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Alliance Resource Partners LP Message Board

goforbroke_1999 11 posts  |  Last Activity: Dec 12, 2014 10:49 AM Member since: Feb 28, 2000
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  • goforbroke_1999 by goforbroke_1999 Dec 12, 2014 10:49 AM Flag

    Can someone help me out on this - there used to be some guy on the board that claimed that PLUG lost money on every unit that they sold - most of the posters "shouted him down" and I haven't seen him on here recently.

    But when I look at their September results versus June, their sales went up by $2.56MM and their costs went up by $3.85MM - so, it looks like they in fact did lose money on every unit they sold. Shouldn't their cost of goods sold be declining if their direct costs to produce a unit were greater than their sale price, particularly since their volume went up? It seems like the higher volume would have helped to overcome their overhead costs (heat, depreciation, management, etc) if they had positive direct contribution. Did something unusual happen in this quarter that impacted their manufacturing costs?

    Also, if the forklift opportunity is so big, why are they chasing other opportunities before they achieve profitability? I realize that diversification of their revenue is good, but they are just scratching the surface of the forklift opportunity - shouldn't their focus be on becoming profitable and proving that they can make money in that market before they spend money expanding into others?

  • Reply to

    Is the Rumor true

    by pluginaire Nov 26, 2014 1:04 PM
    goforbroke_1999 goforbroke_1999 Nov 26, 2014 4:01 PM Flag

    According to their SEC filings, Andy is only 58 years old - why would he leave now?

  • Reply to

    ANAD FEIC in Huawei's Ascend Mate 7

    by logicarus Nov 24, 2014 10:12 AM
    goforbroke_1999 goforbroke_1999 Nov 24, 2014 10:31 PM Flag

    Does anyone know what share of the business they were awarded by Huawei? They rarely give it all to one supplier. Could be meaningful if they got the lion's share for this part.

  • Reply to

    Liquidity is not an issue at the present time.

    by fdv54320 Nov 20, 2014 3:50 PM
    goforbroke_1999 goforbroke_1999 Nov 21, 2014 9:02 PM Flag

    OK - thanks - knowing the EBITDA number this quarter is above what they needed for next quarter is a real plus in terms of not violating the loan covenants. It is also positive that they are guiding to higher revenue as most of the semi stocks guided to flat or declining revenue for the December quarter.

  • Reply to

    Liquidity is not an issue at the present time.

    by fdv54320 Nov 20, 2014 3:50 PM
    goforbroke_1999 goforbroke_1999 Nov 21, 2014 4:36 PM Flag

    Another question - I wasn't sure how to calculate EBITDA - do you know how close they were to the negative $4.25MM EBITDA covenant for their results of September 30, 2014? The only reason it might be relevant is that their covenant for the end of December is a negative $3.5MM and it would be nice to know what their EBITDA was (under the bank covenant terms of EBITDA) last quarter to see how much they need to improve to not trip the covenant.

  • Reply to

    Liquidity is not an issue at the present time.

    by fdv54320 Nov 20, 2014 3:50 PM
    goforbroke_1999 goforbroke_1999 Nov 21, 2014 4:32 PM Flag

    Since they closed on the SVB facility in October, I think you are right that the $4MM was from another bank - however, since they can't print cash, they either had to use $4MM of their cash to pay off the other loan or draw down $4MM on their new line with SVB to payoff the loan - either way, they don't appear to me to have quite as much spare liquidity as you are stating in the $10MM line with SVB. Am I missing something?

  • Reply to

    Liquidity is not an issue at the present time.

    by fdv54320 Nov 20, 2014 3:50 PM
    goforbroke_1999 goforbroke_1999 Nov 21, 2014 1:05 PM Flag

    Well, you are certainly more knowledgeable about this than I am. But I took your advice and did a little more research and was curious as to your thoughts as to what this all means.

    In their 8K filing about the new loan with SVB, it states:

    “Availability Amount” is (a) the lesser of (i) the Revolving Line or (ii) the amount available under the Borrowing Base minus (b) the outstanding principal balance of any Advances

    And then later it defines the "borrowing base" as:

    “Borrowing Base” is eighty-five percent (85%) of Eligible Accounts, as determined by Bank from Borrower’s most recent Transaction Report; provided, however, that, upon prior or contemporaneous notice to and in good faith consultation with Borrower, Bank has the right to decrease the foregoing percentage in its good faith business judgment to mitigate the impact of events, conditions, contingencies, or risks which may adversely affect the Collateral or its value."

    So, regarding the $10MM line, and using the above, I get their "borrowing base" for this quarter as 85% of their outstanding accounts receivable as of the end of last quarter ($9,459M), or $8.04MM, less their outstanding indebtedness of $4MM to get to their "Availability Amount" of $4.04MM under the SVB line.

    What I could use some guidance on from you is whether they have $10MM or $4MM left under their SVB line?

  • Reply to

    Holy cow; did you see the rally for ANAD?

    by zudozebotyma Nov 20, 2014 10:04 AM
    goforbroke_1999 goforbroke_1999 Nov 20, 2014 12:35 PM Flag

    I think that they have announced that as a result of their merger with RFMD, that they will be closing the Oregon facility. They recently made some pretty significant investments in their Texas facility to modernize it and increase its capacity. RFMD has a very large fab in North Carolina, and to my knowledge, no one has given any indication as to whether this fab will be merged into Texas or will survive as a stand alone plant. Given that semi-conductors continue to shrink in size, they have plenty of capacity available, so I would not consider them as being interested in any of ANAD's capacity unless they had something "special" that didn't exist at either their Texas or North Carolina fabs.

  • Reply to

    Holy cow; did you see the rally for ANAD?

    by zudozebotyma Nov 20, 2014 10:04 AM
    goforbroke_1999 goforbroke_1999 Nov 20, 2014 10:45 AM Flag

    Does anyone know how modern their semi-conductor manufacturing capacity is? I doubt that TQNT/RFMD need any more capacity, but at their current price, they have to be the cheapest incremental capacity available. Does anyone think that they might be a takeover target for either a domestic producer who is short on capacity or an international player who wants to get a foothold in the U.S.?

  • Reply to

    Cash

    by goforbroke_1999 Nov 18, 2014 5:43 PM
    goforbroke_1999 goforbroke_1999 Nov 20, 2014 8:26 AM Flag

    Actually, most of the cash for the quarter came from a reduction in working capital, primarily inventories. This is kind of a "one time event", and while they can continue to reduce their bloated inventories, one has to believe that some of the excess inventory existed because they built the wrong products. I did go back and relook at my analysis, and I still say that they are seriously running out of cash. Assuming that they cannot continue to reduce inventory by $4 to $5MM each quarter (at least not for this upcoming quarter), then I would expect them to lose betwen $5 and $6MM in cash with the quarter ending in December, which may lead to a "going concern" statement by their auditors in their 2014 10K. They may be able to raise some cash through a stock offering, but at the current price, it would be terribly dilutive to existing shareholders.

  • goforbroke_1999 by goforbroke_1999 Nov 18, 2014 5:43 PM Flag

    Am I missing something? They seem to blow through about $7MM in cash per quarter and their guidance for next quarter is about the same as this quarter in terms of revenue, margins and cost. They have $7MM in current debt and around $17MM in cash. So, if they continue to spend cash at this rate, and also assuming that the bank is not going to let their cash fall below their indebtedness, where do they get the money to continue to operate two quarters out? Will they do a stock offering?

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