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Longstanding investor in Looksmart (and a 70 yr old ex-tradesman), who has a passionate interest in the problems of newspapers along with their success in all their monetisation attempts made, on the web. For the "times are indeed, a changin", I feel. [17th of Aug, 2011 - Print media... More
  • Looksmart Reports Comprehensive Income? What does that Mean? 0 comments
    Aug 3, 2011 9:16 PM
    Looksmart have been profitable for the past 4 quarters & have almost predicted or, have assured all, of it likely to be remaining profitable in the future.

    It is in their interest to continue to be profitable, for many reasons!

    The Company have 'in place' what is, a ....

    Profit-Sharing Plan for all non-sales related employees including executives. - Under the Plan, eligible executives may receive cash incentive payments based on the Company's achievement against certain revenue & profitability goals. The profit-sharing percentages for each eligible executive at 100% attainment range from 25% to 40% of eligible compensation earned during the quarter.

    8-K Current Report  08/02/11

    But ..... because what the market perceives as being very poor and "dwindling" revenues as announced quarter after quarter, the LOOK share-price value has suffered for so long, accordingly. - And the Co has not helped at all, in this regard.



    So, with the Company not advising the market (before today, I feel?), that Looksmart now (apparently?), only reports Comprehensive Income, what else can be reasonably expected?

    And who in the market really is the wiser? Apart from insiders and patient share accumulators? The question now is - - for just how long has this been the case (if it is indeed so), as it does appear to be? 

    Looksmart have been reporting it's quarterly revenues that are now surely all about being Comprehensive Income and are or, have been presenting them in such a fashion for how long now, one wonders?

    What does it mean?

    < Comprehensive Income

    The income of a company from any transaction that does not involve an owner's investment or distribution to an owner.

    For example, if a company exchanges two currencies for practical, rather than investment, purposes, any profit from the transaction may be considered comprehensive income. Comprehensive income contrasts with net income
    . >

    I had broached this very subject in my previous instapost ... And the Co have only just (I feel) advised of it within today's 10-Q : bottom page 7 [Recent Accounting pronouncements]

    10-Q -
    quarterly report -
    08/03/11

    Looksmart (yesterday) reported Revenues coming in/derived from the Company’s Advertiser Network as being $6.3 million in the second quarter of 2011, as against $12.1 million had in the second quarter of 2010 and $8.1 million in the first quarter of 2011. - The reaction?

     50% REDUCTION in Revenues Sharemaggedon to Ensue

    Re: UNIMPRESSIVE HMmm? "O"

    The total paid clicks for the second quarter of 2011 were 146 million, compared to 190 million for the second quarter of 2010 & 146 million for the first quarter of 2011.


    The Co also advised that, the: 
    Average Advertising Network RPC (revenue per click) for the second quarter of 2011 was $0.043 - when compared to $0.064 in the second quarter of 2010 and $0.056 in the first quarter of 2011.

    So for Q2 2011:
    ($0.043 Xs 146 million ='s $6.278M)

    But, in stating it's advertising network revenues, Looksmart clearly, are NOT talking in those "gross" type sales revenue numbers (before distribution), like the many other, same industry (& not disimilar), Ad Networks are!

    eg; ICLK? They only netted $100,000 on $26M in stated revenues, last quarter? (ReachLocal have posted Q2 revenue of $92.8 million, up 32% from a year ago - and yet, STILL 'managed' a loss for the quarter of 3 cents a share)

    http://blogs.forbes.com/ericsavitz/2011/08/02/reachlocal-q2-revs-miss-but-loss-smaller-than-street-forecast/?partner=yahootix

    InterClick [ICLK] have a Market Cap, of
    : $172.00M

    ReachLocal [RLOC] have a Market Cap of : $519.61M

    Local.com [LOCM] have a Market Cap of : $73.25M

    Looksmart [LOOK] who reported having cash of $26M yesterday (and, on today's close), have a Market Cap of, just : $25.91M ?

    [For Q2, Linkedin saw it's revenue more than doubled in the second quarter to $121.0 million, from $54.9 million a year earlier. Profit also rose, albeit slightly, to $4.5 million in the quarter, from $4.3 million. - LinkedIn Ekes Out a Profit, as Sales Surge]

    Yet Looksmart (during the Q2 period), had announced that in the past three months, the Co has generated ONE MILLION in free cash flow.

    So..
    (?)

    If Looksmart were only receiving say 5% of a winning bid commission made across it's advertising network or, OPEN marketplace (and, I feel it is 8% or, more), this would then have represented the Company's
    advertising network revenues as being in the region of around (6.3m X's 20), $120 million for the Q2 Period! 

    ****************
    From the Form 10-Q / Quarterly Report

    Recent Accounting Pronouncements
     
    With the exception of those stated below, there have been no recent accounting pronouncements or changes in accounting pronouncements during the six months ended June 30, 2011, as compared to the recent accounting pronouncements described in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2010, that are of material significance, or have potential material significance, to the Company.
     
    In May 2011, the Financial Accounting Standards Board (“FASB”) issued a new accounting standard on fair value measurements that clarifies the application of existing guidance and disclosure requirements, changes certain fair value measurement principles and requires additional disclosures about fair value measurements. This new guidance is to be applied prospectively.

    The Company is required to adopt this standard as of the beginning of 2012. Adoption of this new guidance is not expected to have a material impact on the Company’s results of operations, financial position or liquidity.
    In June 2011, the FASB issued a new accounting standard on the presentation of comprehensive income. The new standard requires the presentation of comprehensive income, the components of net income and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements.

    The new standard also requires presentation of adjustments for items that are reclassified from other comprehensive income to net income in the statement where the components of net income and the components of other comprehensive income are presented. This new guidance is to be applied retrospectively.

    The Company is required to adopt this standard as of the beginning of 2012. Adoption of this new guidance is not expected to have a material impact on the Company’s results of operations, financial position or liquidity.

    ****************

    All, just an opinion as always.

    LOOK:
    3:59PM EDT: $1.50  Up 0.06 (+4.17%)

    LC

    ps; In a previous instablog I was filthy about a low share-price value that suited management ... I wrote:

    While Industry Insiders continue accumulating all they can daily & with LOOK's own Board members -- being issued with such low cost (strike rate) options - - on top of their having had profit sharing in place now, for the past 3 or, 4 profitable quarters, is almost bordering on being criminal - is my (own), totally disgusted feeling. 

    tinyurl.com/4xwadp6

    Shame Looksmart, SHAME!!

     View this filing in your web browser. Brian Gibson May 11th

    May 10, 2011

    Form 4 / Knorr, Bert
    HTML PDF

    Form 4 / Kauffman, Scott L
    HTML PDF

    View all SEC Filings  -

    "Oh what a tangled web we weave, When first we practise to deceive"! (Sir Walter Scott)

    Disclosure: Long LOOK but wishing for more honest type disclosure....
    .

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