Shareholder Question
Good Sunday sir. I am texting to ask if you have ever thought of a share repurchase program? I read in your blog potential investors want you to raise the price in order to receive the loan. Maybe this way everyone wins. Use a percent of the loans to go toward repurchase program, some towards JV, Pps rises and more loans come in. At this price it seems you could buy on the open market for around 6 months and retire 500 million to a billion shares. It would make a lot more appealing moving forward and clean up the books.
Answer
Thank you for your question. You have anticipated one facet of our strategy to support our shares long term. There is a way in which shareholders are in a “win-win” situation, if we can alter our operating conditions somewhat.
If Winning Brands can generate sufficient operating net profit and allocate the surplus in two directions, debt repayment and share re-purchases, then shareholders can benefit from share repurchase (because the repurchases are not just short term and temporary).
Two alternatives can exist, and both are positive.
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The alternative scenario is that the positive circumstances of the company cause the share price to increase beyond an affordable buyback scenario. In that case, the buyback is a moot point because the price will be considerably higher than it is now – and that will be good for shareholders too.
Accordingly, the top priority is to find a way to add profit flow to Winning Brands. This may be possible through astute joint ventures in which Winning Brands’ partnership is “purchased” through its effort and JV service contribution, rather than cash. We are working on some of those scenarios now.
Aside from all the fancy planning, some things in life come down to plain old-fashioned good luck. We seem to have been getting some lucky breaks recently. These have a way of creating a new vibe that leads to favorable outcomes. One should not depend on luck of course, but plenty of success stories have had special moments of good fortune.
Let’s be open to all of these things.
Cheers,
Eric Lehner, CEO
