Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
"The Playboy Club is part of the N9NE Group restaurant and nightclub company that operates mainly at the Palms."
The litigation is about whether Playboy has effectively terminated the trademark with Cirtran. If it actually has been terminated then technically there might not be royalties owing. Seems like there should be since Cirtran is selling product using the trademark - so they likely do owe royalties.
works for someone who gets paid with stock so there is incentive right now to keep the stock low.
possible to make money shorting the stock
The conclusion that there is improvement is questionable.
1. Quarterly Gross Profit to Net Sales at 94% versus 69% a year prior the likely result that the company is not accruing the Playboy royalty while in the legal courts.
2. Quarterly Loss from Operations down $180k from year prior, another result of not accruing the royalty expense to Playboy while in the courts.
3. Quarterly interest expenses reduced by 35%.
4. Quarterly Net Loss reduced by 41%, another result of not accruing the royalty expense to Playboy while in the courts.
5. Quarterly Selling and Administrative expenses reduced by 50%, since there are no distributors to pay since there are relatively no distributors.
6. Net Cash provided by Operating Activities up 200% (deferred revenue is a non-cash balance sheet item that means little. Cash is actually $180 as of March 31, 2014, down from prior year. $180 is all!
7. 98% reduction in debt converted to Equity (no outstanding shares available to convert)
8. 15% reduction in cash paid for interest during the period ($3,851 less, not a big deal)
9. Net loss reduced by 40%. another result of not accruing the royalty expense to Playboy while in the courts.
10. 300% reduction in accrued liabilities. ???? Current liabilities increased since December to $23.5 million.
11. 85% reduction in deferred revenue. Often means that sales are not increasing, which is a bad thing.
Debt is not under control $23.5 million in current liabilities as compared to $279k in current assets. Same POS.
Mr. Iehab accrued a salary of $465k in 2013 and 2012 per the Company's 10K. However, the 10K states that:
"Mr. Hawatmeh did not receive cash payments for his salary or bonus during the 2012 and 2013 fiscal years. His salary and bonus expense have been accrued. Of the amounts reported for 2012 and 2013, $345,000 was accrued by us and $120,000 was accrued by our variable interest subsidiary, Play Beverages, LLC, respectively."
"Under our Forbearance Agreement with our principal secured lender, YA Global Investments, L.P., all cash amounts payable to Mr. Hawatmeh in excess of an aggregate of $120,000 per year is accrued and will not be paid until the obligation due YA Global is paid."
At some point Mr. Iehab will get his money - he will make sure he pays himself.
Mr. Iehab's annual salary is $465k (see 2013 10K).
However, Under the Forbearance Agreement with YA Global Investments, L.P., all cash amounts payable to Mr. Iehab in excess of an aggregate of $120,000 per year is accrued and will not be paid until the obligation due YA Global is paid.
Once YA Global gets paid you can be certain he will be paid everything owed him before anyone else gets paid.
CIRC's worst enemy is it's own management. That is who Circ should defeat (replace). He is an incompetent CEO - just look at the history of the company - years of losses and squandered opportunities.
Mr. Iehab has had funds before and squandered every bit of it.
history of losses, inept management, and continual lawsuits are what are keeping the stock price down. No domestic distribution networks is a major problem. Not knowing if the trademark agreement will continue is a huge concern.
Don't think so.
If Circ is recording revenue that is generated from the Playboy trademark, then accounting rules require Circ to record (accrue) any associated costs, including the trademark royalties) for generating that revenue. The trademark royalties are part of that cost so they need to be recorded. You can't record the revenue without the costs. My accounting sources are very reliable.
That is totally different from legal fees, putting on hold payments, etc.
No matter what the outcome of the trademark dispute CIRC will likely have to pay all back royalties.
My guess is that the trademark agreement will be discontinued, similar to the Starbucks Kraft situation.
No, you are confused. Check with your accountant. I checked with mine.
Cirtran needs to accrue a royalty expense (for use of the trademark) with an offsetting liability showing that they owe Playboy for use of the trademark. Then, at some point in time, Cirtran pays the amounts owed to Playboy.
Paying royalties and recording the expense / liability are related, but not the same thing. If I read basic accounting rules right, the expenses need to be accrued / incurred if the agreement is in place and revenue is recorded. That is entirely different from the payments for the royalties. A business records the expense / liability first. Then the liability is paid. Separate matters.
The question still stands - where are the royalties being recorded? Maybe the Company is not recording the expense because they do not have the make the payments right now. If so, that will be a big problem.
Poor operational performance and the legal uncertainties are what is keeping the price of this stock down
As a moderator conveniently deleting one's own post to hide what one said is shameful.
The last I checked we are still waiting on Judge Pantle.
Convenient that moderators can delete posts.
From the Ihub Help:
Deletion of Posts
While in manage mode, Moderators will see a message that says "Click any message below to view, then remove or restore it." Clicking on a specific post will then show the option to "remove" in a box on the left. Clicking this will then provide the following options as a reason for removal: Personal Attack, Duplicate Post, Spam, Off Topic, Vulgarity, Author Asked to Remove, Violation of Privacy, Threat
No worries, post#26747 (dated 01/03/14) indicated that "Soon we will the know the Judge's {opinion)" was the response to Nascow's post#26746.
Soon? Really?
Interesting that the post that I quoted from earlier is all of a sudden deleted. Coincidence? Convenient. I have asked Admin to look into it.
It was your comment. Check your comments back on that date.
"...May we all be warning our sleds under the Hawaii sun soon" 01/16/14
You do not know that and it makes no sense. Of course Playboy cared about sales. Higher sales equals higher royalty payments. Distribution networks mean nothing if they do not generate sales. Cirtran has no substantial domestic distribution and the international arrangements have not generated substantial repeat business ever - just look at the numbers.
You will not be taking any of Mr. Iehab's money. The money you will get will be from naive investors trying to cash in on a legal settlement not understanding that Mr. Iehab will again p!ss away all funds and they will be left with nothing. Happens every time. None of his money will come to you.
It's about distribution channels and marketing. Red Bull tastes like sh!t but it is the leading Energy Drink Worldwide.
heard from who?
Correct - you have to look beyond the numbers - most of the recent gains (and improvement in losses) are non-operational (settlement of debt) which masks that the company is still losing money from operations.
Plus, where are the royalty expenses - that used to be $2,000,000 a year - being recorded now? Surely the royalty expense should still be there if the trademark agreement is still in force. I do not see where the costs are being recorded.
Pay suppliers with stock, produce drink, sell drink, use cash to pay suppliers to produce more drink, sell drink, use cash to pay suppliers to produce more drink, sell drink, use cash etc. Seems like CIRC should be able to sell and litigate at the same time.
This is what is damaging the stock price - years of losses and cash used:
Losses Cash Used
2007 $(4,801,900) $(4,260,618)
2008 (4,205,916) (4,594,742)
2009 (4,342,761) (485,406)
2010 (2,972,488) (688,240)
2011 (7,043,410) (320,115)
2012 (1,787,643) (165,897)
Dupa, seems like you have changed your perspective in the last month - now it is just a legal play.
"The energy drink sector is a $47 Billion dollar sector. CIRC doesn't have to compete with Redbull and Monster to grab a significant share of that market. Just ONE % of that sector is $470 Million dollars so even if CIRC eventually loses the license, just re-invent the drink by re-labeling it and giving it another name. I'd be happy if CIRC only got 1/2 of that 1% of the market. That would be sales of $235 million. ANYTHING CAN HAPPEN and I believe CIRC has a fighters chance of it happening. Monster and Redbull (private co. I believe) started somewhere much lower than where their market caps are now. "
Sparky, are you banking on your buddy Iehab's management skills (none) or simply the legal play?
Mr. Iehab should be responsible and file when public companies are supposed to, not whenever he wants to. Another example of lack of fiduciary responsibility to shareholders.
Facebook ads are not going to get distribution channels. LOL
Not likely - not enough foolish investors to drive the price up that high given the history of this stock.
I said it was nonsense that CIRC can compete with the big boys - not likely that it will reach $.05. Read the post thread again
Where have you been? Just check my previous posts for a while now. My point has always been that the sh!t about this company competing with the big boys is nonsense. This has always only been a legal play - but your assumptions of $.05, tons of cash, is way too optimistic. Not likely.
Not a chance.
No chance CIRC can compete with the big boys - no distribution channel. CIRC will blow through all settlement funds trying. Mr. Iehab and his secretary do not have the ability to compete.
What would the corporate attorney say about the status of the trademark?
Even with some level of settlement money Circ cannot compete with the big boys. All funds will be squandered by Mr. Iehab. Just look at the history of this pos.
The book "The Trinity" by Rahner is more appropriate and a better read.
the longer it takes the less likely CIRC keeps the trademark.
Owning the ingredients means nothing if you cannot produce it profitably and there is no distribution - so you cannot sell it. Practically worthless - just like the stock price.