I admire the way this company sees the world - very glass half full. Somewhat like the Little Engine that could going up a hill with the song "I think I can" coming out his spout.
BUT
this is what I see:
Debt increased from $10.4 million to $15.2 million, interest cost will increase by 50% YoY
Sale of a property by expression of interest has failed to sell and the market for any real estate is not good. Unlikely to realise the value of that asset
Revenue flat, expenses up and a widening loss
Inventory doubled, so is the stuff they are making actually selling?
Given the projected cash outflow for Jan - Mar quarter is $6.5 million ($4.5 in production, plus $2.0 for opex), this means that they will potentially run out of cash in early May; if they sell Ignatios Farm, that will stretch it out until August, but this property could be the subject of a rushed sale.
Given the poor rainfall lately, milk production is down for producers
The headwinds for this company are get stronger and stronger. They have a strategy - executing it before the money well dries up is problematic.
I rate them as the Little Engine that may not get there.
AHF Price at posting:
13.5¢ Sentiment: Sell Disclosure: Not Held
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