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At the current price of $.01, we feel that Marmion Industries Corp. (OTCBB: MMIO) is exhibiting tremendous upside potential. Trading in the stock has cooled off a bit in recent weeks with no news flowing out of the company.

However, after a recent conversation with MMIO’s CEO and a peek at the company’s recent quarterly filing, we are optimistic regarding what the future holds for Marmion Industries (trailing 5-month revenue comparison chart to right)

In addition to Marmion’s consistently improving financials and recent expansion into Louisiana , the company’s premier customer continues to experience record growth. MMIO has also recently initiated its first ever concerted sales/marketing program by taking out an ad in Offshore Magazine, which was in turn distributed for free at the “Worlds Largest Offshore Oil Technology Conference” last month where executives were in attendance.

The company’s biggest customer, Powell Industries (NASDAQ:
POWL), saw second quarter profits double and in turn raised its full year 2008 profit and sales outlook. POWL accounted for 30% of Marmion’s 2007 revenue and will likely send even more business the company’s way once its new manufacturing facility goes online in August.

Powell is currently segmented into two groups: Electrical Power Products and Process Control Systems. The former, which according to the company’s annual report logged $546.1M in 2007, the lion’s share of corporate revenues, serves a deep base of customers in Marmion’s core target market making the two entities a perfect match.

Target Market: “operators of oil and gas pipelines, refineries, petrochemical plants, and electrical power generators; public and private utilities; operators of co-generation facilities; mining/metals companies, pulp and paper plants operators, transportation systems operators, and governmental agencies and other industrial customers” Yahoo Finance, Business Summary

Although expanding and diversifying the customer base is a key strategic goal of the company, since Powell does bring in more than $500M a year in sales, MMIO can clearly benefit from a deeper relationship with its top customer going forward.

According to Offshore Magazine: “The 2008 Offshore Technology Conference attendance was 75,092, report organizers. This tally is up 11% from last year”.

For a company that has relied on word of mouth thus far to drive growth, the conference is a major step in the right direction. The implications for Marmion (3yr. rev chart to left) are huge here if just one long-standing relationship is forged. Particularly since MMIO did rely on only 3 customers to generate 64% of revenues in fiscal ‘07.

According to the company’s recent annual filing: “Our long-term plans for growth include continued expansion of our industrial base into Louisiana. We have obtained the necessary licenses in Louisiana and during the first quarter of 2008 we received our first orders from customers in Louisiana.”

Louisiana is the leading crude oil producer and the second largest producer of natural gas in the U.S. The state’s oil & gas industry generated a reported $70.2 billion in 2006 sales and lays claim to nearly 90% of the nation’s offshore rigs. In regards to petrochemical activity, the state has nearly 90 chemical plants and is home to roughly 70 petrochemical manufacturers.

So clearly, the region represents a prime opportunity for Marmion in addition to its home region of Houston, the “energy capital of the world”. Already holding both Mechanical and Sheet Metal Contractor Licenses in the state of Louisiana (Lic. No. 44001), the company appears ready to prospect growth in a new and potentially extremely lucrative market

Despite a lack of communication from the company in recent weeks, Marmion’s first quarter financial report provides us with reason to believe things are plugging along nicely at MMIO:

Here are some of the highlights from MMIO’s recent Q as we see it:

• Q1 Revenue increased by more than 80% from Q4 ‘07;
• Income from operations was $140,514 compared to a loss of (45,144) during Q1 ‘07;
• Net loss of (75,895) compared to a net losses of ($517,861) and ($427,000) for the first and fourth quarters of 2007 respectively;
• Revenues increased approximately 15.6% for the three months ended March 31, 2008March 31, 2007; from the three months ended
• Approximately 33% of revenues were attributable to equipment for the petrochemical industry and approximately 67% were attributable to the commercial division;
• Gross profit margin improvement of 8.7% to 24.5%;
• Total Cost and Expenses increased approximately 6%;
• G&A expenses decreased approximately 3.5% in the three months ended March 31, 2008March 31, 2007; from the three months ended
• D&A expenses increased approximately 37%; and
• Net cash used in operating expenses for the three months ended March 31, 2008 was $443,174 as compared to $147,286 for the three months ended March 31, 2007.

Here’s a quick look at MMIO’s Financial Highlights from 2004 – 2007:

• Produced revenues with a CAGR of 53.27%
• Boosted EPS by $0.45 to -$0.03
• Improved Profit Margin by 231% from -284% to -53%
• Maintained an average Gross Margin of 19.25%
• Successfully sustained an average GMROI of 331%
• Here are a few of Our 2008 – 2012 Projections:
• Revenue Streams With a CAGR of 29.6%;
• Positive Net Income of Nearly $90,000 in 2010;
• Profit Margin of 8% by 2012; and
• EPS of $0.0241 by 2012.

As business trends improve for Marmion and the company nears completion of a much larger manufacturing facility, 2008 is shaping up to be another record year.

Momentum in the stock appears to have been halted by a lack of corporate announcements. . . But, on the flip side, selling pressure has subsided lately, so any positive news over the next few weeks could get shares back on the right track. We suggest watching this one closely. We’ve all seen MMIO share price double, triple and more than quadruple in the past.

Despite a lack of communication in recent weeks, Marmion’s first quarter financial report provides us with a glimpse into the company’s recent performance.

Here are some of the highlights from MMIO’s recent Quarterly filing:

• Q1 Revenue increased by more than 80% and 15.6% over Q4 and Q1 ‘07 respectively
• Income from operations was $140,514 compared to a loss of (45,144) during Q1 ‘07;
• Net loss of (75,895) compared to net losses of ($517,861) and ($427,000) for the first and fourth quarters of 2007 respectively;
• Approximately 33% of Q1 ‘08 revenues were attributable to equipment for the petrochemical industry and approximately 67% were attributable to the commercial division;
• Gross profit margin improvement of 8.7% to 24.5% over Q1 ‘07;
• Total Cost and Expenses increased approximately 6% over Q1 ‘07;
• G&A expenses decreased approximately 3.5% in the three months ended March 31, 2008 from the same year period in ‘07
• D&A expenses increased approximately 37% over Q1 ‘07; and
• Net cash used in operating expenses for the three months ended March 31, 2008 was $443,174 as compared to $147,286 for the three months ended March 31, 2007.

According to their recent 2007 annual filing, Marmion Industries Corp. (OTCBB: MMIO), has recently expanded into the Louisiana petrochemical marketplace. Already benefiting greatly from a thriving niche position in Houston, the “energy capital of the world”, MMIO has grown annual revenues steadily since 2002 while significantly improving its bottom line.

With a new facility now being built that will simply let the company build more product than ever before, Marmion should be able to meet new demand for its offering brought on by the company taking on another major sales territory.

From the filing:“Our long-term plans for growth include continued expansion of our industrial base into Louisiana. We have obtained the necessary licenses in Louisiana and during the first quarter of 2008 we received our first orders from customers in Louisiana.”

Marmion Enters Another MAJOR market:

Including offshore production, Louisiana is the number one producer of crude oil and the number two producer of natural gas among the 50 states. The oil & gas industry is a giant economic engine for Louisiana’s economy, supporting $70.2 billion in sales for Louisiana firms (Louisiana Mid-Continent Study, 2007).

Oil & Gas Quick Facts:

• Louisiana has the second largest refining capacity among the states (16.7% of the total U.S. capacity)
• 88% of U.S. offshore rigs are located in Louisiana’s Outer Continental Shelf (LDNR, 2007)
• Louisiana has 19 operating crude oil refineries
• Louisiana’s 41,320 miles of distribution pipelines move natural gas, crude oil and refined products both in and out of state
• More than 5,700 oil and gas platforms in the Gulf of Mexico – 2,300 are active (Minerals Management Service, 2006)

According to this article: “SICK BUILDING SYNDROME has been recognised by the World Health Organisation and symptoms include eye, nose and throat irritation, headaches and dizziness.The Health And Safety Executive say causes probably include poor ventilation, high temperatures and poor lighting“.

Now gaining increased traction within the commercial sector of the HVAC industry, Marmion Industries Corp. (OTCBB: MMIO) could benefit greatly from exploring opportunities related to replacing the thousand of outdated systems plaguing office buildings throughout the country. I’ve read that an outdated HVAC system can waste as much as 40% of the energy it generates, so MMIO has a great deal to gain if they can leverage their recent success in educational facilities into the establishment of contracts in a wider variety of installation environments including office buildings, retail, etc.

This week could prove to be a pivotal one for the folks at Marmion Industries Corporation (OTCBB: MMIO).

Corporate executives are reportedly attending world’s largest offshore oil technology conference in conjunction with their first ever major advertising campaign. Marmion is currently running an ad for its new Stallion product line in Offshore Magazine, which is being given away to each of the estimated +70,000 attendees.

The gathering should present an ideal networking opportunity for the company and a chance to garner increased brand recognition in the petrochemical industry. With a new, larger manufacturing facility being built, MMIO appears eager to pursue new business and prepare to take advantage of its expanded capabilities.

Shares are up 12.5% to $.0135 as of 11:49 EST today on volume of 1.4M.

It will be very interesting to see if we test $.015 in the coming hours. Another surge of high volume like we saw earlier this morning could push the stock higher, but trading in the stock has slowed a bit.

Interest in MMIO is surely growing throughout the micro-cap market as positive news continues to flow.

Given the current activity of the stock, those still potentially holding shares from March’s 52-week lows will be closely evaluating their investments in the very near future, if they have not already, and deciding what to do with their positions.

Will they take a healthy profit in the sub .015 range, or hang on for a push higher? I’ll be watching closely over the next few hours.