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The Future is Fat
Do you hate cable TV? I despise it. I held out for years, despite my ex-wife and daughter's insistence that there was nothing good on regular TV. "All cable is is more bad TV that you have to pay for. It even has commercials!"
In fact, entire cable channels seem to be nothing more than the video equivalent of junk mail. Take QVC. Please. It's nothing but a shill for manufacturers of garbage... like Beanie Babies and Elvis figurines, right?
Well, I've been informed more than once by my daughter that I am a dinosaur and I should get with it. Maybe I shouldn't dismiss QVC so readily.
After all, 70 million bored housewives with open pocketbooks can't all be wrong. I suppose it was only a matter of time before some bright boy in marketing figured out how to cash in by pitching quality products to the ravenous hordes.
A spoonful of sugar
Now those whiz kids have arrived. AMBI Inc. (NASDAQ: AMBI) has discovered a better way to get Americans to take their medicine.
First they came up with Cardia Salt, a salt substitute that won't raise your blood pressure (mmmmm, salty popcorn). Then they came up with Lite Bites, a fat-fighting snack bar with "added functionality," a fancy way to say that they've crammed in stuff that's good for you (that they own the rights to. More on that in a moment).
Now they've putting the whole kit and caboodle on cable. On June 25, AMBI's Lite Bites will be the "Today's Special Value" on QVC. This sort of enlightened marketing of quality health-enhancing products is certainly making AMBI's bottom line healthier. In fact, AMBI's stock has doubled in the last month, climbing from US$1 3/16 to just shy of US$3 before settling into a groove at US$2 5/8.
 "I'll take AMBI for US$3, Alex"
This growth is no fluke. Despite doubling in May, AMBI remains dramatically undervalued below US$3. Its sales for 1Q '99 were up 38.44% over 1Q '98 and income for same is up 31.27%. Better yet, twelve-month trailing (TTM) sales are up 74% year over year.
And unlike their brethren on the Net, they are not sacrificing profits to buy sales. For the last six months of '98, gross margin was a healthy 84.14% on sales of US$12.8 million.
And we're not the only interested party. Registered insider trading for the last quarter was all buys and in May, the specialty brokerage Adams Harkness initiated coverage of AMBI with a recommendation to accumulate. We're talking serious momentum gathering here. Let me tell you a quick story that illustrates where that big mo is coming from.
Uncle Harry busts a gut
After my Uncle Harry was diagnosed with high blood pressure, he told me he could handle everything about it except the food thing. "Everything your aunt cooks tastes like cardboard now," he would gripe.
 Some guys stash a little whiskey out in the shed. Some like to sneak a cigarette out back, after they've told the wife they quit. Uncle Harry would sneak salt into everything he ate until he finally blew a gasket.
If my aunt had known about AMBI's Cardia Salt, Uncle Harry might still be around, squeezing cheeks and losing money on the ponies. And if Harry would have used it by the ounce, the aging baby boomers are gonna snort this stuff by the ton.
You can have your salt and eat it too
Cardia Salt is a salt substitute for folks like Harry. It won't aggravate high blood pressure or interfere with medications. And yet, it passes the taste test with flying colors and lacks the awful bitter flavor associated with previous substitutes. It can be used with equal ease in the kitchen and at the table. It even comes in a salt shaker.
Now they just have to let the salt-addicted aging masses know it exists. To do that they've formed an alliance with an 800 lb. marketing gorilla: the Whitehall-Robins Healthcare Division of American Home Products (you know these guys, they sell Advil and Centrum).
Whitehall-Robins has been licensed to market Cardia Salt as a tabletop product to the big grocery store chains, and a product launch is scheduled for late summer or early fall. But Cardia Salt is only the beginning.
AMBI has 15 additional patents locked up and products in development to market them with. And Whitehall-Robins has already picked up the first-negotiation option for future AMBI products, including their latest health-munchy, Lite Bites.
Stealth health
I swear these guys are in league with my mother. In fact, their newest product line, Lite Bites, could easily be the result of a secret plot by mothers everywhere to get us to eat right despite our marked penchant for pastries, cakes, danishes etc.
Lite Bites appear to be yet another entry into the low-fat food bar market. But, where most products like this are content to simply replace their fat and sugar with passive (and foul tasting) substitutes, Lite Bites are packed with 22 vitamins and minerals, and a proprietary active ingredient that is clinically proven to build lean muscle tissue instead of fat.
That ingredient is Chromax (a.k.a.: chromium picolinate), and AMBI owns the patents on its dietary and medical uses. More than 25 studies have established chromium as an essential mineral for the processing of sugar.
Boosting insulin--and profits
As the most bioavailable form of chromium, AMBI's Chromax will be an incredible boon to diabetics as an insulin booster. But it's the dietary applications that have folks drooling.
Eat all you want, lose weight, add muscle mass, tons of vitamins: this is the supplement industry's Holy Grail. And it's street legal. The trick is to get it to market profitably.
AMBI CEO Frederic Price has got a plan from hell. Remember those 70 million housewives receiving QVC? That's just the beginning.
To hell with stealth
AMBI's not waiting for customers to come to it. It has announced plans to get into the direct mail game with its Heart's Content catalog, and it's preparing to establish an aggressive Internet presence with a new website in the works to flog all this healthy stuff to the Gen X surfers.
To ensure the success of this marketing drive, in May, AMBI elected Sander Flaum, CEO of Robert A. Becker Inc. Euro RCSG, a hot healthcare marketing and advertising agency, to its board. His expertise in both marketing and acquisitions will be crucial to AMBI's hunt for new products and increased exposure.
So far, AMBI has been made good on all its promises. It's formed corporate partnerships and acquired new products. Its financing is clean and it has cleaned up its outstanding convertible shares. And it has consistent growth in revenues and earnings.
When I spoke with AMBI president and CEO Fredrick Price, he empasized how AMBI has quietly surpassed all its competitors.
Face it, folks. We baby boomers are not getting younger or skinnier. Nor are we going to take aging lying down. We want our magic bullets. And that's what AMBI delivers: magic bullets that seem to work.
AMBI has already doubled in 1999. Currently trading below US$3, it has the potential to do so again--twice. I see AMBI going to US$4 once the website launches and US$10 by the end of the year.
The past is prologue
The next century may be completely unlike anything we have ever experienced. But there are certain facts that will be just as true in a hundred years as they were a hundred years ago. The sun will still rise in the east, apples will still fall down and stocks will still only really be worth what their underlying companies can do for their customers.
So what do airplane tires, plastic wood, battle-hardened computers and candybars for fat boys have in common? Let me put it all together with a bow on top for you.
They are all good ideas yoked to a common-sense work ethic. All these companies provide tangible products and services to reliable, growing customer pools. Not smoke and mirrors. Not dot.com gonna make money someday, somehow fantasies.
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