Sirius Trouble Ahead 44 comments
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It is with great distress that I put pen to paper, or in this case fingers to keyboard. Sometimes people believe that SiriusBuzz is SiriusPump. Nothing could be further from the truth, and the buzz right now is Chapter 11. In a filing with the SEC, Sirius XM (SIRI) states:
- In the event such uncertainties remain unresolved, management anticipates that KPMG LLP’s auditors’ report relative to the Company’s 2008 consolidated financial statements will contain an explanatory paragraph indicating substantial doubt about the Company’s ability to continue as a going concern.
- … the inclusion of such a paragraph by KPMG LLP would result in a default under certain indebtedness of the Company, XM Holdings and XM Satellite Radio Inc. (“XM Inc.”) which defaults, if not cured or waived prior to the expiration of the applicable grace period, would result in an event of default under other indebtedness of the Company, XM Holdings and XM Inc. Such events of default, if they occur, provide the lenders the right to demand all amounts due under the respective agreements immediately due and payable.
In a nutshell, unless Sirius XM retires its May debt prior to its 10K being released, its only choice is Chapter 11. A simple statement of potential default is reason to cause a default in this case.
A further problem develops as we learn that the company itself is examining whether it makes sense to continue operations under such economic circumstances. All of this had been relative to operational results as of December 31, 2008.
Management has not yet completed its evaluation as to whether substantial doubt exists relative to the Company’s ability to continue as a going concern for a reasonable period of time. A significant element of that evaluation relates to uncertainties associated with funding of amounts stipulated in the aforementioned Investment Agreements. These uncertainties may not be resolved by the time the Company files its Form 10-K with the Securities and Exchange Commission.
Unfortunately, auto sales data for the first two months of Q1 2009 shows that it is even more likely that the company will come to the conclusion that it cannot continue operations under its current debt and contractual obligations. A 9.1 million run rate and 1.7% churn rate equal a net loss of nearly 2 million subscribers in 2009 by my calculations, which have been heavily challenged in the SiriusBuzz forums.
I have used the following assumptions in my calculations:
9.1 million auto sold times 50% penetration rate = 4,550,000 new installations.
4,550,000 new installations times 50% penetration (currently running below that) = 2,275,000 new oem subscribers.
21,000,000 subscribers times 1.7% monthly churn = 4,284,000 deactivated subscribers.
4,284,000 - 2,275,000 = 2,009,000 subscribers to be lost in 2009
As for any talk of why Malone would have stepped in. The answer may be as simple as intending to keep the assets out of the hands of Charles Ergen, so that some form of Sirius might emerge after bankruptcy.
Position: Long SIRI
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BK my arse - May debt resolved per Sirius and Liberty:
Sirius WX press release:
investor.sirius.com/re...
Liberty press release:
ir.libertymedia.com/ph...=
wow, this article couldn't have been more wrong. Sorry Brandon.
Six days till report, and you can expect it will have the effect of petting a porcupine. Sweet but painful. Bet the shorts are getting nervous---now if just a few of us LONGS hold on rather than rape the pop- maybe we'll see it go over .25-30 cents..... Yeah- right, I'll sell the pop too! Cost ave is still up about $1.20....
"SIRIUS- onlyavalableatwamog".
Might want to pull this article to avoid a possible lawsuit. To even reprint this article, especially after everything in it is proven false, TODAY NO LESS, LOL would be a wise call. YOu wont run his manipulation article, and you should pull this POS too. This will be my last post, as SA is currently being boycotted, and will no longer be clicked on by around 200 people who used to follow it.. Have fun with your Sirius articles in the future. I suggest no one read their bs articles anymore.
Well my friend...I rest my case. Turn out the lights, your party's over..and so is your career writing negative hack articles 'bout the dog. Today is what's known as getting your d**k caught in the slicer, bro. Ouch...and couldn't of happened to a nicer guy!! Enjoy the rest of your broken career. Oh and next time you go fishing with your other sensationalist MSM buddies like Doug M, Slick Rick, et al...you guys have a great time talking about your former jobs..don't forget to bring enough Schlitz!! Later.
Long SiriusXM
On Mar 06 05:44 PM mlongj wrote:
> It is good to see the regulars have returned. I had a hard time following
> you guys to the different sites. Hopefully no one will be kicked
> off again. Good to see the Liberty deal is final. All the 2009 debt
> has been considered and that burden is now history. Got the average
> down to .202. I feel like it was a good decision to throw the house
> at this stock again. Hopefully I will not regret the decision. Thanks
> sl 62 for your encouragement on the move. I probably would not have
> gone through with this unless you has voiced support.
>
> Long SiriusXM
It is up from here with a big shot of Malone in the jet fuel!!
On Mar 06 10:11 AM relmar2003 wrote:
> This article is a joke, and trust me, there is no "buzz" on siriusbuzz
> about this being legitamite. In fact member after member disagreed
> with him, and told him the article is nothing more than fearmongering.
> Of course seeking alpha picked it up. Brandon is in fact ALONE on
> this accessement. Even the originator of the idea is the forum dicounted
> it as being "likely".
> Brandon is a sensationalist with no foot to stand on here.
> No worries, there is no BK. This is no more relevant than saying
> this..
> If they auditors mention a concern about their viability to exist
> without the second Malone deal, Malone wouldnt loan them the money.
> If JP Morgan extends the May debt, Malone will loan SIrius the money
> to pay of the other part. If they dont, which would only happen
> if the Malone deal didnt go through. You see, its circular logic.
> Makes no sense, and Bandon isnt smart enough to figure that out apparently.
>
> Its all contingent on it all coming together at once.
> 1. May debt is extended.
> 2. Malone initiates 2nd phase of loan.
> 3. Auditors DO NOT PUT A CONCERN paragraph on the 10k.
> There you go. Its all quite silly really.
The article was wrong and Mel has resolved all of the 2009 debt
obligations. Wow......I will sleep well tonight!!
Now for the conference call and some exciting synergies!!
How about a Big Fish to buy in and take this Globally?
Anyone for The Apple Satellite Network? Or Google Satellite Network?
How about Att or RIMM?
Let's get this party started!!
On Mar 06 01:27 PM Rockotodd wrote:
> finance.yahoo.com/news...
>
>
> wow, this article couldn't have been more wrong. Sorry Brandon.
On Mar 06 05:44 PM mlongj wrote:
> It is good to see the regulars have returned. I had a hard time following
> you guys to the different sites. Hopefully no one will be kicked
> off again. Good to see the Liberty deal is final. All the 2009 debt
> has been considered and that burden is now history. Got the average
> down to .202. I feel like it was a good decision to throw the house
> at this stock again. Hopefully I will not regret the decision. Thanks
> sl 62 for your encouragement on the move. I probably would not have
> gone through with this unless you has voiced support.
>
> Long SiriusXM
we're not back. this was a rare appearance to refute something ugly that never should have hit the wires (a tornado which was actually born in our new home right in front of our eyes). We were asked to leave here so we did (to SBzz). We're settled in. Hope you can join us sometime...
However any mention of the sec filings and the possibility of bankruptcy before dec 31st is all a joke.
Like I said before this company will loss and write down 1.2 billion for the 2009 year which will further dilute stock.
Liberty Media now owning 40% of common will dilute stock.
Margins for profitability are now further down the road to mid or late 2010.
Sirius is in the toilet this year lets face reality. BK was almost a near possibility this stock will not break .30 cents.
On Mar 07 01:05 PM BigVinnie wrote:
> Brandon is some what right with his growth rate calcs.
>
> However any mention of the sec filings and the possibility of bankruptcy
> before dec 31st is all a joke.
>
> Like I said before this company will loss and write down 1.2 billion
> for the 2009 year which will further dilute stock.
>
> Liberty Media now owning 40% of common will dilute stock.
>
> Margins for profitability are now further down the road to mid or
> late 2010.
>
> Sirius is in the toilet this year lets face reality. BK was almost
> a near possibility this stock will not break .30 cents.
On Mar 08 01:05 AM BTR wrote:
> I will be sure and keep in touch after we pass .30 so you can eat
> your words .
On Mar 06 11:29 AM slk wrote:
> Bad math....
>
> "21,000,000 subscribers times 1.7% monthly churn = 4,284,000 deactivated
> subscribers"