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Hello "fourkids". I've been gone a long time. So what's driving the rise in the price. Bring me up to speed if you can.
At least you'll know if they are or not in business, which is what you keep asking about. Common sense.
Pick up the phone, call them and talk to someone. It's called common sense.
Where and when did they exactly file? I have heard other wise.
Again, why would management and ownwers of the company go through all the expense and efforts of building a store, creating a website, establishing channels of distribution, etc.??
Is it just to dump shares and scam investors? What do they obtain from doing that. Where are the 8K filings stating that millions of shares have been sold by management? What's the purpose of going through all of this. Please explain in your opinion what management's specific end game or objective is? Or do you just make these insinuations to purposely attempt to keep the pps low?
I cannot believe the pps increase. The company only reported $80K of net sales and a $1.0MM NET LOSS as of their last 10Q filing as of 11/30/11 since inception????
Just a heads up to the doom sayers. CNBC recently released a report recognizing that reverse stock splits are usually good for investors in the Long run. I quote:
"New research indicates that reverse stock splits are usually good for investors.
According to a new report by Cleve Rueckert, Birinyi Associates senior equity strategist, there have been 14 stocks in the S&P 500 since 2000 that have undergone a reverse stock split. Of those fourteen stocks, twelve were higher one year after the effective date of the reverse split, two were lower. The average gain was a gigantic 62.55 percent."
Can't we just use some common sense. Why would a company go through all the trouble of building out a store in a highly recognized and pricey location in one of Europes leading fashion city's, continue to build other exclusive channels of distribution over the past year, engage a well know independent CPA firm, hire recognized individulas in the fashion industry to help build the brand name, etc., etc. just to tank the company and scam investors. I have spoken to the CFO on several occasions. His verbal explanations of the business model and management's strategy are spot on. He told me in January of 2011 that they were looking for a good location to open a flagship store and several internation cities were being considered. 9 months later, the store was open. He also told me they were going to initiate discussions with leading fashion designers with whom to collaborate and extend the product line. Recently, they released the pillow line with Rafit. He talked about enhancing the website - guess what - it was enhanced. There have been other insights he shared and I have no reason to doubt they will execute. They have so far. Why do some of the folks that post here continue to insist this is an elborate, well planned scam. Where is the proof. Please share or just use a little common sense. Again, there may be some shorters out there who are just attempting to keep the pps down. That's not the same as a company purposely trying to scam investors.
Or higher, depending on next piece of news, which I expect to be positive. All is going according to plan.
Last Q filing is now stale. Alot can happen to a company's operations in 90 days. Have to wait and see. If they obtain the financing they are seeking. Fugetaboutit, as we say in Brooklyn!
They are executing the model the CFO shared with me last January with precision: enhancing the website, building out the store, developing numerous diverse channels to distribute a variety of products, i.e pillows, bed linens, lamps, Heros and Demons line - all featuring the work of Horiyoshi. Of course this costs and will continue to cost money - but the proper alignment of financing is being sought. Hold tight, be patient.
Per previous discussions with the CFO, company continues to execute the business model as evidenced by recent collaboration of pillow line with Rizek.
May also be in discussion with Restoration Harware to release bed linen line through RSTO's 100+ stores. As I have said, 2012 will be very pivotal. Let's wait and see.
I have answered and disected how the money was spent numerous times in the past, and we keep asking the same question over and over again. PLease refer to prior posts where I have discussed line by line how the cash was spent. And yes agree with Imcat that the buildout and general costs associated with opening a store in one of London's most prestigous neighborhoods was an expensive endeavor. I saw the store myself and the pictures do not do it any justice. It is quite impressive and the clothing line is very well made and exquisite. Not your run of the mill Old Navy store in middle America, USA by any stretch. Picture Rodeo Drive in LA. The manager would not disclose the actual cost, but mentioned it was expensive. Friends in London have told me the store is doing well and has a lot of foot traffic.
As far as financing goes, my financial contacts in the LA area have heard that the company is in discussions with a major financial institution to obtain more tradtional retail financing to support its expected growth in 2012 due to the roll out of the Heros and Demon line. We shall see. Keep in mind, the company's goal is to first build a brand overseas, then bring that brand to the US. They seem to be following that strategy well. 2012 will be a pivotal year for them.
Friends in London report that the store is doing very well. Hero's and Demon's line on schedule to launch this spring. We shall see.
The SEC didn't even respond to Harry Markoplos when he handed Bernie Madoff to them on a silver platter. Took them six more years to acknowlede his scam, after complete details were sent to them. Don't hold your breadth on poor little HHWW. Agree with 4K, you either like this stock and buy at your comfort level or don't buy at all and move on. Simple.
Again, and forgive my naivete, who wins? The MM's, the shorts, management, etc. Easy question. Stock is zero, but a real company is still in existence. What happens next.
So 4K, just for my edification. What do these 2 "bidders" get out of doing this. What is their ultimate goal? Ruin the stock, make everyone else go away - I mean what is the end game for these clowns?
Thank you for response 4K. I agree with your applauds. Admirable attempts to build the brand in this difficult market sector. I'm all about analyzing the financial statements and ticking and tieing the debits and credits, which in this case do reconcile. I saw the same thing happen to Tommy Bahama when that brand came to market. Similar vicious stock manipulation, but the brand ultimately prevailed. Doesn't happen often, but when it does great opportunity to make good money if you get in at the right time. Since I deal with retailers in my line of work, I've seen quite a few start ups and this one caught my eye because the business model made sense and management is (at least up to now) executing (albeit with some misjudgments in the budget). Of course cash has to be spent up front to build the brand, create a demand, have the right distribution channels, suppliers, etc. It doesn't come cheap. Hopefully their bankers (HSBC) can work with them and provide the right type of financing to help grow the business. The've got my attention, and if they achieve the size I think they are capable of, I'll be knocking on their door for the banking relationship.
I'm curious to hear how the others who post here will answer my initial question; and I quote: "So what happens after the stock gets beaten to death?"
General question: So what'e the point of all this dumping of shares. Once the price is down to 0.001 - who won. The MM's, the dumpers, the short sellers - who made all the money. I mean, once the stock is beaten down, there's still a company that exists isn't there? Or is it all just an illusion. What if after all this share dumping and price beating is completed, the company actually starts to perform and deliver favorable, positive operating results? What then, what will the MM's do at that point. I'm curious to hear your opinions, since we have essentially eliminated the accounting aspect of this entity from the equation.
4Kids, please allow me to try to answer the "burn" question. First of all, the real burn from 12/31/10 to 9/30/11 is $3.8MM, not $5MM and of course the company cannot continue to remain solvent at that burn rate coupled with a lack of sales. You don't have to be a math wiz to figure that out.
I have, in the past, commented on where the $5MM has been spent. The cash flow statement as of 9/30/11 itemizes it clearly. Per cash flow: i) $915K was used to buy inventory; ii) $750K was for licensing rights; and iii)$1.5MM was used to repay a S/H loan. Those total $3.2MM. Add to that the $2MM in G&A expenses offset by the $1.7MM they still have in Cash on Hand. So the burn is more in the $4MM range give or take. This amount is typical for a new retailer entering the market trying to generate brand awareness (advertising, marketing, etc) and opening a new store no less. In my line of business, I see it all the time. I am a commercial business loan officer providing working capital lines of credit. HHWW's evolution is very typical. Can it continue at this rate forever - no, but their efforts to date are commendable and hopefully place them in a favorable position to begin to generate sales. The new Heroes and Demons line due out in Spring 2012 will be a nice boost and since that line is currently in production those expenses are being incurred in their G&A expenses. Something to keep in mind when you continue to talk about burn rates. Hope this helps.
Agree with 4 kids about short sellers. Not wasting my time anymore to address scam theories.
Isn't the full disclosure of the loan in the 10K sufficient to meet the SEC guideline. The 10K discusses the loan and to whom it is owed. Did they also have to file an 8K as well. Seems redundent.
This info comes directly from the 12/31/2010 10K:
Growth of our operations will be based on our ability to internally finance from cash flow, raise equity and/or debt to increase sales and production. Our primary sources of liquidity are: (i) cash from sales of our products; and (ii) financing activities. We received a total of $5,000,000 in financing activities which was comprised of the sale of two equity tranches in December 2010. Our cash balance as of December 31, 2010 is $5,576,131. In addition to the $5MM of equity, there was also a $2.2MM loan from a Shareholder, cleary discussed in the 10K filing. Cash on hand totaled $5.5MM with the offset being Additional Paid in Capital in the equity section of the Balance Sheet. From an accounting standpoint, all was classified as it should be. No hocus pocus here.
Fast forward to 9/30/2011 (9 months later). Cash on hand has been reduced from $5.5MM to $1.7MM representing a reduction of $3.8MM. The $3.8MM was primarily used for the following reasons (as disclosed in the Cash Flow Statement): a) $915K used to purchase inventory; b) $750K for the licensing rights; and c) $1.5MM to repay the demand loans to Stone Corp., etc. What's so mysterious about all this. The numbers tic and tie. Don't forget that in the interim they have also opened a new store and other distribution outlets. These things all cost a few bucks as well.
Keep in mind, the actual retail operation commenced in September 2010. The first trade of HHWW stock began on 11/1/2010. This SPECIFIC business is really only 14 months old. Why expect miracles. From my analytical perspective, net losses and cash drains are expected within the first 2 to 5 years of a new company. I see it all the time in my line of work. In fact, I see much worse than this more often than not. One of the most important metrics to measure during the early stages of a growing company is positive working capital (total current assets - total current liabilities) and the Quick ratio (COH + A/R divided by Current Liab.). HHWW has both and their Quick ratio is excellent (1.9x) when considering that 1.0x is Fair.
All in all, the numbers make sense and the business model is being executed. I would stop wasting time trying to uncover a scam. Patience will pay off. Your better off looking for the people who killed Kennedy.
It does not specifically say who. If your so interested call them.
Look at the cashflow statement in the 9/30/11 10-Q filing. There is a line item called Repayment of Loan from S/H for $1.533MM. Just look for yourself. That's what the financial statements are there for!
Also, forgot to ask, so the Stock Transfer Agent is also part of this elaborate scam. How many people are in on this. According to you all, it seems everyone connected to this company is part of the scam (i.e the lawyer, the CPA, the CEO, the CFO, the directors, the designers, John Wilkes Booth, Jr., etc.). OMG, who else?
The period reported through DOES not include the holiday season (October through December), which is key for any retailer. Also, recall that the new store only opened in August. So essentially, there is only one month's worth of sales generated by the store. Keep in mind they had to spend money to open the store, build inventory, pay vendors, payroll, Stone Corp., loan repayment, etc. Those are legit costs. I'm interested in knowing where you all think the money went. Just study the cash flow statement.
Of course. All those pictures were staged, just like the moon landings. Everything is just one big conspiracy. Go figure.
OMG. The company began the fashion operation less than 2 years ago. What more can one ask for. The business model is being executed (impressive website, solid, experienced management, reputable CPA firm, recognizable brand, NEW retail store, HSBC as its operational bank, etc. etc. etc.). From my perspective being in the financial services field, its only at matter of time before this business takes off.
I also got to visit the new store in London and I must say very impressive. Plently of foot traffic in an affluent area. Price points in line with surrounding competitors (i.e Jimmy Choo, Coach, Ann Taylor). Personally observed the sale of 8 items in the 45 minutes I browsed the store. Store manager and personnel very enthusiastic and knowledable of the product, which is exquisite to say the least. They are looking forward to the Olympics to begin and expect significant exposure. Timing could not have been better. Manager shared that the Heros and Demons line (aka street wear) is in production. That process and the release of new higher end merchandise is causing the spike in G&A (contrary to conspiracy theories being circultaed here). Company is also seeking alternative financing to support expected growth. Traditional working capital ines of credit is the preferred alternative, but is considering all potential avenues.
I live in New York and have personally purchased an item at the Saks Fifth Avenue store on 5th Avenue. The display exists and consumers are buying. All seems going as planned.
Totally agree with Imcat. Furthermore, to have your design line purchased by the likes of Saks and Neiman Marcus is no easy feat. The buyers at those firms are very meticulous and potential purchases are heavily scrutinized by senior fashion executives. Not an easy sell by any stretch of the imagination. I am leaving for London today and will report back next week with observations of the new store.
Spaderox and Imcat have hit it one the nose. THIS IS A HIGH END RETAILER for now. The Hero and Demon line will cater to the lower end of the market when it rolls out. The combination will be a good mix of inventory and keep a steady flow of sales. To those of you who doubt the affluent do not spend their money through any economy, take a look at Coach's operating metrics and stock performance. HHWW's strategy is working as planned. I will report back when I return from London and see the store for myself.
I'll see if this is all smoke and mirrors as some of you suggest.
Don't worry. I'm sure mm shorts will come to your rescue.
SHHHH! This store doesn't really exist. It's all part of the conspiracy. Produced by the same people who brought us all the "phoney" Apollo moon landings (LOL).
I'll let everyone know how my visit goes next week.
Yes. In November and December 2010, HHWW obtained $5MM equity financing from Zyndy Trade Corp based in Milan, Italy. It's in the 10K, 10Q, etc. Who are you referring too? This entity will be paid out.
Correction. Kranti Resources.
Zandy will be repaid and bought out. End of story.
Wow. Very interesting and informative post on the steps to take to pull off a penny stock scam. That means that the capital that has been invested to date in creating the exisitng line (which I have personall purchased bought), the high tech website, the HQ in California (which I have personally visited), the store in London (which I am visiting next week), etc. is all part of the "cash" being used to window dress the company, perpetrate the scam and lure uninformed investors.
That means that HSBC (their existing bank), their CPA firm (which is very reputable), Robert Forrest (a well know fashion designer), Paul Smith and the rest of the cast and crew are either part of this elaborate conspiracy, very stupid; or is it just Mr. Kojima and Horiyoshi himself that are pulling this off. Thanks for informing me. I am a banker and am in discussions with HHWW and HSBC to provide additional financing alternatives for the company, but thanks to you I will reconsider. Can't wait to let my Board of Directors know about this. Would you like to join me so you can lend your expertise on this matter?
How do we know or better yet where does it say that Zandy has the ability to sell the shares at that time. I have missed that comment in the 10K's. Please specifically direct us there.
Looking forward to visiting store in London soon. Looks like management is executing the model as they said they would. Good sign.
Spoke to company today. Some good news on the horizon!