$1billion loss due to impairment, im not sure if you are aware how impairments work.. Next year their assets could generate more cash, and instead could add to NPAT. Impairments are a non-cash cost.
Another way of thinking about it is the fact that 100milion shares were issued at $6 bucks. 600milion overpaid.. Hence those who purchased in the capital raising forfeited their money. Shareholders purchasing in at $0.50 to $1 are much better off..
You talk about a going concern yet if you bring up the income and asset statement you will see that:
Receivables: 632mil
WIP: 429mil
Cash at Bank: 52mil
Other non-current assets: 20mil
Meaning that SGH will have 1.133bilion (excluding tax credits) in short term assets (which are easily converted to cash).
The total current liabilities: 664mil
Leaving SGH with: 550mil in cash flows in the next 12 months
Long term liabilities:
The biggest risk at the moment is debt. With 789mil.. I was expecting this ammount to reduce, it did however increase. Nonetheless, SGH weren't kidding when they said that 2HY is heavily skewed with cashflows.
SGH Price at posting:
58.0¢ Sentiment: Hold Disclosure: Held
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