Allen, there's something I really don't understand, and maybe you can help me out here.
PNL keeps adding more and more content
spending a lot of money relative to real revenues,
and hiring a lot of people to get stuff done
being paid with options (ie. "non cash comp"),
but hasn't generated any revenues to demonstrate
that any one is really showing up to their
field of dreams.
Looking at how PNL reported revenues first
I had to take exception to the "barter" amounts.
Barter is an assigned value for services received.
This isn't one penny, nickle , or dollar really
received.
PNL's balance sheet assigns a value in the "plus" column
that is in revenues, then immediately assigns the
corresponding line item in the "minus" or expense column
thus effectively balancing the item out.
This to me is analagous to selling 10 books for
$100 that I bought for $100. Creative accounting
to make the PR look better IMO when announcing revenues.
So when you look at the "real" revenues excluding
the "barter" amounts how much money is PNL been
making for all their efforts?
Well per the first quarter's report let's see:
Membership............ $2,935
Advertising............$21,745
For a whopping $24,680 in real revs for the 1Q
For the past nine months the "real" total
was approx. $51,000 w. $7,000 coming from
memberships and $44 thous in advertising rates.
These real numbers are too miniscule to be indicative
of any trends up, down, or sideways.
Conundrum is, without members and eyeballs, space on
PNL-tv and on web pages can't command the higher prices.
Other problem w/o members is that datbase isn't filled
out with relevant info. The D & B database has always
been not quite as impressive as advertised again IMO.
Now I haven't watched PNL-tv too closely.
Don't have broad band so I find watching media on my PC
kind of annoying. Keeps breaking up or losing content.
So can't personallly assess whether this new means of
generating revenue vai. commericials and infomercials
will really mean anything. So far per the SEC filings,
PNL-tv doesn't appear to be generating significant revenues
despite the numerous PR's annoucing shows and features.
In time, hopefully it will catch on....this will
take a long run way.
So if PNl is generating any money how are they paying
everyone? Well per the 10q under expenses there is
a significant cost associated w. "non cash compensation"
or, in other words, options. Not unusual for a start up
plus not too dilutive per the terms of the stock option
paln and vesting requirements as noted in the 10q.
(Max. 3 mill shres. but exercise price appears to
be flexible re: time option vest meaning no specific
conversion price set).
Well, anyway, hopefully PNL's revenues will start
to "rev" up. Otherwise you might see and S-8 filed with
an expansion of the option plan w. more options converted
at lower prices just to pay people. This could get
dilutive. Hopefully also more REAL revenues will be
generated so further additional financing won't have
to be sought out which could be highly dilutive. (JP
appears to still have 17 of his 34 or so mil shares left,
so I'd imgine most of what he's been selling has made its
way back into sustaining the company so
resorting to additional more dilutive financing
will be minimized like w. prior PP's. However,
this does mean that the float has significantly increased).
Burn rate relative to many start-ups isn't bad, but
web site development costs alone far excede real revenues.
Marketing obviously is the biggest expense now.
Hopefully this marketing will pay off, though
so far it doesn't appear to be especially in lieu
of the changes in philosophy regarding how revenues
will be generate.
Thus Al, PNL truly is a field of dreams being
built brick by brick. Or, if you wish to choose
to use another metaphor- this plane needs a very
long run way before it will "take off".
PNL b-plan is very complex, trying to continually
add the content sought out in the trade community
to its "trade portal" ie. one stop shop.
The site is a great convenience, but changing the way people
have always done business and attracting customers will take
TIME and patience.
THis isn't a "rocket ship". Thus I don't
know what "big" news is forthcoming, but I'd
really not expect any rapid increases in the stock's price
until the b-model can demonstrate that it can
increase revenues let alone generate earnings
especially since the latest tulip bulb craze subsided
several months ago.
Anyway, that's just my point of view.
Take it or leave it. Thank Roy for asking me to share
my thoughts.
I still hold a small position, but I really don't
see any "real" reasons or developments on the horizon
that will make me want to purchase any more shares for
the foreseable future.
Build it and they will come.
Build it and they will come.
Well, they're building it quite nicely, getting
to be quite a park. When and if "they" come (ie significant
enough traffic and members to site to generate
substantial revenues via membership and costs from ads),
then "maybe" I'll get back in line
for a ticket to the game.
See ya,
Sincerely,
z
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