3Q11 Summary

It was not a good quarter for the stable’s financials. We had very limited success on the track and as the Canterbury meet came to a close, the decision was made to cut the cord on a few of the horses and realize some losses. The prospects for 4Q11 don’t look much brighter as the first few days of entries at Hawthorne would suggest that the competition in Chicago will be much harder than originally thought. For example, we tried entering Swift Progress in a race that was barely filling with enough entries during their Spring meet that had 34 entries this week. Translation: we likely won’t catch any weak fields to run in and we will have to rely on drawing into the races as they come up.

The best plan right now is to run each horse at the lowest possible levels in hopes of hitting the board enough to simply offset their expenses. Ideally, they will get claimed away from us and we can proceed with winding down the stable and cashing everyone out. As of 9/30, I calculated a share value of $4.35. Approximately 85% of this valuation is represented by cash. So as I said earlier, if we can come close to breaking even on the cash flow, we should be able to liquidate at or near that share valuation prior to year-end.