Its not possible to directly associate the amt of feed to...

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Timber7

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01/08/19

07:49

Post #: 39800912
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Originally posted by fyffee: ↑

From the 4C report released today, over the full year, we have used $9,585,000 in cash in operating activities, but that includes expenses of $21,317,000 on feed costs to grow more biomass ahead of sales and production. Without that cost, we could have generated $11,732,000 in net positive cash, which is a net positive cash margin of $4,348/tonne. In order to sustain that sort of investment in biomass growth without going cash negative, we would have to be producing and selling around 4,900 tonnes of fish per year. That is probably at least two years away yet. I just wonder how much longer we can continue to grow the biomass in excess of sales at the current rate.

It seems that management is winding back the rate of biomass growth and expenses on feed for the current quarter - from around $9m in the last quarter to $4.0m in the current quarter - or is that just a seasonal issue? With a further growth in sales and revenue in the current quarter above $12,670,000 and anticipated cash outflows of $13,650,000, including a reduced expense on feed for biomass growth, we could well be cash flow neutral in this current quarter. Last year the growth in sales revenue from June qtr of 2017/18 to Sept qtr of 2018/19 was 2.1% - from $9,998k to $10,208k. Can we achieve a 7.7% increase in sales and revenue in this quarter from the last quarter?

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Its not possible to directly associate the amt of feed to biomass fyffee but you are on the right track. In general, feed as a cost is increasing. This qtrly was horrendous in terms of impact on accounts. They cant continue to trade like this without a cash injection. The SP is going to get hammered.

The next qtr looks like it will be a good one avoiding another draw down on finance. The upcoming roadshow looks and feels like a play for another a capital injection. Its particularly disappointing that the narrative is now "2025" which again seems to indicate a long investment horizon before any form of SH return can be realised.

CSS Price at posting: 90.0¢ Sentiment: Sell Disclosure: Not Held
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3 Great analysis

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Its not possible to directly associate the amt of feed to...

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