Generally positive sales results, all appear headed in the right direction. Question is what prices are they getting for this increase in growth and what are their input costs relative to the revenue. I hope they are covering their growth and opex costs without digging into their reserves. If so we may see the market cap shift, it would appear as if there has been some stabilising/upward momentum of late. This coming quarterly will be revealing and perhaps a time to consider entering or averaging down if its positive.
I had previously thought that there wont be CR's due to the low market cap and the large ownership of directors/sophs (80%?) who would have invested at higher prices and won't want dilution. They also have $2m in reserves and a further $1m credit facility, and the recent $1.6m convertible note to directors (20%) and sophisticated investors, at a conversion rate of min 1.9c to a max of 5c, within three years - paying 10.5% interest per annum.
Happy to get your thoughts - worst case this could be a value trap, best case we see rapid reevaluation based on expanding sales and low unit costs of production/ reduced opex, assuming the market genuinely continues to move to these sustainable products and that their offerings expand to more than doggie bags.
Its been a long journey and to date has only resulted in capital erosion. Fingers crossed.
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