H3 Enterprises Releases Sales Report w/Few Numbers

H3 Enterprises, the company that created the HipHopSodaShop, has announced its "first full monthly revenue report for 2008."

Basically they give a description of what's happening without real financial figures except for the claim attributed to CEO Benjamin Chavis:

"Despite the fact that we have yet to touch our marketing budget for Tampa since all 48,000 University of South Florida students were on winter break during our first month of operation, we still managed to take in over $125,000 with accelerating sales growth rates."

I spoke briefly with H3 Enterprises' Tanya Munro who's in charge of Investor Relations and she says they are generally sharing all the public information they're making available in these press releases though she's going to double-check with Dr. Chavis regarding this revenue report.

Though I see no reason to cast doubt on the revenue figure, I do feel this press release/report is a good example of why investing in OTC and BB stocks can be perilous due to the lack of full financial reports.

The USF winter break ran from around December 15th to January 6th so that would affect sales if a large part of their base is USF students though one might also expect a response from local folks in holiday mode checking out the new store including students from other schools that are in Tampa to be with their families.

Since this report covers January revenue figures, that means they lost a week at most, though students usually get back at least a couple of days before school starts.  It also raises the question of why they haven't spent money on marketing since that returning crowd would be ripe for new adventures at the start of the school year and should have been receptive to a focused, campus-based marketing campaign if they are, in fact, going to be receptive.

More complete financial information would help clear up this confusion and make this press release/report appear to be more than a marketing tool for the stock itself.

Update:
Ms. Munro got back to me with the official word that, for the moment, all publicly available financial information is included in the press releases.  However they do intend to be more forthcoming in the near future and I think that's a really good thing for both H3 Enterprises and for investors.

One of my biggest concerns regarding so-called penny stocks is not that the companies are necessarily being shady by not disclosing information because they're not legally required to disclose as much as companies that operate via more stringent exchanges.  But lack of disclosure means that companies on BB and OTC exchanges can be more easily gamed by criminal elements with absolutely no connection to those in the company.

So exceeding their disclosure requirements will ultimately strengthen a company like H3 Enterprises even though that means folks like me will have even more to work with in our critiques.  While one of the strengths of being private is the ability to manage one's public image more thoroughly, long term that's just not a viable strategy for any public company that wants to build a solid, lasting enterprise.  So if H3 can follow through, they'll be taking an important but not always pleasant step towards realizing their grand vision.