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Neogen Corp. Message Board

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  • red_wombat80 red_wombat80 Sep 24, 2008 9:14 AM Flag

    Poor cash flow - something fishy about NEOG

    Right - fishy stuff those increases in A/R and Inventories. I mean, revenue increases by 26% and A/R increases by 11% and inventories by less than 8%. That IS scary!

    Let's see... acquisitions made but still no long term debt. They didn't provide a cash flow statement with the release but I believe the company is generating cash but used a little more than generated by operations to make the acquisitions (I think this is the cause for the jump in goodwill, which is higher than the decrease in cash).

    They may have to slow down the acquisitions while they replenish their cash (assuming they don't take on some debt) but this does not imply poor cash flow or poor management. They just took advantage of good opportunities to make some synergistic acquisitions.

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