COPIA Truth in Finances

COPIA’s CEO Garry McGuire is a very interesting study in contrasting statements to different media sources. Here are just a few examples as they relate to COPIA’s bottom line.

July 20, 2008: Sacramento BEE (SB)- “After his appointment, McGuire told the Napa Valley Register that Copia had broken even for the first time in 2007. Yet a review of its financial statements indicates large losses and negative cash flows for that year.

Asked to reconcile the two, McGuire told the Bee that he meant to say that Copia ‘almost’ broke even if you match operating revenues against expenses, numbers that exclude its debt service costs and its bond payments.

November 24, 2008: decanter.com, (A British magazine and online wine industry information source) - Copia is US$78m in debt – but that debt is tied to the property itself: 'Independent of the buildings, Copia is a healthy business,' McGuire said.

December 1, 2008: Santa Rosa Press Democrat - The source of Copia’s new financing wasn’t disclosed and center officials couldn’t be reached for further comment Monday.

The center’s largest creditor is Winston & Strawn, a San Francisco law firm that handles corporate finance issues. Copia also owes money to a brand marketing consultant, public relations firm, a restaurant group, newspapers, magazines and more than 100 other vendors.

December 2, 2008: SB - McGuire said Copia has secured a $2 million line of credit that will allow the center to pay employees and suppliers.

I fail to understand how on July 20, 2008, COPIA can break even on operating expenses versus patron donations & sales revenues, yet just over four months later, Mr. McGuire announces the acquisition of a $2 million line of credit (LOC) by which to pay over 100 bills (Dec 1 article above) and employee wages & salaries. But, don’t forget, the LOC must also be paid back.

He says in the November 24 article above, that “,,,Independent of the buildings ,Copia is a healthy business.” If it’s healthy then why a LOC to pay vendors for operating costs and good to be sold? If it's "healthy, "why move to San Francisco?

How does Mr. McGuire expect to run at a deficit already without paying on a mortgage yet think that a new landlord will be willing to have him as a renter?

How the heck will he raise new investor capital and sales revenues, not borrowed money, to pay vendors , employee wages and rent to the landlord if he’s closed four out of seven days a week?