 2017, up more than 40% year-over-year. Adjusted EBITDA was $600K+ for the period. The company had $2.5m in cash and no debt.

Cimetrix also seems to buy stock from shareholders who contact the company:

As a result of generating positive cash flow from operations, Cimetrix was able to continue providing liquidity for shareholders that contacted the Company. Prior to going private, the Company had over 4.5M shares outstanding, adjusted for stock splits. As of December 31, 2016, the Company had fewer than 3.9M shares outstanding. This means that every current shareholder’s ownership percentage has increased by over 15%.

It looks like Cimetrex has quite a bit of excess cash on the balance sheet and that business is good, thanks to demand from the currently strong semiconductor industry and markets for capital equipment.

Unfortunately, that’s as far as I’ve been able to get. I do not have any recent financial statements or annual reports of the company. I’ve e-mailed the company several times requesting the financials or the latest annual report, but they have not replied. The company’s profile on OTCMarkets.com mentions that “Cimetrix is a privately-owned company as of 26 December 2014”, this choice of words is also a bad sign.

That’s why I’m now publishing this post. If you are a Cimetrix shareholder and have more information about the recent financial performance of the company, I would like to get in touch with you to discuss the company. You can contact me here.

I have a very small position in the stock.

Disclosure: long Cimetrix (OTCMKTS:CMXX)

Posted in Pink Sheet stocks and tagged .

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