Bottom line, WC is not only negative (which makes it easier to service on a turnaround - if that's what is happening), but it is also small (in magnitude) relative to revenues. Frankly, it's a non issue - and where it sits today poses no problem in terms of it being serviced by forthcoming revenues.
Agree.
Management have stated explicitly that net payables as of June 2020 were abnormal, and that they have now “returned to normal levels”.
The reduction in net payables that occurred during 1H2021 is what makes the net change in Cash look unimpressive (+12m$), but the corresponding increase in Net Current Asset Value (i.e. Current Assets minus Total non-Lease Liabilities) has been +52.5m$, which gives a much more accurate idea of the underlying FCF generation.
As of December 2020 NCAV (as defined above) was only -16m$ and, once the +14m$ from OSB is factored in, it becomes pretty clear that SKT will soon be both debt free and NCAV positive.
Bottom line, WC is not only negative (which makes it easier to...
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