Long or Short Capital

Unaudited Financial Results for FY’06

Income Statement

Contexual CPC Revenue $335.45

Static Ad Revenue $183.43

Other Revenue $32.13

Total Revenue $551.01

Cost of Sales $98.65

Marketing Expense $174.09

Operating Income $278.27

Balance Sheet

Cash $0

Accounts Receivable $177.12

Inventory $0.00

Prepaid Hosting/Reg $125.50

Accounts Payable $0

Cash Flow Statement

Operating Cash Flow $278.27

Tax Distributions to Partners $80.00

Capex $0.00

Dividends $X.00

Performance Metrics

Visits 119,920

Pageviews 212244

Clicks on ads ~767

Ad impressions served ~410000

Subscribers by Email 50

Subscribers by XML 232

Inbound Links per Technorati 154

Inbound Links per Google ~71 sites

Past Results (due to our reliance on SAAP, previous unaudited financial results are not reliable)
Long or Short Capital Q1’06 Results
Long or Short Capital Q2’06 Results
Long or Short Capital Q3’06 Results
Long or Short Capital Q4’06 Results

Long or Short Capital’s fiscal 4th quarter ended on 7/31/06, and the company reported their results for both Q4’06 and FY’06 in a press release on their site:

Mister Juggles: “Long or Short had 4th quarter performance in line with management’s expectations for the slower summer months. Sequential same store traffic of 21%. This is the key figure I would like to share with you in today’s call, and while there are other figures that would show what we have done, these figures would be much more ambiguous, some could even be used to make our results look “not so hot.” Sequential same store traffic is a like-for-like measure of our number of visits in Q4 compared to Q3. As you can see, we were 21% more trafficked than last quarter, a growth rate which is the best in the Online Financial Humor/Abstract Investment Recommendation Industry.

We generated earnings per a subscriberholder of $0.38 compared to $0.32 in Q3. Our accounts receivable is a little higher than we’d like it to be due to unfavorable payment terms and a one-off timing issue with one of our largest accounts. Working capital was also challenged by our securing of a 5 year extension of our domain registry costs, which was payable up front. Revenue was flat sequentially but our reliance on Yahoo CPC advertising has been reduced and our runrate revenue should be at a higher level. In the Yahoo segment, our click through rate increased 20% sequentially, but that gain was offset by a 34% decrease in our revenue per click. Our suscribership increased from 161 to 282.

We now have $115.56 of Payment-in-Kind (PIK) debt which is off-balance sheet and was previously undisclosed. Management has experience operating in a leveraged environment, and the debt should be reduced substantially by the end of Q1’07 from working capital.

We passed several milestones in our first year, including our 30,000th visit to our new storefront, as well as 100,000th visit overall. We also fell in love. We hope that in the coming year we can repeat what we did well last year, and improve on it, by approximately 5-7% in every measure.

Note that the financials below are unaudited and may contain non-GAAP measures. All numbers comply with Seldom Accepted Accounting Principles (SAAP).

Unaudited Financial Results for Q4’06

Income Statement

Contextual CPC Revenue $38.47

Static Ad Revenue $78.50

Other Revenue $14.11

Total Revenue $126.08

Cost of Sales $19.55

Marketing Expense $0.10

Operating Income $101.43

Balance Sheet

Cash $0

Accounts Receivable $190.14

Inventory $0.00

Prepaid Hosting/Reg $115.05

Accounts Payable $0

Cash Flow Statement

Operating Cash Flow ($34.83)

Capex $0.00

Dividends $X.00

Performance Metrics

Visits 16,900

Pageviews 31,850

Clicks on ads 100

Ad impressions served 55,000

Subscribers by Email 50

Subscribers by XML 232

Inbound Links per Technorati 154

Inbound Links per Google ~71 sites

Past Results (due to our reliance on SAAP, previous unaudited financial results are not reliable)
Long or Short Capital Q1’06 Results
Long or Short Capital Q2’06 Results
Long or Short Capital Q3’06 Results

In Jordan, drivers for tours are not legally permitted to also be tour guides. So while it makes sense that a Jordanian driver for a group of 50 Germans, who speaks pretty good deutsche and happens to know a little about Nabatean culture, also lead the guided tour of Petra when the group gets there, he cannot. He will not be allowed. Instead, he will pass his group to a specialist licensed tour guide. While “economists” and other fake scientists may see this as wasteful, what this really does is create jobs. Where 1 job should exist, 2 jobs exist and the proletariat rejoices.

We suspect that this kind of job creation is the perfect way to solve the Middle East’s burgeoning shortage of jobs for the large young cohort which is entering the labor force. Simply take one job, split it in two and you have two jobs. Why haven’t governments thought of this sooner?

I wish that that the government mandated that if you work in finance, you could not also sexually harass female employees yourself, someone else had to do it for you. It would really free up my work day.

Monopoly is a metaphor for life in many ways. For instance, people often claim the outcome depends little on skill and largely on luck. In reality, the best way to win is the same as in life: become the banker and then skim off the top. However, this equation may change with Monopoly’s introduction of a version that uses debit cards rather than cash. This trend should reduce the demand for Monopoly money and increase the velocity of virtual currency.

Furthermore, cheating will become more costly as the requirements have increased from merely being bold, sly, or sticky-fingered (aka a generic finance type) to having a computer science degree (aka a generic nerd). This will represent a shift in the labor supply curve of thieving bankers. Increased regulation and greater financial transparecny should also serve to reduce shadow market opportunities in the greater Monopoly market, such as trades in “One in every currency for rolling snake eyes” or “All the cash in the middle for landing on Free Parking.”

Following our report on Sexual Harassment Arbitrage, Helen Green, a woman who was a secretary for Deutsche Bank in The City area of London, sued and won £800k in damages for being bullied. Not sexually harassed. Not groped or oggled by her lusty depraved male handlers. Bullied by her female peers.

Green had told the High Court that she worked in a “department from hell,” where a “gang of four” women subjected her to “mobbing” and “stonewalling,” and that a male staff member spoke to her in a sexist and degrading manner.

Mr. Justice Owen said: “On any view, the behavior of the women was oppressive and unreasonable. [Welcome to Finance!]”

It is beyond my analytical acumen how Deutsche Bank could be responsible for bullies; it seems responsibility should have been attributed to the parents of the “Gang of Four” in an after work meeting with the principals. A picture of Helen Green underscores the power women assets have, not only in terms of sexual harassment arbitrage, but in terms of female harassment arbitrage as a whole. You do not even have to wield the pretty, to wield your womanhood. £800k for “silent tears” and a case of the sads is compensation not available to men of any level of attraction.

This is a response to all those who emailed doubting the veracity of the camel’s affinity for Coke. A camel sipping Coke and a camel chugging a Coke bottle. We value empiriscm above all else.*

*Unless empiriscm was empirically proven to be less valuable than some other measure.

Camels are the navy of the desert, capable of porting goods across terrain that is otherwise inhosptiable, even to trucks. The shipping and transport of goods is crucial to modern global economies. Is the camel industry poised to benefit from the contagion of the emerging Middle East market?

Ahkmoud, my desert guide in the Middle East last week, shared these facts with me on camels:

1. Camels can go without food or water for long periods of time from 6 days up to a month depending on the conditions.
2. A camel has a powerful sense of taste. Ahkmoud remembers a camel that would only drink Coke, when offered a Pepsi he would refuse. When offered Pepsi or water or other substitute liquid within a Coke can, he would catch onto the ruse, the clever beast, and spit it out.
3. Camels only have sex once per year (hence the term “sexual camel”). If you happen to disrupt a camel humping (pun intended), the camel will remember you as his enemy for the rest of his life.
4. Camel milk can cure cancer, if it is caught early (Ahkmoud insisted it had to be within the 1st two weeks).
5. The Koran says that if you want to know Allah, you need only look to the camel.

The typical pick-up truck costs you $20k, requires constant refueling, will overheat in the desert, pollutes the earth, cannot discern between Coke/Pepsi, and cannot cure cancer. A fully grown camel costs the USD equivalent of $1300 to $1700 with none of those drawbacks.  And for all of that, all he asks is you turn your head once a year while he bangs out the two humped camel babe he met in eastern Turkey. 

Recommendation: Long the Camel, growth in automobile use has sucked the world dry of oil while simultaneously causing global warming. The world will soon be a hot desert with no oil and the only way to get around will be on coke-drinking camels.  We also recommend exposure to flying camels which should take significant share from Airbus and Boeing after they are FAA approved later this year.

• 15 Gazan Palestinians = 2 kidnapped Israeli soldiers or approximately 1/100th of a young white Alabman woman
• 0.5 young white Alabman women = 5mm Rwandans
• 1 Princess Di is worth 1.25 Africas
• 500 Darfurians are worth approximately 2 US soldiers
• 150,000 South Asian tsunami victims are worth 1800 Southeastern US hurricane victims
• 1 JonBenet Ramsey = .738 Elizabeth Smarts
• 10 US hostages = cargo plane full of “defensive arms”

Gold is your chance. Gold is everyman’s opportunity… Every defect in a man and in others’ way of taking him, our agreement that gold has value, gives us power to rise above… The value I gave the gold restrained me, you see, your utility in connection with it. And because of my gold, those at the other tables deferred to my restraint… Gold confers power. Power comes to any man who has the color… That is our species hope. That uniformly agreeing on its value, we organize to seek the color.

-George Hearst, on Deadwood

Past Quotes Entirely Relevant to Investing

Following the release of Long or Short Capital’s Third Quarter financial performance, the company is offering a $0.60 dividend per a subscriberholder as of 4/30/2006. To qualify, all you need to be is a subscriber, either by XML or E-mail, as of 4/30/2006. For more information on how to collect your cash or cash equivalent dividend, please refer to our revised Dividend Policy. Given our float of 161 subscriberstakes (as of 4/30/2006), a 5% growth assumption and our dividends to date, our current capitalization is $22,181 using a dividend discount model.

Attractive people have a unique arbitrage opportunity. All thing being equal, they are more likely to be hired for a given position than a less attractive peer. But all things remaining equal, they are also more likely to be sexually harassed by their superiors than a less attractive comparable employee. This gives attractive people the opportunity to “double dip,” so to speak. They can gain employment and the ensuing compensation by virtue of their looks; then they can compound their returns by getting sexually harassed and filing multi-million dollar suits (see past analysis of Diana Bianchi and Ms. Kobayashi of Toyota).

We recommend that firms re-evaluate the implied costs of hiring attractive labor. It’s possible that external benefits of having an “office hottie” outweigh the expected value of sexual harassment litigation, but we deem this to be unlikely. A study we conducted using sophisticated envelope trend analysis illustrated that an “office hottie” added 20% production growth to a firm vs a comparable employee, but all-in labor costs were twice that of a comparable employee. A firm should be able to achieve an improved cost structure just by hiring less attractive employees. On a long term basis, as markets converge to efficiency, attractive people assets should see declining valuations. On a short term basis, attractive people assets can seek to increase their earnings by wearing suggestive outfits (miniskirts for women, bow ties/suspenders for men) and enticing their superiors.

During the first period of a man’s life the greatest danger is: not to take the risk. When once the risk has really been taken, then the greatest danger is to risk too much.

-Soren Kierkegaard

Past Quotes Entirely Relevant to Investing

Long or Short Capital’s fiscal 3rd quarter ended on 4/30/06, and the company reported their results in a press release on their site:

Mister Juggles: “Following our best quarter ever, Q3’06 occurred amongst a background of industrial turmoil, rising oil prices, the month of March and global uncertainty. In that context, we are satisfied with our results and if we continue to pour our beakers full of managerial brilliance into this frankenstein we are confident that our Q2 performance will be more predictive of our future results than Q3. While management’s options were underwater at quarter end, a board approved “Put the Options Back in the Black” KERP plan was initiated ensuring that management will continue to be properly incentivized.

We generated cash earnings per a subscriberholder of negative $0.22 a positive increase of negative 46% over last quarter. We were cash flow positive for the 1st time in history with $35.14 of cash flow before dividends and tax distributions; this is mainly attributable to an improvement in working capital. Revenue decreased 38% sequentially, but increased Div/0% year-over-year. We faced both a 50% decrease in our click through rates for our contextual advertising and a 50% decrease in revenue per click. Our suscribership increased from 85 to 161, almost doubling.

Operation Sir-Click-A-Lot was an abject failure, and had no effect on our top line. Traffic wise we performed in line with expectations. The first full quarter at our new storefront @ longorshortcapital.com has proven to be all we expected, and its strategic location between longorshortcapitak.com and longorshortcapitam.com has given us a steady flow of captive readers.

Note that the financials below are unaudited and may contain non-GAAP measures. All numbers comply with Seldom Accepted Accounting Principles (SAAP).

Unaudited Financial Results for Q3’06

Income Statement

Contextual CPC Revenue $71.58

Static Ad Revenue $38.02

Other Revenue $11.00

Total Revenue $120.60

Cost of Sales $15.00

Marketing Expense $50.00

Operating Income $55.60

Balance Sheet

Cash $55.83

Accounts Receivable $88.10

Inventory $0.00

Prepaid Hosting $30.00

Accounts Payable $0

Cash Flow Statement

Operating Cash Flow $82.96

Tax Distributions to Partners $80.00

Capex $0.00

Dividends $X.00

Performance Metrics

Visits 13,950

Pageviews 26,150

Clicks on ads 90

Ad impressions served ~43,874

Subscribers by Email 34

Subscribers by XML 127

Inbound Links per Technorati 108

Inbound Links per Google ~40 sites

Past Results
Long or Short Capital Q1’06 Results
Long or Short Capital Q2’06 Results

Following the release of our report on Diana Bianchi my gf initiated coverage with a “Not Hot/Pretty” rating:

“She’s not hot. she’s pretty but hot is reserved for much more than what she is. but i’m sure she’ll be digitally altered in your boy magazines and you guys will be perfectly fine with it [editor’s note: and we will be].”