What are the negatives?, page-6

Lulelee, big thankyou for your input. I have explored the cash flow risk and the following are my observations:

• TFC transparently identifies its cash and non cash revenue; and its cash EBITDA (see page 9 of https://www.belldirect.com.au/file.type?src=lEih7mNYKULRcKtR51y9KL%2bsAVd5ff5E This suggests TFC believes it does not need to hide the cash generation part of its business.
• TFC’s cash revenue has increased from $18.4 (1H FY13) to $60.7m (1H FY16). A compound growth rate of around 50%. Similarly cash EBITDA has increased from a loss of $11.1m (1H FY13) to a surplus of $8.6m (1H FY16). A clear trend of increasing cash EBITDA.
• TFC states its “cash inflows from plantation sales are heavily weighted to H2” (page 15).
• The CEO stated “The 2016 harvest will commence in May 2016 and is expected to deliver more than 300 tonnes of heartwood – a tenfold increase on last year. Our harvested yield will be sold to our diverse global customers and generate attractive cash margins which will transform our financial performance” (my emphasis)

Consequently, I am not concerned with the cash flow risk. I believe it is one of its great positives because it is about to commence receiving large cash inflows.
[Please note, I am not ‘debating’ with you. I am writing this post to force me to consider the risk and justify my conclusion]