Wednesday, September 7, 2016

PLCB financials 2016. How'd I do?

In a surprise move showing more competence than....well...then they ever have before, the PLCB released its unaudited financials only 60 days after the end of the fiscal year. Sure beats the 122 days it took last year. I don't know if this is a trend or perhaps an outlier. (It's probably got something to do with no privatization bills currently under consideration in the Legislature. -- Lew)

As always they sent out a press release saying how great it was that a police-enforced monopoly that doesn't allow any competition, with a rising population and increasing prices, had record sales. I always like it when they claim how much they "return" to communities. Communities that would get the fees on their terms and their schedule if the PLCB wasn't mandated to act as the middle man.
And of course the big self-congratulations: "Hey, we collected taxes and turned it in!" Just like thousands of businesses do every year, only they DON'T send out press releases saying LOOK AT ME LOOK AT ME!!

Speaking of press releases, this one said to go to to see the unaudited numbers.  You had to look hard because the link did't take you there! It wasn't found under the financials tab or in annual reports, but in the board meeting minutes. To their credit, they did move it to an easier place to find it when I mentioned it to them. Now if I could only get them to spell Jack Daniel's right...

So what did this really tell us, minus the hype? The big thing I got out of it was that total liabilities went up over $105 million in one jump and for all the crowing about record sales, the $238.7 million they were in the hole last year only went down by about $550,000. That's right: $550 thousand. Chicken feed. And inventory went up 9.4% again, even though the marvelous bailment was supposed to reduce it! It has gone up $70 million in four years, and if it jumps that much again next year, it will be higher than it was before bailment.

Well, how did I do on the predictions?  Let's see.

1. The normal amount of squawking about "record sales and profits" when that isn't going to happen. Collecting taxes is not making a profit even in PLCB Bizarro business world. Of course with a police enforced monopoly, rising prices, and more citizens,  why wouldn't there be record sales? A private system would generate even more sales.
This was really a gimme because we all know they were going to do that. Nailed it!

2. "Record amounts of taxes collected" will be big in PLCB world, but again, with a police-enforced monopoly, rising prices, and more citizens why wouldn't there be?
Again, who are they trying to impress?

3. I predict that "Net Operating Income" will decrease for the third year in a row, even with "record sales."
OK, I'm eating crow on this one.  Surprisingly it went up about 19%.

4. Prediction: "Store, Warehouse, and Transportation Costs" have gone up for the last few years, albeit only 3% last year but I think it will be 5% this year. didn't go up 5%, it went up 8.9%!

5. "Administrative, Alcohol Education, and Support Costs went up over 29% last year and 9% the year before. They will go up again by 8-10% this year.
Of course, the PLCB didn't group these together this year, so I can't compare apples to apples. But Alcohol Education did go up, so even if the others stayed the same, the total went up. I wonder if the education budget is higher then the advertising budget this year? They don't list that, so one never knows. Education is what they should be doing anyway, so after cutting it so much last year, it is good to see it up again.
6. The PLCB finished out last year almost $240,000,000 in the hole. I don't think that is going to change too much so I'll say a slight increase in that number for this fiscal year.
The total change was a whopping $550K. Just what are they doing with these "record sales" anyway?

7. Not really a prediction but an observation. PLCB "profit" return to the General Fund will be less than it was in FY2008 - which has been true for every year since then. Just where does all that record sales money go?
Nailed this one too. 8 years of "record sales" and they still haven't matched 2008.

There you have it for another two months, until the "official" numbers come out and I probe a bit more in depth. What this is really telling you is that take away the taxes, the entire PLCB contribution is 3/10ths of 1% of the budget. What it doesn't tell you is that they are a drag on the economy; always have been, always will be.

Fix that. Privatize.

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