Share
3,555 Posts.
lightbulb Created with Sketch. 374
clock Created with Sketch.
09/07/18
14:37
Share
Originally posted by MarsC
↑
So you did strip out goodwill. My apologies.
Looking at the latest accounts (HY Dec 17) there are a total of about $146m in inventories and receivables. But remember, there is a reason the business is earning such a low return on its NTA's. Selling inventory into an industry that is over supplied and in structural decline is difficult under normal circumstances. It is doubly difficult in a liquidation.
For instance, if receivables & inventories achieve 80% realisation rates, then NTA's reduce by close to 30% to about $77m. Then there are over $30m in operating lease obligations (which are not shown on the balance sheet).
Then there is the fact that in a liquidation new expenses (which are not shown anywhere in the accounts) can be expected to pop up - such as staff retrenchment costs etc.
So my point remains.
Expand
Interesting thanks MarsC