The numbers are quite weak actually, income from operations was down more than 80% compared to Q3. Gross margins were down, while sales and marketing expenses were up significantly.
More than 80% of the company's revenues are still derived from its brokerage business.
The company is changing its entire business model with the potential success unclear at this point. Guidance looks too optimistic. Assuming improvements in H2 looks pretty far fetched at this point.
Cash is up $53 mln from Q3, but cash flow profited from a $14 mln increase in accounts payable qoq. Accounts receivable was also down by $20 mln qoq but some of that amount was due to even more bad debt provisions.
So they got the Nation Sky payment and some additional help from working capital but still the increase in cash was lower than the Nation Sky purchase price...
Obviously you haven't passed that test.
The press release warns of liquidity constraints due to the MGF dispute so they have obviously tripped the Sycamore debt covenants already with Sycamore being able to accelerate the debt now.
Nobody would pay $150 mln plus $200 mln to shareholders in exchange for $100 mln in annual losses. The company lost more than $85 mln in cash last year.
This is an easy bet and Mr. Market is well aware of the situation given the share price in after hours. Smart move by Sycamore.
You don't get it. Sycamore is the company's sole long-term creditor. With the help of fully controlled MGF Sourcing they now created a situation for ARO to default on the credit line provided by Sycamore two years ago. ARO will have to file for bankruptcy and Sycamore will get the company without paying shareholders anything.
No. They are going to default on the Sycamore term loan actually and will have to file for bankruptcy. Nobody is paying cash for a company losing $100 mln + each year. Sycamore will take control then as they are the only major debtholder.
They actually paid quarterly dividends of $0.06 on roughly 53 mln shares before the SNB event, this amounted to just $12.7 mln in annual dividend payments.
Since the SNB event the company's revenues have come down by more than 35% and EBITDA has been a fraction of previous levels. Cash has consistently went down over the course of the year albeit just slightly. The proceeds of the asset sales went to partial repayments of the loan but of course they also had to pay the brutal interest obligations in the meantime.
They don't need to offer anything. Either they sell FXCM in 2018 or beyond and pocket the money or they also seize the rest of the company then should FXCM still have not paid back the loan.
The convert is still trading at 60% of face value currently, I can't believe it.
That's right. But the shares were already worthless even before today's further 50% seizure of the remaining operating business by Leukadia as the convertible bonds at the exchange listed company level will also mature in 2018 and there's no way to pay them back...
Great deal. FXCM shareholders are losing another 50% of their remaining ownership in the company in exchange for a one-year maturity extension and the allowance of making interest payments in kind (which will further dilute outside equityholders).
So even if the remaining business should miraculously thrive again two years from now, the upside for the outside shareholders has just been capped by another 50%...
Even worse the company's remaining assets obviously did not attract bids that would have allowed FXCM to repay the remaining $197 mln to Leukadia. Subtracting the amount owed to Leukadia the company's cash position is just $10 mln, but this does not yet account for the $155 mln in convertible notes at the FXCM Holding Co. level.
Should the business be sold in 2018, the exchange listed Holding Company will simply file for bankruptcy given that they won't be able to pay back the convertible notes then.
Some revenue upside but ongoing margin weakness and another decrease in the E-commerce growth to just 15% yoy. Stock would be up otherwise but the lousy e-commerce number will take its toll
You are missing the greater picture - go back to my previous postings were I explained the issues with this transaction.
They bought this business for $45 mln only eighteen months ago and will have to record a $20 mln loss on this sale.
Vaultlogix was their only high margin business at 80% gross margins and contributed positive cash flows to the company. The remaining business will show gross margins below 20% and lose even more cash than already before.
Roughly half of the sales proceeds will have to be transferred to the secured senior term loan lenders immediately.
The remaining sales proceeds are not enough to cover the company's upcoming H1/2016 debt maturities so there's a very real chance for more financial engineering pretty soon. Expect more equity sales, highly dilutive debt conversions or related party financings at brutal interest rates going forward.
They will simply cure this by doing a reverse stock split.
No, they actually sold their only still somewhat valuable asset at a 45% loss. Accordingly Intercloud's cash losses will increase materially going forward given the removal of the 80% gross margin backup business. The company will only get roughly half of the purchase price as the rest will be due to pay back an associated term loan. Unfortunately the company's upcoming H1/2016 debt maturities are almost double the level of the remaining purchase price.
The shares have already traded their average daily volume. Still hoping for an explosion in order to get short at the end of the day. This company is like printing money.