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Leading Brands Inc. Message Board

  • EquityMaestro EquityMaestro Jul 15, 2008 1:09 PM Flag

    More Misleading Comments from Pig-Face


    In the Q1 press release, the title reads "Proprietary Branded Beverage Gross Revenue Up 32.9% over Prior Quarter". If you do your homework, you will notice that LBIX has usually described proprietary branded sales growth on a YEAR TO YEAR basis. For example, this excerpt from the 8-31-07 quarterly earnings release describes year-over-year branded beverage growth: "Sales of the Company's proprietary branded beverages grew 55% year over year."

    So, why the change? The answer is simple. Year-over-year proprietary branded beverage growth, which is the true measure of whether or not LBIX is growing, was only 0.42 million, or less than 10% growth. In other words, proprietary branded beverage growth is BARELY growing because new placements are barely offsetting the revenue losses associated with discontinued chains like 7-11.

    Like I said, continue to do your homework. Pig-face is one tricky mofo, and he is good at getting more bagholders to pile in even when things aren't going so great.

    Also, what about STOKED and Die-Hard? They appear to be doing NADA. The viability of LBIX is entirely dependent on TrueBlue.

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    • Good post. I heard the same thing from my local BK drive thru guy a few weeks back.


    • The statement regarding Walmart Canada is the only time in many years that I recall ever hearing about specific results for a particular chain. Even then, it was mentioned just because TB made the top ten selling grocery items at Walmart. So, I do not think that the silence since then means that TB no longer sells well at Walmart in Canada. silence is just that -- Silence. No one but you seems to think that the CEO has to report sales by chain monthly.

    • freshbread $tate$ "Remember it was not all that long ago when TB was one of the ten best selling grocery items in Wallmart Canada. It may still be selling well there -- who knows?

      If that were TRUE, don't U think the CEO would have TOLD U so since he's BIG on PUMPing whenEVER he has half a chance ?!?!?!


    • Bayou--

      While your question is clearly relevant to LBIX's future, it is one that we cannot answer since there is no breakdown of sales by chain available. We know that TB was dropped in a few places or that -- as Ralph claims -- it was withdrawn to try to get at least 6 sku's in place. I think it was mostly dropped. We also know that there are a large number of new listings that were trumpeted in the early months of this year. But we do not know how well those accounts are doing. that is why I have consistently said that the sales results for the current quarter are the most important ones. they will give us a truer picture as to how well TB will sell in the US. I will not pre-judge these results, especially since the rewards for success are so much greater than the results of a failure. It is also true, as Hotpanera points out, that Canadian sales have done fine. Remember it was not all that long ago when TB was one of the ten best selling grocery items in Wallmart Canada. It may still be selling well there -- who knows?

      Listen, unless the results of the next quarter are catastrophic, the stock will not go much lower than it already is IMO. LBIX could just pull out of the US and go back to selling TB profitably in Canada and bottling and distributing for others there. In fact, at a fire sale, I am sure that CCE or some other bottler/distributer would want to buy LBIX just for its Canadian routes. So let's say that the most likely floor under the stock price is 50 cents. On the other hand, if sales go well, there is a potential for a very large upside.

      You may be correct and the stock may tank as a result. Nevertheless, the risk reward analysis is one on which I will bet for now.

      By the way, do you have a source which will allow you to get a sales breakdown by chain? Or are you just deducing your position based upon annecdotal evidence?

    • eat me pig moron?

    • Sales in various chains in Canada have been doing well for many years. Wal Mart is just one that Ralph has mentioned favorably. If any Canadian chains have dropped TB, I've certainly never heard about it and nobody has so claimed here. Remember that Canada is still about 75%. I'm not picking that number out of a hat. On the conference call before this one I asked about the % of U.S. sales and Ralph said "about 20%". An analyst asked on last week's call about the relative change in growth in Q1 in the 2 countries, and Ralph responded that it was about the same, but it is starting to diverge with the U.S. growing faster. So 75% is probably fair.

      Now, there is no question that for the U.S. portion that there have been some growing pains, incompetence, loss of accounts, etc. There have also been new accounts and various anecdotal reports of success. I recognize that slotting fees (which I believe are amortized over 12 months and won't all hit in Q2) are expensive and wasted if a chain is lost and the U.S. is still a question mark. But with a strong established base in Canada and all kinds of opportunities in the U.S., particularly in convenience stores that are just starting to be taken advantage of, I have reasonable hope that there will be success. Not in every store of every chain or every city. But after some experimentation and some wrong initial moves, a favorable group of stores will be fixed upon where TB will sell well at a reasonable prices. For such a tiny company, it won't take all that much for success. It is easy to list a number of failures and conclude that Lbix is finished. I just don't believe that and remain long. Frankly at this price, it's nowhere near a close question that the risk/reward warrants holding the stock.

    • Remember, they are going to put their slotting fees into earnings over the next 12 months...I assure you they will be profitable in this quarter. Pig face is smart when it comes to figuring this stuff out...he knows the stock needs to get over 1.00 and it will get there.

    • There is no reason to guess about the magnitude of the branded product sales. According to the company's filings these sales were up 12.6% or $420,000 over the same quarter last year. Simple math shows that the total of sales last year for branded products were 3.33 million for the quarter. That makes sales this year 3.75 million dollars. Because of seasonal variations, I annualize this sales rate at about 12.5 million dollars. Still, if the current quarter goes well, we could easily get to an annual sales rate of 14 million. Even higher remains possible.

      I still do not know the exact revenue per case for each product, so putting out sales in cases is not something that I would attempt, but to me, it does not matter much if I get valid sales volumes in dollars.

      Within the last year, there have been beverage companies sold at multiples of ten times sales or higher. With the depressed market, that multiple of sales is probably out of reach, but it will serve you well to remember this: If LBIX gets to 14 million in sales of branded products, a multiple of three times sales gets you a price per share of $2.10 without ascribing any value to the other business of the company. In short, with some minimal success for TB, the stock could easily triple from here.

    • This is the statement from the Sedar. It's not less than 10%:

      "“The company’s distribution business continued its transition from primarily distributing third party beverage brands to a focus on developing and marketing its own brands of beverages resulting in the company’s branded beverage sales up 12.8%”".

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