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Re: raise $1m at the expense of a loss of market value of around $10m

By: tkc in ALEA | Recommend this post (0)
Fri, 15 Mar 13 9:26 PM | 86 view(s)
Boardmark this board | The Trust Matrix 		Msg. 12899 of 54959
(This msg. is a reply to 12895 by Cactus Flower)
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are you mixing together revenue and cash calculations?

Yes but only because they are so cash straped. At the end of Q3 current liabilities exceeded current assets by $5M. Almost all their expenses (sans SBC & depr) require cash, only 5% of rev is COGS - all the rest is payroll, rent and travel which can only be stretched so far. Their current ratio says they've stretched way too much already. The 3.3PP was needed to reduce that gap. Also not all of the rev they've been reporting is new - some continues to come from def rev and long term def rev. That cash (maybe as much as $1.4M last Q) was cash that was spent many Qs ago. I'm only interested in new business that will add new cash that can be used to pay expenses. We'll see soon.


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The above is a reply to the following message:
Re: raise $1m at the expense of a loss of market value of around $10m
By: Cactus Flower in ALEA
Fri, 15 Mar 13 8:30 PM 		Msg. 12895 of 54959

hi tkc,

are you mixing together revenue and cash calculations?

i am assuming $8m of revenue and $10m of cash inflows.

why the discrepancy?

snackman speculated there was a $2m deal at the end of q4 that was unannounced. i have assumed he heard that from a little bird.

but major orders are recognised over the following 12 months. so that drives my original q4 revenue (with no major orders) down by $2m.

they received $3m+ in q4 equity sales. in my calculation, they received an extra $2m in major sales. they appear to have been cutting costs vigorously. that gets them through q4 and part way through q1. on wednesday, they were back to the well and willing to offer a discount and a sweetener, suggesting the money was tight as a drum.

it just about makes sense to me.

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