Management

Donald R. Podrebarac is president & CEO. He was founder of a nationally-known water company in Houston, & national sales & marketing manager for the water division of a Fortune 500 company. He developed several proprietary products including PurTestR. He is a licensed municipal water treatment plant operator, a certified bottled water plant operator, & a noted industry consultant.

Financial Status (12/31/98)*

Total Revenues $1.03 million
Net Income ($676,000)
Long Term Debt $158,638

* Detailed financial information is available at www.advisorinsight.com

Recommendation

I recommend VLPI for both midterm & long-term appreciation. This company is not only on the move, it is a classic turnaround, & I always like finding turnarounds. The IPO was at $3.25, & it fell to about $0.04 in 1996. The efforts of Don Podrebarac turned it around & as you can see, it's beginning to move up.

Its success with its line of water safety test kits is extremely encouraging. Sales have exceeded expectations & the company continues to improve its product line. I like the fact that PurTestR kits satisfy a vital need. As the public becomes more & more aware of the potential dangers in their water, sales of the kits will accelerate. Here are some other things I like:

o The fact that this is a turnaround situation
o Its contracts with large retail chains
o Its experienced & motivated management
o The fact that it has become a recognized industry leader
o Its expansion internationally

Contact

Call Sandy Coughlin @ 800-788-4825 or 704-821-3200, fax 704-821-3232, write 5001 Smith Farm Rd., Matthews, NC 28104, or e-mail at water@americanwaterservice.com.
www.americanwaterservice.com

Sneak Previews

I picked these special situations from those presented to me each month by my network of brokers, market makers, PR companies, investment bankers, venture capitalists, & key people in various industries. My primary criterion is my opinion of the stock's potential to double or better in the next six to 12 months.

Once a Sneak, a company becomes a candidate for a full recommen-da-tion. Our decision concerning which to recommend is based on what we find in continuing investigation. I may cover a Sneak I did a year ago, or one from the last issue; do not attach significance to timing.

While Sneaks are preliminary recommenda-tions, do not use them for investment decisions unless you decide on the basis of facts you uncover in your own investigation. Keep in mind that the codes listed after each Sneak are preliminary, reflecting my first impression. They are subject to change based on further investigation.

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