Mel Karmazin Video Provides Some Answers
People invested in satellite radio have been looking for answers… any answers. They have had a strong desire to hear from the company, and want to know what the plans going forward are. In a perfect world, we would all have these answers, but in today’s environment, even good news simply seems to get washed up in a vortex of negativity.
In the midst of all of this, Mel Karmazin did an appearance on Autoline in which he discussed the current situation, and in particular focused on the OEM channel. The interview does not give all of the answers, but does provide some answers and insight that investors are seeking. The video is well worth watching, and at less than 30 minutes long, does not wipe out your schedule. Grab a cup of coffee and click and watch.
Thanks Muscle
Position: Long SIRI
Thanks Tyler. Everyone make sure to watch the extra 7 minute clip on this page. Good stuff. It hints at some possible interesting surprises down the road.
Great info. Would have been nice to hear something about the refi though. Either way, he stuck to his sub, rev, and exp numbers, so that is good.
I just can’t see how a company with 2.7B in revenue can’t get the capital it needs to work through next year.
Will someone paraphrase this vid? Can’t watch it on my phone!
Does anyone else think Mel looks a little gaunt? Looks like he’s lost some weight.
Although it was GOOD to see a NEW clip of Mr. K….I don’t feel anything “new” was said.
But it’s obvious from the video that according to Mel refinancing has been tough in this credit crunch. Still as Jon pointed out above…it’s curious that a company with 2.7 B in revenue hasn’t been able to announce a refinance deal yet.
Also Mel “alluded” to the “SUCKY” stock price without saying it “SUCKS” this time by saying that until they have positive EBITDA in 2009…analysts won’t have anything to base it on. Hence we are in limbo in the eyes of the investment world.
Mel mentioned nothing about Reverse Splits and further dilution tho. Two of the BIGGEST concerns recently for shareholders.
But forgetting all that, based on the video alone, the two biggest things that stood out for me were the mention of Internet Radio in the car. To me this is like being able to see the ipod coming. It’s a window onto our biggest competition in the car and one that Sirius should take very seriously. For all Mel’s talk about “content” and that the internet might have ALOT but not like Sirius….worries me. Mel can’t take this threat lightly. Its gonna be HUGE.
Mel also mentioned something “Secret” in the works with car companies that SOUNDED interesting….but was so vague that it amounted to nothing. I’m sorry, but we’ve had enough of future promises. We don’t need “secret” whisperings to give us hope. No more false promises and hot air.
We want REAL answers. And this video gave me nothing as a shareholder that makes me feel better. More of the same ol same ol. Sounds good…but at this point rings hollow.
And NONE of the current fears about a RS or dilution or debt were answered.
It makes me wonder if Mel is going to wait until the LAST minute in February till he is FORCED to announce another one of his “UGLY” deals.
This delay in securing financing of the debt is like deja vue with the merger close all over again.
I’d LIKE to be confident. I WANT to be confident. But past experience has taught me I can’t expect ANYTHING.
I am soooo tired of being in LIMBO with this stock. 18 months of merger delays with NO PAYOFF. And now we are back in LIMBO waaaaaaaiting for refinancing the debt. It’s like NEVER ENDING with this stock.
Anyway…thanks for the video.
Video was somewhat informative. It seems the bottom line to it all is that the refi must take place reasonably and have profit in 2009 before the pps can climb to shareholder expectations.
Good interview
Mel stated about every reason why most of us became stockholders.
300 million profit in 2009 is the goal, and it sounds like SiriusXM is on track based on the OEM numbers and synergies alone to hit that number even with reduced car sales in 2009.
Mel did not talk much about retail sales unless he was referring to the portable devices,or the used car market.Almost like retail is icing on the cake as well as telematics.
The only thing standing in our way is the Refi of the loans.
I agree with Jon that the sales and growth of SiriusXM cannot be ignored by lenders.
I wonder why a lender would not come forward that wanted to make a decent return and not get into bed with SiriusXM on all three loans staged over a period of time?
The profitability of SiriusXM can pretty well be seen at this point in time going forward.
It has been something all of us stockholders have been waiting for.
Mel made it sound like it is very tough going on the money lending side though.
If we can get the re-fi, Oct-Nov of next year the stock will be an outperform.
The following year 2010 would be a great year also.
Wish something on the reverse and issue of more shares was addressed, and more info on the refi loans.
imho
vaporgold
any thoughts about what to do with the other half of the bandwidth? He said they plan to only offer 145 channels not 300. What will they do with the other 145 channels since he said he doesn’t want to pursue TV?
Friggin…
Another ugly loan deal would set us back…I don’t want to even think about it.
The reverse and stock issue we need answers on
vaporgold
MOST IMPORTANT THING ANSWERED WHEN ASKED WHAT HE WANTS THE MOST FOR THE COMPANY RIGHT NOW, AND HE ANSWERED “to make money.”
I LIKE THIS ANSWER FOR TWO REASONS:
1. i like the attitude that comes with the “to make money” answer. Glad he understands this, and probably does better than anyone.
2. NOTICE HE DIDN’T SAY THE ABILITY TO REFINANCE DEBT!!! super duper important, because to me, that implies that he is not worried about it, well at least not overly so to be his number 1 concern. HE NEVER EVEN CAME CLOSE TO MENTIONING REFIN. ISSUES AT ALL!!
It could just all be cover up, but some debt holders sure took shares instead of cash recently. And if I know anything, I am sure that they had a peek at the SIRIUS cash register in order to help this debt holder decide on ownership of his new shares.
Friggin…
I feel the same way. Every time we think we are getting close something happens and we are screwed for another year or two.
Is the screwing this time the reverse split and issue of more shares?, or another as you put it UGLY loan deal that sends us reeling?
We are so close to getting things right.
I will wish and hope for the best.
imho
vaporgold
I listened to the interviews. The one overriding impression that I got was that it did not sound like Mel is going to take this company into bankruptcy.
Keysmark
I feel there are 2 major pairs of issues…
1) The first being the Debt Refinancing and positive EBITDA in 2009 that Mel promised.
2) The Second being the talk of a 1 for 50 Reverse Split and possible dilution of shares to 8 Billion.
I WANT to see the FIRST pair reached WITHOUT having to resort to the second pair!!!!
I want to be able to erase ALL talk of doubt….ALL talk of “conspiracy” that some are saying Mel is doing to wipe out all shareholders and start over.
If the debt can be refinanced AND we see positive EBITDA emerge WITHOUT resorting to RS and further dilution…then all such talk would be erased. We could FINALLY move on and shift all our focus to the true promise Sirius has alluded to all these years.
But I am afraid that IF a 1 for 50 RS or further dilution happens BEFORE the debt refinancing and positive EBITDA…then it will PROLONG this environment of uncertainty that we Sirius Shareholders have suffered thru for FAR too long.
Tyler, thanks. This is a good start on getting more information directly from Mel. Please keep us informed whenever he makes a public appearance. If we follow his appearances then, as we go along and do content analysis, we should be able to see a more accurate and complete picture of the circumstances and direction from his perspective.
Winagain35, to say that Mel looks a little thin makes me wonder if you are saying what has been speculated about Steve Jobs. Say it ain’t so.
He might look a little thin, but that’s a huge improvment from what he’s been looking like lately….. INVISIBLE !!! This technology is just so damn amazing to me, with such great potential, that I just have to believe that if Mel can’t get the company back on course (and profitable), then somebody else would love the opportunity. Wipe out that debt, and this thing could still take off. It’s all about perception, and right now nothing is happening to inspire any confidence or excitment about the product/service. Convince the masses that something is cool, and they will buy it. They don’t even have to love it. I am sure that a large percentage of I-pod purchases are made by people who don’t necessarily love the God damn thing – they want one because their “cool” friends have one. There is an awful lot of resistance from people when it comes to paying for radio, yet the TV and the cell phone and the bottled water and all the other shit that they squander their money on isn’t an issue. It is a very strange phenomenon, and I don’t understand it. Terrestrial radio really isn’t free; you pay in the form of horrible playlists and mind numbing commercials. I still think that 43 cents a day is pretty good bang for the buck when compared to the obscene prices they charge for entertainment these days. Been to a concert lately? How about an NFL, MLB, or NBA game. The average person can’t even afford to go to one of these events, and to take the family for most people is out of the question. How about a Broadway show? The cost of one ticket could easily pay for a years subscription to satellite radio. The argument that satellite radio is too expensive is, in my mind, a bunch of bullshit. I think that the biggest hurdle that satellite radio needs to overcome is the incredible ignorance of the American public. I’m no genius, but of this I’m certain; there are an awful lot of people out there who will NEVER subscribe to satellite radio. EVER. But…. there are probably millions who would if they could be convinced that it is a cool thing to have. Apple conviced an entire generation that they need to have an I-pod. If Sirius/Xm could convince 1/10th as many people, it would be huge. Not even 1/10th. Good product + GREAT MARKETING = HOME RUN. Come on Mel; come out of your cave, take off your burka, and create some enthusiasm. Time to be the legendary salesman that you allegedly are. And one more thing – stop bullshiting us, Mel.
When did Mel get remarried?
There is rumor out of Germany that GM is about to go tits up next week. Anybody up on this rumor?
The $700 billion bailout money is not to be distributed until AFTER the election. You can be certain that Goldman (entrenched) will be the first pig at the trough. Further, there won’t be anybody getting ANY financing done until the $700 billion gets loose and they see which outfits soak it up. IMHO, it will be totally spent in two weeks. Between Goldman and Morgan Stanley (piggy no. 2), the two outfits could conceivable consume the entire amount.
Youse guys covered Mel’s speech very well. I have nothing to add.
Well…the NY JETS won today, so I’m happy.
Cheers.
Keeping score
Karmazin left Viacom with the full value of his $30 million contract, plus stock and options worth some $250 million. Including salary, options, and bonuses, he collected $31.2 million at Sirius in 2006.
In person
Impatient, aggressive, obsessive, imperious, tight-fisted: they’re the traits that have made Karmazin an extraordinarily difficult boss and an extraordinarily effective corporate manager over the years. The sort of boss who used to regularly review the phone and travel bills of his underlings, his obsessive focus on the bottom line earned him the respect of shareholders.
Married his second wife Terry in 2000.
No joke
While at CBS, Karmazin kept a telescope in his office trained on the offices of rival NBC across town.
I am absolutely shocked Charles didn’t censor the comment “Thanks Muscle”.
Patrick, What is Stebford? Did you mean Stepford? Like Stepford Wives?
Will Mel extend through 2010 to see this company through their 1st profitable year ?
I think he should and will, but then I think he needs to retire because he is not looking good lately.
I heard nothing new.
Just a rehash of previous statements.
This guy is an idiot!!
Totally trashed XM and his own company as well!!
They were originally going to MERGE WITH XM and allow them to keep all streams…..
Heh,they lied!!
They are in the process of destroying the whole network….
I dont understand why XM doesnt fight this matter,they cant like whats happening!!
This is totally disgusting.. I dislike Sirius and now 1/2 the stream are thier garbage!!