Kraig Biocraft Laboratories Inc (PINK:KBLB) Brace Themselves for a New Promotion
We once heard that the if the thread of a spider web is woven to the thickness of a pencil, it’s strong enough to stop a jumbo jet in its tracks. We can’t be sure as to how credible his “fact” is partly because we’re no scientists and partly because it was listed on one of those “fun facts” websites. The reason why we remembered seeing it, though, is the promotional email for Kraig Biocraft Laboratories Inc (PINK:KBLB) that we received from Profit Status.
Somebody seems to be quite desperate to get KBLB up since the third party paid a whopping $100 thousand for the pump. That sort of money is enough to get everyone excited and, sure enough, the email sounds exhilarating. The thing is, did Profit Status write all the things because they genuinely believe that KBLB will succeed, or did they just do it because of the remuneration?
We headed to KBLB‘s latest financial statement to find out. A wise man once said that everything is possible, but looking through the figures we doubt that KBLB will be making millions any time soon. You can have a look through the most important financials below:
- cash: $136 thousand
- current assets: $143 thousand
- current liabilities: $1 million
- no revenue since inception
- net loss since inception: $8 million
- net loss (Q3 of 2012): $292 thousand
Having in mind how difficult it is to produce what they call “the holy grail of synthetic fibers” and how many corporations with a lot more resources have tried and failed we just can’t see it happening any time soon. What’s also peculiar is that the word “laboratory” is featured both in the company’s name and in the slogan on their website. So why, we wonder, the equipment section of their report lists only automobiles and computers?
Promoters don’t regard this as being important, but the truth is, KBLB have been at it for too long and the results are nowhere to be found. This will certainly make shareholders impatient and potential investors reluctant.
Since we mentioned shareholders, we should also point out the fact that they have not had the time of their lives with KBLB. Over the years the company was forced to fund their operational needs through selling a lot of securities. They also weren’t able to pay off debt which means that hundreds of millions of shares have been issued over the years and during 2012 alone a further 15 million saw the light of day.
A quick check shows that back in November 2011, KBLB were promoted again, and looking through the emails, we can see that the promises were not much different. The fact that they still have not made a marketable product and not a single penny has been generated in revenue remains, though.
We all know how risky promoted penny stocks are. Pioneer Exploration Inc (OTC:PIEX) are a classic case in point and they were the target of many emails some of which were sent out by Profit Status in January. As you’d expect all the emails were full of the compulsory forward-looking statements. The chart shows, however, that they went down from around $0.25 per share to just $0.09 per share in a matter of a couple of weeks.
This goes to show how careful you should be while considering the risks when investing in small companies. When the company in question has been struggling to produce anything for a couple of years, it’s caution is even more advised.
