Ron, Michael, I agree with you guys. Having spoken with I.R. this afternoon (and listened to part of the conf. call replay), it's clear to me that the company is repentant, but that does nothing to restore any of our major capital losses nor the credibility of this management.
As I pointed out to I.R., one of the continuously misleading indications from the company was the very positive tone and outlook in the annual report, which we only got, what, in the last month or two?
Other items from my conversation with the co. (and pardon me if any of this is repetitive):
1. They won't be doing any more acquisitions in the near future, until they get their house in order. So much for being the powerhouse consolidator in their niche?
2. There won't be a write-off of the diminished value of their DBCO stock unless they sell it (no current plans to do so). Apparently them not having to do so may be a variation between Canadian GAAP and U.S. GAAP (with Eco utilizing the former).
3. Head count reduction is already underway to adjust to current conditions. But due to severance costs, etc. which will evidently be expensed rather than taken as a charge, the cost improvement of the cuts won't be immediately felt.
4. I asked what sacrifices the senior management was making to acknowledge the situation. The I.R. person mentioned McGinnis' 300,000 shares of open market stock bought at $9 to $11, which has obviously tanked alongside the rest of ours. But she could not give me any other specific info (i.e. salary or bonus cuts) with respect to him, Norris or anyone else.
5. All subsidiaries will be required to provide weekly "flash" revenue reports to give senior management a more timely view of what's going on in the field.
One of you said the $1.20 miss was the signal to leave. I couldn't agree more. I hate to say it, but (speaking for myself) this is a case of "do it to me once, shame on you, do it to me twice, shame on ME".
Good luck all,
Chris |
