- The Washington Times - Monday, December 11, 2000

The stock of Arguss Communications, Inc., the Rockville telecommunications services company, has been a Nasdaq listing. But this morning it shifts to the Big Board.The stock ended its run on the Nasdaq Friday selling at $11.94.

"Most companies in our industry are on the New York Stock Exchange. I think [the switch] will give us more visibility for our shareholders, and we feel it's going to be a positive move," said Haywood Miller, Arguss' spokesman and secretary.

The industry Arguss is in caters to cable companies and many other enterprises involved with electronic circuitry and telecommunications systems. The company's 2,100 employees provide engineering know-how, construction muscle and more.

"We put wire in holes and under ground … so we have trucks with buckets, and drenching machines and things like that," Mr. Miller explained.

Mr. Miller and Rainer Bosselmann founded the company in 1996 when they bought a small local public company called Conceptronic Inc.

"We were looking for a business, and we really liked this industry because it was providing services to a high-growth industry," Mr. Miller said.

Today Conceptronic is a $5 million Arguss division that provides computer-controlled equipment to the electronics circuit assembly industry. However, Mr. Miller says Arguss will put Conceptronic up for sale in the near future.

Three-fourths of Arguss' business comes from cable companies in 38 states, where its clients are constantly expanding. They are tending to upgrade their infrastructures to offer bundled phone, Internet, cable and DSL services.

Partially to take advantage of opportunities such expansion offers, Arguss has bought 14 smaller businesses over the past 3* years. Most of the acquired companies lay fiber-optic cable or build wireless systems.

"There are many, many years ahead of improving the telecommunications infrastructure because the [power] required by all these services is continuing to increase," Mr. Miller said.

This year Arguss has won construction business from Time Warner and Touch America and partnered with Protegrity Inc., an Internet security firm.

Analysts rate Arguss as well positioned in its industry with a growing backlog of $390 million of work for the months ahead and $280 million in market capitalization to work with.

Company sales for the July-September quarter rose 47 percent to $78.53 million from $53.35 million in the like quarter last year.

During the same period net income rose 62 percent to $4.61 million (31 cents per diluted share) from $2.85 million (22 cents). (Diluted shares reflect the value of options, warrants and other securities convertible into common stock.)

A report by researchers at Chicago's Deutsche Banc credits Arguss with $10 million in acquired revenue and 16 percent internal growth. And Mark Hughes, an analyst with SunTrust Equitable Securities in Nashville, Tenn., rates Arguss' management as "very good."

He noted the management philosophy "has been to buy good companies and to give management incentives to run their businesses. So the senior management structure is very thin, and [the managers] rely on the operating companies."

Both Deutsche Ban and SunTrust rate the stock a strong buy.

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