giofranchi

+1 I agree 100%! Gio

I agree, but I think they are a bit dated… at least as far as the author’s judgement about Biglari is concerned… If I remember well, the author posted his recent thoughts about Biglari on this thread, saying he no longer think Biglari could be trusted as a good steward of shareholders’ capital. Cheers, Gio

Great! Thank you very much, Tim! :) Gio

Maybe... But I don't have their numbers either... Therefore, I don't know... Though "much better" seems a bit excessive to me! ;) Gio

On the LF 2008 AL we can read: Think of it: in those 9 years, which witnessed the S&P500 being cut in half twice, Biglari still managed to achieve a CAGR of nearly 14%! Isn’t it amazing?... I mean: it is very hard to imagine a more difficult situation for stock market investors than those 9 years… The only thing that comes to mind truly is a new Great Depression scenario!... Yet, The LF delivered a result that would be extremely good under very favorable circumstances too! I think such a result is indeed the final proof you shouldn’t worry too much about what the general market does nor about macro! ;) Just to put that in perspective, Berkshire achieved a CAGR in market value of just 6.2% during the same 9 years… And I don’t know of anyone who did better than The LF. Could some board member point to a money manager with better results during those 9 years? Cheers, Gio

The Lion Fund 2006 AR. Cheers, Gio PS If anyone has the ARs from 2000 to 2005, please post them! It would be greatly appreciated! :) 2006_Lion_Fund_AR.pdf

Thank you! :) Gio

Why? They are both activist investors, run concentrated portfolios, like the same kind of businesses (S n S, Burger King), they both look for securing permanent capital, etc. I can see many similarities. Of course, Biglari is also much more controversial than Ackman… Gio

Not exactly… What about Thomas Cook? What about IKYA? What about ICICI? Etc.? ;) Cheers, Gio

A piece of advice: anyone who has a strong and very well-reasoned criticism towards Biglari is very welcomed, but should stop calling him “Big Liar”… By this time it is just not possible to take seriously a person who keeps calling Biglari that way… It clearly shows he is attacking Biglari the person, because he has no clue how to attack Biglari’s results! If you want to attack his business results, very well! Do all you can to convince me! If I have lost some piece of information along the way, I want to know which! If you think results in the future might go south, very well! Tell me why! I truly want to understand! But, please!, stop calling him “Big Liar”!! ;) Cheers, Gio

Also what I do is to pay more attention to net results than overall results. Companies like GLRE, TPRE, and PSH are very transparent about net results. Gio

Well, if I understand what they are doing, and I am sure I could never replicate it by myself, I usually ask myself: am I paying the right amount, or am I overpaying? In my business I examine offers every day, and I answer that question as follows: if the one I like the best technically, also costs less than the average competition… well then that’s enough for me! Might not be very scientific… But it usually works well and yields satisfactory results in the long run! ;) Can I replicate what BH, PSH, and FIH do? 1) I have no franchise business (and I like franchise businesses very much!), 2) I could never get activist on any investment of mine (but I understand why great results could be achieved that way!), 3) I could never invest in India (yet India has 1.2 billion people, whit a GDP comparable to that of 35 million people in Canada; a very young population on average, instead of poor demographics in developed countries; a very low level of overall debt, instead of high debts in developed countries; and a pro-business government for the first time in 70 years!). Gio

This, I hope, is going be a VERY long term investment for me. Ackman is just 48, and already is a self-made billionaire. He does something I would never be able to replicate myself. And he does it very competently! Moreover, I understand it quite well and like it very much. Biglari is the same for me. He is even younger, and already manages operating businesses too, which give him predictable and meaningful cash flow… but, alas, as you very well know by now, he is more difficult to judge! I will stay invested with both Ackman and Biglari as long as results are more than satisfactory. The day results deteriorate, and the blame is clearly to be put on Ackman and/or Biglari (not on Mr. Market!), I will part ways with them. Period. I hope that day never comes. But, if it does, I am prepared. ;) Cheers, Gio

Thank you! Is there another restaurant chain with 25 consecutive quarters of increased same store sales in the US? Gio

Discipline is not buying above IV... What does that have to do with not buying above NAV?! ;) Cheers, Gio

Then let’s hope GMO and others are dead wrong about the S&P500 future returns! ;) Except that Biglari’s performance has been extremely solid and consistent for 15 years now! As I have said, he might not deserve a rich compensation in the future, if investment results deteriorate (for instance, one exceptional year followed by three mediocre or poor years, like you seem to suggest…), but he surely deserves it now! Simply because he achieves better results than the rest and gets paid less. Except that I don’t care how much capital is under management. All I care about are results. I completely disagree. Gio

Ah! That is a good question! ;) Gio

I think I have also the 2006 AR, but I must check at the office. In case I’ll send you a PM. ;) Cheers, Gio

Well, you surely will get the chance to buy it later closer to NAV, or even below NAV… of course, what nobody can be sure about is how much that NAV would be by then… ;) Cheers, Gio

Yesterday I bought more: 12% of my firm's stock market investments portfolio. Gio

Yes! Of course you are right! By the way, I have just bought more this morning. ;) Cheers, Gio

Truth be told, excluding the rights offering, total investment in 2013 increased 47.9% after all costs. Cheers, Gio

At the end of 2012 BH’s total investments were worth $378.6 million and the return on those investments was 69.1% in 2013. An increase in value of: $378.6 x 0.691 = $261.6 million. Take away those $30 million we paid Biglari, and BH’s shareholders increased their investments by $261.6 - $30 = $231.6 million, which is an increase of $231.6 / $378.6 = 61.17% in 2013. Cheers, Gio

In the 2007 AR of the Lion Fund you can find Biglari’s investment performance since inception. Then on the recently published letter by the independent directors of BH you can find Biglari’s investment performance since 2009. That leaves 2008 out. But, given the large amount of the Lion Fund’s capital invested in S n S, I guess BH’s stock price in 2008 could be a good estimate (-12.1%). Of course, those are out of this world numbers! I repeat: given his 15 years track record, Biglari deserves dual-class shares that put him in full control of BH, and deserves to be paid what he is asking. Things might change in the future… I hope they won’t! ;) Cheers, Gio 2007_Lion_Fund_AR.pdf Biglari_Holdings_Inc._Urges_Shareholders_to_Reject_Groveland_Nominations_to_Board_of_Directors.pdf

What I like most about FIH is its great optionality, because I guess a very large percentage of its capital is still parked in cash (USD). And also the fact India is a place quite insulated from what’s happening to the rest of the world: they have a low level of overall indebtedness, and are experiencing inflation… The exact opposite to what we are seeing in practically all developed economies! This facts, and of course the ability of Watsa & Company to buy great growth at reasonable prices, are the reasons I am quite interested to see what FIH could achieve in the medium and long term. ;) Gio