cash burn 4c. land sale.

Cash Burn.

April Burn $210K
10 Moths Cash Burn $2,111K average $211K
Receipts April $132K 10 Mth Ave $2,642 average $264K
Receipts (Sales) in April down 50% .

Cash At end of Month.
($727) Overdraft 750K Balance Plus $23K.
Plus Placement May $428K Total $451k Cash burn Average $211K or 2.13 Months.

Other Factors.
Land Sale App $2.200K Less Overdraft $1,450K or 6.8 Mths considering cash burn.
Inventory & Receivables $950K
Bank Guarantees Provided to third parties $335K
Overdraft $750K.
7.1 Mil Gov grant repayment?
Rights issue plus placement App. $2.950K. ???

I am not an accountant but clearly we need to get the sales up or find another asset to sell.


Land Sale Comments.

Announcement Dated 30 January.
“Entered into a contract” Share Holder Approval???
$3 Mil plus GST Settlement TBA
“Lease back of 26,000 Sq Metres”

Announcement Dated 24 March.
$3Mil plus GST Settlement “will occur on Friday 17 April 2009”


Announcement Dated 30April. Appendix 4C.
$3Mil plus GST settlement “expected to be Approximately 7 May”

Announcement Dated 14 May.
“subject to ARW and the purchaser entering into a formal lease”
“Settlement of the land sale has been delayed until such discussions have been finalised”
Lease the land that the plant is located on plus an option to lease a further 10,000 Sq Metres.

Announcement Dated 29 May. Appendix 4C.
“The company will retain control of the land occupied by the existing plant, which will mean a pro-rata payment of the land resulting in cash of approximately $2.2Mil for the company.” “Settlement date to be approximately early June 2009.”
“will retain control of the land occupied by the existing plant.”


Comment.
• Purchaser maybe was not keen to own the land due to ARW financials?
• ARW retains the land and therefore no rent etc.
• ARW no longer has an option for an additional 10,000 Sq Metres.
• These critical details are in Appendix 4C not a separate announcement.
• As the word “Approximately” $2.2 Mil maybe negotiations are still not completed?
• Is a Subdivision required?
• ARW land value App 800K is assume the bank would lend on this amount.

Please do your own research.