Sports memento maker Fotoball USA Inc. rejected an overture to buy the company, sparking a nasty exchange between the company's management and some investors.
Disclosure of what Fotoball described as an expression of interest to buy the San Diego-based company at a premium to where its stock now trades came in last week's earnings report, the outfit's second consecutive poor quarter.
"Our clients are certainly disappointed with the performance of the company," said Patrick Myers, a broker with Ferris, Baker Watts.
Myers' brokerage clients control what he described as a substantial amount of Fotoball's shares.
Myers and others blasted management during a conference call last week for the poor financial performance, the rejection of the merger overture, and bonuses paid to top executives.
"This [earnings] press release just blows me away and convinces me that without a shadow of doubt the board has very little regard for the shareholders of the company," Myers' colleague Jack Leonard said on the conference call.
Revenue for the company in the first six months of 2003 has fallen 34 percent, to $16.4 million, while the company lost nearly $300,000 during that period, compared with a $1 million profit in the year-ago period. Since the start of the year, Fotoball stock has dropped 19 percent to $3.18, the price it was trading at last Thursday.
Company Chief Executive Michael Favish on the call blamed the results on poor performance in its non-sports businesses and the weak economy.
