In the latest quarter, the company reduced total indebtedness from $6278k to $4197k. I would guess some of the repayments were discretionary. That’s interesting, because the company’s guidance of only 50000 pearls sold in Q3 won’t be sufficient to cover total costs in the quarter - meaning it will have to run down cash holdings to cover the shortfall. Cautious management of cash would normally dictate building up cash reserves to insure against unexpected events, rather than making discretionary debt repayments. If this is correct, it suggests that the management is confident of a strong Q4 cash inflow, so that cash reserves can be replenished. In other words, they think that the improvement in trading in Q2 (reflecting a recovery in pearl grades etc) will be sustained. That’s how I read the Q2 results too.
ATP Price at posting:
2.3¢ Sentiment: Buy Disclosure: Held
A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.
(20min delay)