• Gross profit of $69 million, compared to losses in 2014 and 2013
• Net loss of $187.4 million following non-cash charge of $137.2 million for the impairment of excess reorganization value
• Positive cash flow from operations increases year-end cash balance to $234 million “
Non-cash charge is only 137 million, why did they have 187.4 million net loss? They stated the gross profit of 69 million, and positive cash flow.
Thanks for the explanation. This helps!
IPI debt now is $150M, is not so big considering its revenue and cash. If the lender is reasonable, they should reach an agreement. Lot of small oil companies have few millions of cash but billions of debt now, I can list many of them and they are still trading above a dollar.
1. “Average net realized sales price per ton in the fourth quarter was $277, a 20% decrease year over year, and was $339 for 2015, up slightly from full-year 2014.”
That means potash price has not tanked much, at least much better than oil and natural gas. From this point of view, the environment is not too bad for any potash companies. In 2014, IPI was a $14 stock.
2. “The company sold 89,000 tons of potash in the fourth quarter for a full-year total of 587,000 tons, which is down 36% from 2014”
Why has this number been down so much? IPI lost market share? This does not make senses. Typically for most commodity companies, their output is stable year over year, unless they run of mines.
3. “The company had a net loss of $0.26 per share on $42.8 million in revenue, versus consensus estimates from Thomson Reuters of a net loss of $0.11 per share on revenue of $61.67 million.”
Why did they miss revenue so much? Again, this was because they sold much less tons of potash. Why?
4. Insiders bought lot of shares at the end of 2015, at the price of few dollars. Why? The stock purchases were fairly recent. Those executives could not see that they were selling much less tons of potash?
5. According to the conference call, they still have $63.6 million cash in hand, they have also reduced expenses a lot. Bankruptcy does seem an imminent concern, but why is the stock trading like a bankruptcy stock?
Looks like IPI is a good gamble play. If it does not go bankruptcy(they still have lot of cash for a small company), oil price is up, other commodity prices are up, probably potash price will be up as well. We should see IPI to few dollars by the year end.