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I asked you to show some business results if you think they are doing a good job. In business, words are easy, but it is only the financial results that matter. You are making a case for a company, which I said earlier still relies far too much on it's 1980s business model, has pissed off huge numbers of customers, and which has let many rivals move in and take customers away with newer technology and relevant business models. On top of all that, they have a huge debt relative to their market cap.
So where are their business results? They were delisted from the NYSE just two weeks ago which is going to severely impact their ability to move forward. Sure they have some valuable assets, but assets don't keep a company from bankruptcy.
Talk is cheap.
Lumbollo, Blockbuster actually benefits from being delisted at the moment. Since they are in negotiation with bondholders they want to look weak. As soon as their debt gets resolved (which in an earlier post I mentioned is extremely likely to happen) a strategic investor like NCR corp or Comcast is poised to inject about $100 million into Blockbuster. These corporations have told Blockbuster to first settle debt and develeverage their balance sheet before they provide cash infusion.
As for business results I mentioned in earlier post that March Same-Store-Sales went up this year. This was due to a huge increase in sales of titles Blind Side, Shelock Holmes, and Avatar. Blockbuster reports its 2Q earnings in August.
Blockbuster Inc. said in a regulatory filing late Tuesday that it was suffering "significant liquidity constraints," and could have to file for bankruptcy protection if it was unable to convince creditors to restructure a big chunk of its debt or its business continued to deteriorate.
The company has had to close about 1,300 stores and wants to shut down hundreds more. It had about 5,200 stores worldwide in January, excluding franchised shops. About 3,500 of those were in the U.S
"The increasingly competitive industry conditions under which we operate has negatively impacted our results of operations and cash flows and may continue to in the future. These factors raise substantial doubt about our ability to continue as a going concern," Blockbuster said in a regulatory filing late Tuesday.
The company is trying to update its business, setting up video rental kiosks like those run by Coinstar and offering a DVD-mailing service. It added 2,000 kiosks in 2009 and expects to have more than 10,000 by the middle of this year — but NCR Corp., which operates the kiosks, is "under no obligation" to install or run them, Blockbuster said.
Blockbuster Inc. said in a regulatory filing late Tuesday that it was suffering "significant liquidity constraints," and could have to file for bankruptcy protection if it was unable to convince creditors to restructure a big chunk of its debt or its business continued to deteriorate.
The company has had to close about 1,300 stores and wants to shut down hundreds more. It had about 5,200 stores worldwide in January, excluding franchised shops. About 3,500 of those were in the U.S
"The increasingly competitive industry conditions under which we operate has negatively impacted our results of operations and cash flows and may continue to in the future. These factors raise substantial doubt about our ability to continue as a going concern," Blockbuster said in a regulatory filing late Tuesday.
The company is trying to update its business, setting up video rental kiosks like those run by Coinstar and offering a DVD-mailing service. It added 2,000 kiosks in 2009 and expects to have more than 10,000 by the middle of this year — but NCR Corp., which operates the kiosks, is "under no obligation" to install or run them, Blockbuster said.
This pretty much confirms what I said above.
Lumbollo as I explained above Blockbuster is in negotations with its bondholders. It is thus in their interest to present as weak a position as possible. Think about this: NCR just announced that it will be installing several thousand more Blockbuster kiosks before end of year. What does that mean?
Honestly, I am not trying to be mean but this does show that you dont understand the subject matter. Blockbuster purposefully put out a gloomy SEC filing. Anyone following the company knows that.
.... It is thus in their interest to present as weak a position as possible. ....
Are you saying that Blockbuster is making false and deceptive statements to the SEC for the purpose of fooling investors? If so then I think that puts the final nail in this conversation for me. Good luck with your "research". You are going to need it.
Are you saying that Blockbuster is making false and deceptive statements to the SEC for the purpose of fooling investors? If so then I think that puts the final nail in this conversation for me. Good luck with your "research". You are going to need it.
What I am saying is that it is painfully obvious that Blockbuster is stretching in its SEC filing (not providing false information) to paint as gloomy a picture as possible while providing no positives.
READ THIS:
JULY 7, 2010
“As a shareholder, I am very positive about the company’s global brand and the value of the global brand,” said Jason Ryder, an investor and analyst with Third River Capital, a Chicago-firm that invests in small cap stocks. Ryder has covered Blockbuster (NYSE: BBI) for years.
“As a customer, I am positive about their subscription by-mail product because of the ability to have new releases delivered before Netflix,” he said. “I am looking forward to the video On Demand access to be added to the Xbox 360, Wii and Playstation 3, in addition to other equipment.”
“Last week was a great example of excess volatility in the market without proper cause. Blockbuster, as with other companies, have too many short-sighted investors waiting for news. The investor base combined with poor communication of the management team has put negative pressure on the stock price.”
He added that he believes “Blockbuster is worth much more than the current enterprise value.”
“I continue to feel that BBI has many options, but concerned that the management team is not reviewing all of the options in the best interest of the shareholders,” Ryder said when asked about the chance of a bankruptcy filing.[LEFT]
He is essentially saying Blockbuster will not go bankrupt but may not have an agreement with bondholders that results in a favorable position for shareholders.
Blockbuster is about 36 months behind the game. Netflix and startups such as ultra violet should give them serious concern.
A valid point that was mentioned here was customer opinion of Blockbuster. I think we all remember being forced to pay late fees (even though they changed that). The damage has been done, Blockbuster has lost the technology race and lost public approval.
Blockbuster is about 36 months behind the game. Netflix and startups such as ultra violet should give them serious concern.
A valid point that was mentioned here was customer opinion of Blockbuster. I think we all remember being forced to pay late fees (even though they changed that). The damage has been done, Blockbuster has lost the technology race and lost public approval.
Certainly a good point. Blockbuster has angered many customers in the past through various behaviors, whether it was ridiculous late fees or their hypocritical censoring policy. But BB still produced over $4 billion in revenue last year. The video rental market is so large that many different companies can survive even when taking a small slice of overall pie.
If you look at interviews that CEO Jim Keyes gives he explains that long-term (not short-term) blockbusters competitors are not Netflix and Redbox but companies like Amazon and Apple. As I said earlier Blockbuster simply has a different business model than Netflix, one which they have been diligently implementing the last 3 years as the company goes through a complete transformation.
Btw reason Im asking is supposedly these ads are only running in Charlotte region and a decision hasnt been made whether to air nationally.
I have seen them and they didn't change my opinion on Blockbuster. I think a nationwide campaign would be a waste of money.
Quote:
Originally Posted by soxfan371
Thanks for all the responses again. Im a marketing student studying the video-rental industry which includes blockbuster, netflix, redbox, cable companies like comcast, hulu, and best buy and wal mart to name a few.
Hmm...you seem very defensive to only be a marketing student/loyal customer.
I have seen them and they didn't change my opinion on Blockbuster. I think a nationwide campaign would be a waste of money.
Hmm...you seem very defensive to only be a marketing student/loyal customer.
Sorry if I came off defensive/aggressive etc. Having a bad week...
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