Long article on BUD woes in WE AUST business today.
I could post it; here’s an extract:
’….But there was more. Unrelated to the accounting error, things had soured on the production front also. Buddy revealed that it had been notified by the company’s manufacturers in China “that an entire production run’s allocation’’ of a critical semiconductor component for its smart lights had been sold to a third party without the company’s knowledge.
“This component, and LED driver chip, is found in every one of the LIFX products and is currently in significantly high demand across the manufacturing landscape ranging from consumer electronics to automotive.’’ Buddy said that as a result, “the company’s manufacturing activities have ceased until further notice’’….’
…..This pushed the company into a negative total equity position, however Buddy said the directors still considered that it would be able to continue as a going concern because its ongoing restructuring plan was delivering better margins and “significantly improved EBITDA”, and the company’s historic track record of being able to raise funds “as and when required’’.
The company’s half-year financials, also released last week, reported revenues of $13.7m, down 20.4 per cent, an EBITDA loss of $1m and net operating cash outflows of $1.1m.
The company also had net current liabilities of $7.04m.
Buddy told The Weekend Australian that it had no plans to raise capital at this time, but “in the future we believe Buddy can achieve profitability. In the meantime, we’re focused on reaching consistent positive monthly EBITDA and positive monthly cashflow.’’ Buddy’s shares closed at 0.7c, valuing the company at a fraction of what it was a year or so ago. But for now, the lights are still on.’
