Good evening all;
I have spent a bit of time this weekend digesting everything and viewing quite a few (but not all) of the posts out here. I am going to make several points (good and bad) and hope everyone realizes that this is just IMO, so I say that up front. I will tell you that I own about 660K shares avg'd in about 1.5 cents a share and plan on holding for at least a while before I decide what to do. Anyway, here goes:
1. Twenty some odd centers marked on thier map. As someone previously posted this weekend, these are most likely distribution wholesale houses they have agreements with. I sell mobile stereo/alarm/video at my store and the local supplier is also a performance after-market parts house. They make agreements with manufacturers to carry thier product and maintain a certain level of inventory. No one ever stated/proved that these red dots were suppose to be "owned" distribution centers. We see from the 8K that they have the warehouse in CA for receiving shipments of product from the China manufacturer and then shipping from there, which is probably to the other red dots on the map. That is no big deal, just the way business is done.
2. 8k sales. I was not impressed and thought is was lower than I would've liked. That being said, many out here try to compare it to the blue sky estimates many made out here (3mil, 5mil, 7mil etc) and that was their mistake. You should always wait for the proof. Others after the 8k have tried to say sales have declined yr over yr and that cannot be proved w/07 numbers as they only represent 6 months of data, not 12. We can all take the 6mo #'s and try to assume 12mo, but I again will be interested in seeing the next qtrs results w/intro of new cat/back systems as well as the 4th qtr #s. The triple digit growth qtr over qtr between 05 and 06 cannot be proved/disproved as they did not give us any qtr over qtr numbers. Even though I don't like the sales numbers, I like the gross profit margin they are showing. If you don't have a good profit margin to start with, then the bottom line can truly only get worse, but that is not the case here.
3. 8k cost of advertising/sponsorships. Many companies have paid substantial amounts for advertising and relationships to boost thier sales. It takes time most times and it also takes revisiting the cost. My side business (mentioned above) has never been in the black. For quite a long time, I advertised w/big ads in main phone book, radio ads etc. By the time I realized how much I was spending on it, I figured out I was cutting my own throat. I cut out most of my advertising and now streamline it and make deals for shorter periods of time. If it doesn't result in business sales, I stop it short. Many companies go through this. So while they've spent a boatload of money for these relationships, they at least did it with the right people for their product. It may take time to realize the fruits and it may have to be revisited for cost evaluation.
4. 8k liabilities. I have seen many numbers close to what I've come up with, but nothing matching it, so I'd like to put out what I see and find out where we differ:
Notes Payable: Total listed on 8k was 6,878,401 but adding up amts in notes comes to 6,908,527 so I used this number. Then notes show settled for shares:
891,128 former director
1,870,000 FCCN loan
2,613,411 Morgan MM
244,925 Company Director
345,000 Unrelated parties
5,964,464 settled leaving
944,063 remaining
Interest was 806,310 with:
448,319 former director
170,475 Company Director
66,667 Unrelated parties
685,461 settled leaving
120,849 remaining
Using those numbers leaves total liabilites at about 2,150,880 which then lowers the retained deficit and stockholders deficit by 6,649,925 which would make the stockholders deficit about 1,532,916
This, while not putting company in black, is a much better picture. Many looked at just the financial stmts and did not read the notes for all the settlements made subsequent to June 30th, 2007. Others noted the settlements were done on our back, which to some extent is true. But it is also included in the current outstanding shares of which we currently own 35%.
5. China manufacturing company. If the supply of stainless steel is good in China, then it makes sense to have manufacturing of a stainless steel product done there.
6. I agree w/other posters about independent testing. It's nice to have racing teams say they tested the product and it does what it claims. But if they have an independent lab/shop test it and release it's findings, that would go a long ways to help market the product to others outside the racing community. Especially when spokesperson (Rusty) is so favored in the racing community and affilliated with Aero. Many would suspect that relationship could have affected those findings/announcements.
7. PR's coming and Letter of Intent to acquire another company. Who knows. Could be a distribution company they contract out to now for distribution of the product. Could be someone who makes other parts. Could be Chinese manufacturing company? Anyones guess until they PR it. I will wait and see. It's obvious at this point in time that it would most likely be paid by issuing additional shares. Will that dilute us? Depends on the value received from the company being acquired. Have to wait and see.
8. Reverse split. While it may be anyones guess as to when this may happen, I would think they would want to let the current PPS play out and settle a bit before doing something like that. It was discussed months ago the purpose of a R/S would be to pursue uplisting. If that is truly the case, then you wouldn't want to do that if PPS share takes a dive on Monday. If they give it a chance (via PR's LOI etc) to maybe run up to 3 cents, then a 100 for 1 reverse split would give us a $3 per share price. But I would think if the purpose is to uplist, you would make sure everything else is in place before addressing the R/S. Guess we will see.
9. Price Monday. Could go a number of ways. I would expect initial decline as many have stated. But I would also expect that some longs and even some old Aero shareholders (having restricted shares) might start buying some if it dips too low. I would expect the two to balance out a bit of each other. I don't expect any really new buyers to come in from outside of FCCN or Aero. So if more sell to get out, we'll end with a dip. If more longs/Aero buy on dips then those wanting to get out, we'll stay stable or even slight green. I will not do like many and say sub-penny or 5 cents or 50 cents as that is fruitless. I watch the market and see what happens.
10. Pietro/4kids etc not being on the board when all this is happening and FedEx leaving as mod. I respect FedEx's opinion and have always paid attention to his posts, they have helped my pursuit of this play. I wish him well and sorry to see him go from here, but I fully understand. Many have bashed Pietro/4kids for not being here, but they were temporarily banned, so that is why you haven't heard from them. You can always check the ban list to see who is banned and for how long. I look forward to them returning.
I know this was long, but I waited all weekend to save all this up and get it into one post. Remember it is IMO. I do not plan on selling or buying on Monday. I like my holdings and don't have any powder to add more if I wanted to, so that is my standings.
I don't think anything here was off topic so I hope everyone gets to read it.
Thanks, and good luck in coming days.
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