Muscle Pharm Corporation (MSLPQ)

[Madcowelixir]

I'm out.

I sold all my shares in multiple transactions at $1.52, $1.47 and $1.45 with my final sell transaction filling on September 5. I placed a feeler sell that refused to fill for over 2 days and was chased down in every instance I modified it to a lower ask. I will gladly provide proof with a screen shot of my transactions upon request.

Although I made +6% return in a couple weeks, the risks going forward are too great with the due diligence I have gathered recently.

The new manufacturer of the MP protein bars is terrible if customer reviews are only slightly to be believed. This will surely have an effect on revenue going forward as verified customer reviews on several sites show extreme customer dissatisfaction with many stating they will no longer order MP products going forward.

I reviewed and verified for myself the MP domestic sales trends for recent quarters by a contributor on another site and they are eye opening to say the least. I highlight the fact that these quarterly declines are before the MP protein bar manufacturing switch and impending effect on protein bar sales that will not be reported until Q3 numbers come out in November.

Also the first week of November, $18m of debt is due before the Q3 reporting date deadline. This will be in the quiet period so I don't know what to expect and too many questions and risk going forward if the MP sales decline again as I expect if the verified customer reviews are to be believed. Even if the CEO extends or rolls over the debt with a new pushed out due date, the 15% interest rate is a hurdle that is too much to bear for my future profit projections.

These are the previous 6 quarters of reported MP sales in North America

Q1 2016 $29.7m
Q2 2016 $23.5m
Q3 2016 $18.7m
Q4 2016 $14.8m
Q1 2017 $17.6m*
Q2 2017 $14.6m

*

Another significant issue is the lawsuit with the former supplier is being expedited by the home town court. This does not favor MP.



I didn't realize how great the protein bar sales were as a share of total product sales. Protein bar and Bakery Barn in particular made up 25% of MP manufacturing purchases in 2016. If recent verified customer reviews are to be believed, this leaves a lot room for reported revenue declines going forward especially in light of the seasonly light sales that occur in second half of the calendar year.