Agreed, not diluting is a very beneficial for us. The expansion is being payed for by bot existing cash flow and existing debt equity means. Depending on the break down, if a large portion comes from cash flows then this could have a one time throtle back on net earnings. If this does occur, hopefully it will be clearly pointed out by management as a 1-time cost. The inteligent investors will be looking deeper into the Q-to-Q increases of operating earnings ane realize that we have an incredibly good picture here. Especially without the effects of dilution.
Since this is a cpaital investment the expenses are depreciated over time. It does not matter what the funding mechanism is; the cost is allocated over time against revenue. The use of internal cash and credit lines affect the cash flow but not the earnings. Issuing more stock would result in equivalent earnings (less interest expenses) but distributed over a larger number of shares. It would also improve cash flow. If the company has sufficient cash and credit lines this is by far the best way to go.
I knew that there was something wrong with my analysis (a while since I studied accounting). As usual, the balance sheet and income statement is clear until the mysteries of cash flow muddy the picture ;-)
That said- management's choice for expansion is the best possible avanue for the current investors. Many thanks to Mr. Wertz (CFO), Rosenberg (CEO), Soong (COB) and Liu (master of the Far East).