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AXION INTL HLDGS INC Message Board

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  • mikebert mikebert Jun 11, 1999 10:45 PM Flag

    Larger float

    ANLT has negative cash flow because is has large
    DSO (i.e. large unbilled revenues) and because it has
    large A/R. When I refer to the "cash flow problem" I am
    referring to all of these.

    Now this sort of
    fluctuation in cash flow is a normal part of business--see my
    cash flow
    model:

    http://members.tripod.com/~Mikebert/ANLT_CF.html

    But, ANLT management called attention to it when they
    announced they were going to issue a secondary, and
    mentioned one of the things they wanted to do was *pay down
    debt* The question arises, why a secondary now, and
    not, say, in 1997, when cash flow was strong? Could it
    be they are in trouble and are going to need the
    money (i.e. cash flow will be negative for a long time
    and they worry about getting additional
    loans)?

    Thanks to Nomadic and TLWatson for completing this last
    piece of the short puzzle in my mind.

 
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