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Brooks -- I am glad to hear that somebody made money on a day that most of the major indices were down. Maybe you were short the market like I am, with TZA. Or maybe you had a winning pennystock. Good for you!
Warren -- Did you also inform the SEC about how the CEO of DRGZ poured $1 million or so of DRGZ's cash into Medico, as their largest shareholder, to prop them up at the expense of DRGZ? Seems to me like that's where your anger should be pointed. But being the lawyer that Melissa is, I'm sure she had her back covered.
Bell - It makes sense to liquidate now before/if Medico gains in value.
Warren - liquidation means the war is over for DRGZ, not just the battle. You don't need to be an insider to communicate the warnings that Bell did, you just have to realistically read their filings and understand that stock dilution impacts PPS.
One of the red flags to me was setting up Medico as a separate corporation. DRGZ stated they will get management fees from Medico, which of course, never materialized. Unfortunately, too much debt overwhelmed this company which reflects directly upon management. Melissa & Co. funneled hundreds of thousands of dollars in cash from DRGZ and set up Medico, which now as a separate corporation, has a shot of survival. As a lawyer, Melissa knew exactly what she was doing in case the debt could not be restructured. My 8/25/09 post says it all.
Rolle sold another 35,000 shares on Friday.
No, but we knew that.
BRIG 88 - Like many, you're confusing the separate corporation, Medico, with DRGZ.
I hope and expect Medico to be profitable. DRGZ's SEC filing stated they expect to get a management fee from Medico. As their largest shareholder, they can also earn income from any dividends that Medico declares. Other than these two revenue flows, the latter not guaranteed, I don't see how the separate corp Medico has a large positive impact on DRGZ. Medico's profits, if any, do not automatically pass through to DRGZ. DRGZ can go under and Medico continues on its' own. I posted this back in July, maybe more people are now coming to the same conclusion.
Any thoughts on why Rolle has been selling tens of thousands of shares lately?
My guess on Friday's uptick is that maybe some investors got results before the rest of us relating to positive performance on the contract with ONR that was due mid-Sept.
IACPA -We're partially saying the same thing. I did acknowledge the probable increased value of ones portfolio by stating..."You're hoping the potential value of Medico will drive DRGZ shares, which may happen." I was also pointing out the possible profits of Medico are not those of DRGZ, although they will be reported together on the consolidated income statement. I believe this is an important distinction when it comes to funding, etc. which is currently a critical issue. An investor may want to put their capital into Medico for example, not DRGZ, based on their projected potential of one corporation vs. the other. I'm not saying to solely look at DRGZ's products, but it should be a major consideration in anyone's DD, along with expected profitability of subsidiaries, which will add value.
Randy - I'm not questioning any facts you reiterated in your post as this has been public knowledge. Several posts ago I cautioned everyone about the only stated income from Medico to DRGZ will be that of a management fee that you are unsure of. Other benefits are speculative or hopeful at best.
A consolidated income statement is nothing more than an accounting option to state a summary of all holdings. For example, if Medico makes $5 million profit, DRGZ loses $1 million, the consolidated statement will show a profit of $4 million. This does not change the fact that DRGZ lost $1 million in this example. That's why you need to determine if the product offerings of DRGZ will generate the profit and shareholder value you seek. The product offerings and profits of Medico are not those of DRGZ. They set up a legal firewall between the 2 companies. DRGZ will see income from Medico in the form of management fees and declared dividends. Tell me how else a separate corporation can pass profits along to another corporation. You're hoping the potential value of Medico will drive DRGZ shares higher, which may happen. Just be aware of the FACT that Medico is a SEPARATE CORPORATION. And like I said, DRGZ can go uunder any day now and Medico continues on.
Dan - Are you certain Tharpe signed on with DRGZ? Or Medico? Big difference. If Medico, that's where he sees potential.
I continue to believe the two separate legal entities play a huge factor in each ones worth, DRGZ vs. Medico.
Net revenue down 64%.
Down to one product.
Debt over $6.7 million paying 12% interest. Interest alone equals the entire profit from this last quarter.
The only stated revenue per 10Q for DRGZ from Medico will be coming in the form of a management fee.
The new products better generate substantial sales/profit to allow DRGZ to survive. Nowhere in the 10Q does it infer that the separate corp. Medico will add anything except management fees to DRGZ' income. Those hoping for some pass through benefit will be sorely disappointed, IMHO.
And no, I'm not short, I thought a stock had to be above $5 to short it.
Latest 8-k:
"The Company entered into securities exchange agreements with the holders of its 15% convertible notes to convert an aggregate of $2,008,000 due on the notes into 2,008,000 shares of preferred stock with a stated value of $1.00 per share designated as Series C Preferred Stock together with the right to receive shares of common stock of Medico Express, Inc."
Wondering if existing DRGZ common stock shareholders will benefit from the future separate Medico stock performance?
The quote page on this board says the market cap of DRGZ is only $405,843 so I doubt she'll ever realize those millions.
PUNK'D is one of my favorite shows. What seems to be happening, isn't.
Everyone read the 7/8/09 SEC filing, part 6 on "INDEMNIFICATION OF DIRECTORS AND OFFICERS"? Draw your own conclusions, you know mine. DRGZ end game is near, no punk! Long live Medico, with a lot of luck, because Melissa will need it.
Carl - Here's where I respectfully disagree. As Medico is a separate corporation, why would you think the profits of that corporation get reported, or pass through to another one, DRGZ? Profits are distributed to shareholders in the form of dividends, and they must be declared by Medico.
I hope and expect Medico to be profitable. DRGP's SEC filing stated they expect to get a management fee from Medico. As their largest shareholder, they can also earn income from any dividends Medico declares. Other than these two revenue flows, the latter not guaranteed, I don't see how the separate corp Medico has a large positive impact on DRGP. Their profits, if any, do not automatically pass through to DRGP. Am I wrong?
Randy, you may be misleading others by calling Medico a division of DRGP. Legally, it is not. From DRGP's SEC filing:
"Medico Express, Inc., a Florida corporation of which the Company is the majority shareholder."
DRGP can go under and Medico can continue on since it is a separate corporation.
I agree for the most part. DRGP has too much debt to continue on. I'm not yet ready to declare the new separate company, Medico, a failure before they begin. Presumably, they have a clean balance sheet, unlike DRGP.
bell/Dude - Thanks for keeping the balance on this board, I've been raising concerns, with my previous 16 posts, since August '08. Some of us see things how they are, some put more emphasis on how they think things will be in the future. Both sides think they are right. I stand by my earlier prediction from April: DRGP can go under and Medico remains. The value of DRGP's shares in Medico would be an asset valued on the date of DRGP's bankruptcy filing and that value is very little at this time. Under this scenario, Medico continues on with no impact.
My update: above will happen before August.
I totally agree, Medico has the potential to be huge.
Where we disagree is the future of DRGP.
Talk to you again in Sept. or before.
Enjoy the summer.
No Val, I have no PROBLEM with the price going up. I'm providing my opinion based on data from their filings. It's an opinion just as yours is. I don't agree that it's scandalous that share prices are this low due to the fact that DRGP is an unprofitable company with $20M of debt, a portion of it due in July. These are facts. Maybe you can educate me and provide more insight on your positive outlook based on the current financial condition of the company, current products and outlook?
The debt and lack of profitability is keeping it at these levels.
Very good news for Medico Express.
DRGP getting through July and their payments would partially restore my confidence. July is key.
You actually confirmed what I'm saying. It says DRGP is a shareholder of Medico. Separate legal entities. Medico is NOT a wholly owned subsidiary like the others whose assets would be distributed in a bankruptcy.
DRGP can go under and Medico remains. The value of DRGP's shares in Medico would be an asset valued on the date of DRGP's bankruptcy filing and that value is very little at this time. Under this scenario, Medico continues on with no impact.
10-k says over $300k was paid back to related / unrelated parties so I'm guessing Rice got her loan/advance paid back. Her other stake in the company is her issuance to herself of preferred shares so she can control all decisions. Before that, she bought/had very little common shares.
I totally agree with your conclusion, that's why I got out 6 months ago. Don't expect any communication from Rice, she's too busy finding legal ways to prop up/funnel money to Medico at the expense of DRGP.
Regarding your Procede question, returns booked in Q4 had to be dramatically above declining Procede sales booked in Q4. Also, see last page of 10-k regarding legal proceedings.
Seems to me Rice already got her money out in the form of her high pay.
Per 10-k, they've funneled over $400k to Medico, a separate company, and say they'll earn management fees from them once they open. What a ROI, NOT!
DRGP is in debt for $20M. They're going to shift focus to Medico and guess what happens to DRGP?
SEC FILING TODAY - LATE 10K will be submitted.
PART III — NARRATIVE
State below in reasonable detail why the Form 10-K, 20-F, 11-K, 10-Q, 10-D, N-SAR or N-CSR or the transition report portion thereof could not be filed within the prescribed time period.
The compilation, dissemination and review of the information required to be presented in the Form 10-K for the relevant period has imposed time constraints that have rendered timely filing of the Form 10-K impracticable without undue hardship and expense to the registrant. The registrant undertakes the responsibility to file such report no later than fifteen days after its original prescribed due date.
ProfitScout - My comment about being cautious was about the current Qtr, not the July - Sept prior Quarter. October will most likely show the lessening of growth that most likely began in Sept. Many indicators showed a decline in consumer spending/shipments in Sept. Just look at volume @ UPS in Sept.
Regarding Emas, on August 18, 2008, he was appointed as a director at Bluefire Ethanol Fuels, Incorporated. I don't know if there's any correlation or not to his resignation at DRGP but the timing does coincide. Maybe he couldn't devote the required time at DRGP with his new director duties at BFRE. As far as stock dumpers go, I don't know if he was a major seller or not. I can say I have sold my 700,000 shares during the last month. I'm one less investor you have to speculate on. Best of luck, all. I hope Medico Express takes off before it's too late.
Regarding Rice, why wouldn't she stay in these troubling times? I read on FORBES she was pulling down a $225,000 salary. Seems a bit high to me when you're not making a profit. I know, some posters and relatives of posters on Wall Street say to focus on sales growth. Let's check back after the next Qtr earnings release to see if increased sales without profits led to DRGP's demise.
I just want to add a degree of caution in this difficult economy. Expecting growth in our current qtr to continue at the same pace is extremely bullish and (once again) counter-intuitive to the overall consumer discretionary spending trend. I have been able to offset my losses in DRGP by investing in ETF's that pay twice the inverse of certain indicies like the Dow30 and S&P500 by buying DXD and SDS. My sincere best of luck to everyone hanging in there with this stock.
I hope you're right. Time will tell.
Riddex and the Legends of Soul accounted for about 2/3 of last qtr revenue. Shareholders should demand what action management is taking to address consumer complaints about Riddex such as those posted on http://riddex.pissedconsumer.com/
Randy, your questions are nice to have answered but there are others that are more relevant to results:
What's the status of getting approval from Medicare to be a supplier for the hispanic diabetic market?
What's the status of expanding sales internationally?
How are sales going for the NASCAR club compared to plan?
Can we get another interim sales report?
Confidence for me would increase if I knew sales didn't tank in our current economic turmoil, and they got approval to establish Medico.
Anyone have any info on international sales? I was looking forward to revenue streams/profits increasing due to this leveraging ability.
Val - I am as passionate about this stock as you are and probably own more shares. What some posters are communicating are points very worthy of discussion. Increasing revenue is certainly a part of the picture but earnings are ultimately one of the most important deciding factors on stock price. Without eventual/sustained earnings, no company in the long run. I must admit my expectation of a higher stock price is based on previous cc's and news releases about exciting future revenue streams. It certainly isn't based on the most recent 10Q. And to reference Dutton's report from April is misleading at best.
I don't have the visual acuity of ProfitScout either who sees the whole picture developing because my picture of this company is still in the development process.
And what's up with Randy's recent restatement that management cares about shareholders.
A free flow of communication is what message boards are about. Melissa and co. may be reviewing these boards and some of the negative sobering messages may provide a wake up call to management. Maybe we'll have a cc next quarter.
- Frustrated as all shareholders are but pointed toward management, not other posters.
In line with full disclosure, we need to know the amount of back taxes owed. Below from May 10Q:
"Corporate, general and administration expenses. Corporate, general and administration expenses increased $1.4 million, to $2.5 million during the first quarter of 2008 from $1.06 million during the same period of 2007, primarily due to our planned investments to support the increased revenue base. Further in previous years the Company had failed to make appropriate tax payments and those additional costs are currently being offset against current earnings as the Company has entered into a negotiated amnesty program to catch up back sales taxes."
Also, we need to keep an eye on deferred advertising costs.
Have they announced the date/time of the next conference call yet?
For June 07, the footnote on the Form 4 said she "sold 1,000,000 shares of Issuer's stock for the purpose of making a loan to the Company for working capital."
And the addition of 1.5 million shares in April 08 "were received for board service for 2007 and 2008."