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alstry (< 20)

SPF Lying, Cheating and Stealing?



March 08, 2008 – Comments (0)

Right now SPF has almost twice as many spec homes completed or under construction compared to backlog.  No other public HB comes close to % of spec homes UNDER CONTRUCTION to backlog.

Why would SPF be building so many specs when almost every other builder has publicly stated that they have pretty much stopped building specs?

Is it because SPF's management is doing just about anything they can to generate revenues (NOT PROFITS) try to siphon shareholders' and creditors' cash and assets into their own pockets?

Late last year management eliminated the shareholder's dividend.  The stated reason to save cash.  To save cash for what?  Simply to give management millions in CASH payments as a bonus early this year.  As a bonus for what?  For losing MORE money in a single year than this company has lost in its entire existence as a public company.

Now, management is trying to set itself up to get even bigger CASH payments.  They want millions and millions more.  They want cash payments equal to 150% of their already very generous salaries.  Here it is:

...the target bonus will be payable as follows: 40% based on the Company’s achievement of a targeted level of net new orders 1 , 30% based on the Company’s achievement
of a targeted inventory level 1 , and 30% based on the Company’s achievement of a targeted revenue level 2 . The target bonus will be adjusted up or down based on the extent to which actual performance exceeds or
falls short of the target 3 .

Notice, not a single word regarding the "target" bonus relates to profitability.  Basically, are these guys are being incentivised to LOSE money so long as they generate enough revenues, deliver enough homes, and sell down enough inventory so MGT can get paid millions in bonuses? 

Something seriously wrong seems to be going on here folks.  What kind of independence exists on the board to allow this kind of clause?

Not only that, management KNOWS it publicly inflating the value of the assets relative to the current market value of the assets.  Why are they doing this?   So mgt can keep this charade going on as they line their pockets with money otherwise belonging to shareholders and creditors?

SPF management and board last Fall cut off the dividend to shareholders.  It is liquidating corporate assets at over 4X the rate it is paying off creditors.  They are liquidating those assets at HUGE losses.  A three legged mentally impaired donkey could lose money at a slower pace.  ALL THE WHILE management is lining its pockets with millions in cash......much of which generated from gotta be kidding!!!!!!!!!!

SPF is now running out of assets fast.  Much of the little in assets that remain are not fairly valued on the books.  Those assets are the last remaining security for the BILLIONS AND BILLIONS in debt and belong to shareholders.  As SPF is liquidating itself to nothing, instead of forwarding that money to shareholders in the form of dividend, management is taking cash and giving it to themselves.

At the current pace, epecially considereing the inflated current asset values, pretty soon, this company will be liquidated to practically nothing.  There will not be much left for creditors and even less for shareholders.  All the while management keeps bonusing themselves stuffing shareholder's cash in their pockets as they quietly take money.

We are a nation built on ingenuity and hard work.  This kind of parasitic behavior must be stopped or such behavior could become accepted practice in our public companies.  It this spreads, the entire public equity system could be in jeopordy.....if we not already there now.

Is SPF current management going to rack up billions and billions in debt, lose billions and billions of shareholder's money, siphon and stuff millions and millions of cash into their pockets, and in the end leave shareholders and creditors holding the bag?  Is the above behavior lying, cheating, and stealing?  I leave that answer for you guys to respond to.............


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