Email I just sent to IR, will re-post if they answer
I am a longer-term ENZN stockholder now trying to understand the meaning of yesterday’s announcement, in terms of a stream of likely future dividend payments – ie. how much and when.
Reviewing the company financials, there is one thing I do not understand (because, alas, I am no accountant). I see there is ~ 200m in cash and similar assets. There is also mention of ~ 116m in “convertible 4% notes”. Are the latter a liability? If so that might mean that NET assets are only roughly 200 – 116 = 84m. If so, then the announced 70m special dividend payment would leave only 14m for company purposes. Have I understood this aright?
The other matter for which I need clarification is: how many years of revenues at almost $1 per share (ie 41.5m of revenue and about 44m shares) can we expect?
I am totally at a loss as to why the stock (ENZN) has FALLEN to about 3.40 (it opened today at 4.01).
Upon reviewing this email, it may come across as confused: again, I am just trying to understand the stream of payments a stockholder can reasonably expect in future, and hence the value of a unit of ENZN. It seems one should be able to calculate it fairly precisely in your present circumstances. The stock seems a screaming buy at 3.40, but I want to make sure I have not misunderstood something major!
The $116 million in convertible notes is right on the key statistics page. It is Total Debt, which is also on the balance sheet as Short/Current Long Term Debt if you are looking there - this is a liability.
You can go to the SEC website and pull up the 424B7 document from June 2007 and prior to see the details. The notes mature one June 1 this year and so the $116 million is necessary now to pay them off. They are convertible, but since the conversion price is $9.55/share, it is a safe bet that none of the note holders will want to convert.
the company repurchased over 10m shares, that's why the float is as low as it is, there is the additional question as to why a dividend is being paid to shares that are in the company's possession? $70m/44m=$1.60! $70m/30m=$2.10, ahhhh, could that explain the $.45 drop, quick, get the license plate of that truck at the back door!