Admittedly, my business experience is fairly limited.
I did have a small business once in geological engineering.
Picked rocks on my brother's farm in Saskatchewan.
Got paid in ice-cold Pilsner.
Now, I'm ready for a new startup that just might outlast that VisuaLabs 3-D TV deal that was such a smashing success for shareholders - as a tax writeoff.
I figure this is the real deal. My company's going to be the leading provider of creative alibis for publicly traded companies with frightening quarterly earnings releases. Just call me Alibi Inc.
I mean, is this thing a no-brainer or what? What $10-million-a-year CEO worth his salt wouldn't want a few good excuses to cover his butt over the latest earnings stunner. With earnings season for third-quarter financials heating up and many companies looking for ways to soften the blow, demand for our services should explode. This could well be the next big thing. The next Google.
If your company has swung from profit to loss, play it smart. Pass the buck. Remember, it's never your fault. And relax - Alibi Inc. will find a timely excuse for you. We'll write that press release. We'll take care of damage control. We'll baffle the shareholders into submission. You fill in the numbers at the end.
You're going to be hearing a litany of excuses for disappointing earnings, but sometimes you need to take passing the buck to the next level.
Sure, this market is ripe with convenient excuses. In those scary press releases that almost always come out on Friday, everybody will be pointing a finger at hurricane Katrina, hurricane Rita, hurricane Ralph (Goodale, the finance minister), killer energy costs, the loonie's strength versus the U.S. dollar and, of course, the farmers' trusty alibi - the weather.
However, sometimes you need to kick your imagination up a notch or two. If your online gaming company, say, has swung to a loss in the third quarter, you may need to pull out all stops. Maybe this time you can't blame the price of crude.
That's where Alibi Inc. can ride to your rescue with a spiffy press release to calm the masses and prevent that stampede to the exits.
As a sneak preview of our new enterprise, here's a sampling of the kind of service you can expect from Alibi Inc.: HOOTERVILLE - Rock Paper Scissors Gaming Inc. is pleased to announce our financial results for the third quarter of 2005.
Due to extenuating circumstances, Rock Paper Scissors lost $3 per share in the third quarter, barely missing the street's estimate for a profit of $5 per share.
"The dog ate our software," explained chief executive officer Royal Flush.
You think that's too far-fetched?
Don't worry, the Rock Paper Scissors stockholders will eat it up.
Hey, I know a shareholder who still thinks her delisted Air Canada shares were exchanged for ACE Aviation shares since the airline's restructuring.
If your airline's financials suck, we won't just play the killer fuel-price card. We'll give your shareholders peace of mind. We can explain that your planes were empty because of the fear of flying and that your daredevil pilots have promised to stop those nifty single-wheel landings.
If your income trust has had to cut its monthly distribution to unitholders, we at Alibi Inc. will massage your unitholders so they stay in the game.
When everyone else in the income trust sector is lynching Ralph Goodale over the government's review of the income trust tax structure or blaming it on flirty girl in receivables, we'll provide a fresh angle. We'll tell them that the CEO splurged on $18-million shower curtains, but relax, gang. We're pretty sure it's just a one-time charge.
When your computer-sales business becomes mired in a sea of red ink, the last thing you want to do is alienate your shareholders with the standard alibi of the exchange rate cutting into your margins.
In a pinch, Alibi Inc. can bring out the heavy artillery.
We'll tell them about the sudden resurgence of typewriter sales and how your company's vision is to enhance shareholder value by acquiring a typewriter company.
Those automakers certainly deserve a tip of the old fedora for their proficiency in refusing to look in the mirror when it comes time to report their horrid financial results. Yet, they shouldn't rest on their laurels.
If people aren't buying your cars, why not throw your shareholders a bone rather than whine about the unions or the fuel prices or the tapped-out consumer?
Tell them that the advent of a new fashion trend has spooked consumers. That a comeback of the 1950s Humphrey Bogart fedora is the culprit. We could pacify your shareholders by informing them that you're planning to redesign your cars with a chimney built into the roof of your cars to accommodate the fedora.
If you don't think they'll buy that, consider for a moment that there are investors out there who actually still buy shares in a TSX crapshoot called Stelco.
Say, wasn't it a stock-market player who invented rose-coloured glasses?
* GOLD-PLATED VIEW FROM TOKYO: "Gold will probably touch but not necessarily hold $500 (US per ounce) this year, then sometime during the first half of next year, $500 will become recognized as the new floor for the market, setting up a possible test of $550 or even $600."
- Koichiro Kamei, president of Tokyo-based Market Strategy Institute Inc. in an interview with Dow Jones Newswires.
* TRUSTWORTHY OR FOOLHARDY: Hedge fund manager Jean-François Tardif of Sprott Asset Management says he's still buying income trusts for his Sprott Opportunities Fund, but emphasizes caution while investors play the waiting game during the federal government's review of the sector.
"I have no idea what will happen with the income trusts," says Tardif, who boasted a one-year return of 70 per cent on his fund through August, largely on the strength of some high-flying income trusts.
"I admit that if the income trusts were cancelled completely, obviously you would get a selloff in the sector. But if you think a company will grow 50 per cent or 30 per cent and you think it's cheap, maybe it's worth buying some of the trusts today. Still, we have to be conscious because there's more risk now. We're a hedge fund here so we go long on certain companies we like and we short other companies we don't like."
Tardif says his fund has a 17-per-cent weighting in income trusts. Two of his top three picks are income trusts (see Pro's 3 Stars on Page 18).
Hot Stock
Microbix Biosystems
TSX:MBX $1.11 Up 33 cents (+42.3 per cent) on 394,000 shares (based on weekly stats through Oct. 6 for Canadian stocks over $1)
What's this? No more surprises from Bossy at calving time? Well, at least those bulls who were holding shares in Microbix weren't bawling over the news from the Toronto biotech company. Microbix sent its stock soaring when it reported the acquisition of a sperm-sexing technology that would enable agriculture producers the advantage of sex selection prior to conception.
Cold Stock
Art In Motion Income Fund
TSX:AIM.UN Down $1.37 (-24.8 per cent) on 488,100 shares (based on weekly stats through Oct. 6 for Canadian stocks over $1)
If you're an income trust investor, you must be feeling like a punching bag these days. No doubt, you're already feeling punch drunk over the carnage resulting from the government's review of the sector. Then, your trust hits you with a nasty uppercut, chopping your income in half. Which is exactly what happened to Art In Motion unitholders. The Coquitlam manufacturer of fine art reproductions chopped its monthly distribution payment from 10.4 cents per unit to five cents per unit for October, citing a weak U.S. dollar.
(Gyle Konotopetz can be reached at gyle@businessedge.ca)
