Multiple debt covenant breaches on multiple facilities. Confirmation CBA won't waive theirs at least for now.
$15m of debt repayable within 6 months.
Revenue from the ships isn't enough to cover repayments on their debt. Loans "mature at a much faster rate" than their earnings afford.
Confirmation that Troncone got the boot.
No working capital.
Very tepid commentary about the current market - nothing like the enthusiasm shown by @DDMHC ! Confirmation they will be focusing on charter – effectively an admission they can’t make good money from sales themselves. Amusingly, they pitch this admission of failure as a good thing because it will deliver “greater earnings consistency and reliability” LOLOLOL
Confirmation that China is virtually a no-go.
Confirmation that market share in VN and Indo has dropped.
Confirmation that sheep exports to the Middle East are non-existent.
OCF negative. Plus a suggestion of channel stuffing / factoring – “a large portion of the Company’s sales are supported by a combination of advance cash payments”. Just $8m in cash left at year end, and they don’t exactly have a huge balance of receivables they can bring in - $24m v $18m in payables.
EBITDA supposedly positive but only after excluding "one offs"...which keep getting repeated. eg sale of Outback last year - $13m “one off”, impending default on Kelpie contract - $14m “one off”. Even if you strip out depreciation they lost $19m.
Can't afford the Kelpie and will default on the purchase contract unless the vendor gives WLD waivers.
Potentially a poor ability to manage counterparty risk, given the chartering default.
Stupendous amounts being paid to some NEDs / KMP.
I haven’t even gotten to the actual balance sheet or P&L yet.
One other thing while I’m at it. It seems to me highly likely they were indeed meant to report on Friday but simply couldn’t get their act together in time. Printing on the next trading day, without properly proofing their documents (see eg AR p28), stinks of a rush job.
Anyway. Tell me again why this company deserves an MC of >$55m, and an EV of >$180m?
WLD Price at posting:
9.0¢ Sentiment: Sell Disclosure: Not Held
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