Noticed it as a holding of GRX, a Closed end fund that I have a position in.
Mostly Q 4 (Dec. 31) numbers, giving some consideration to the recent offering which raised some desperately needed immediate Cash.
Q 4 revenue...................$254 million
Gross profit.......................65.6 million
Here's the 2 things that really bother me and that are making profitability hard to achieve........
SG&A expenses..........$64.3 million
Interest expense.............9.3 million
**Add just these 2 expenses together ($73.6 million) and subtract them from the Gross Profit of $65.6 million and BIOS is already at an approx $8 million 1/4ly loss. They need to cut SG&A (hard to cut the interest expense) if they want any chance of achieving profitability anytime soon.
Might be cash flow positive, which is good, but investors look at profit, not cash flow (perhaps unwisely)...
Balance sheet.............Debt of $418 million is daunting. If they can grow and control other expenses, they may be able to "grow their way" out of the debt problem.
Accounts payable grew $27 million the last 3 months of 2014, which probably exacerbated the need for the March offering.
Goodwill of $573 million.........could be a huge write off (non cash) coming here someday. They've obviously made some big or numerous acquisitions to have built up such a large number in this area.
If the acquisitions aren't contributing profits (at some point)........current accounting law requires an accelerated write off of Goodwill. Not a horrible thing as it would be non-cash, but it looks ugly and sets a bad precedent.
Just my honest observations as a non holder........................Kel
Bought a slug of PSEC @ 8.31, near multi month lows and over $2 below its Dec. 31st NAV of $10.35.
They report EPS on May 6, next Wed., after the close with the CC @ 11:00 AM Eastern the next morning.
Sold UGAZ (3 X long natgas ETF)...made 31% in 3 days.
Cleaned out of CHK after a 2 day rally.....all profits.
Starting to feel like Slickster.
Problem.....now very loaded with cash and can't find anything to buy.....looking at....
CVX and / or COP....
more shares of TICC.......
dsouth........I've held a core (non IRA) position in FEI since Jan. 2013, soon after it's IPO. Very happy to just collect the monthly distributions.
At one time (last fall approx) I also held NML, CEN, and FPL, all at the same time. Decided to lighten up in that area and just stick with FEI, the monthly payer with the nice rising dist record.
I've received paper reports from all these CEFs and have scrutinized them so I understand the accounting methods used in these entities.
I only have one year of post high school Accounting and that was tech school back in 1971-72. I have made great efforts over the years to expand (on my own) my accounting knowledge. It has served me well in all areas of investing.
A low PE Ratio..........the price they pay for having one incredibly effective drug and a few much smaller, mediocre ones.
Thanks to hedges for about 2/3's of the distribution. All hedges end at the end of 2015 calendar year. Enjoy them for a few more quarters unless pricing improves significantly.
Kel............just an observer
Now up about $3.00, but is bouncing around.
***declares initial div of 43 cents.....x -div June 12, pays June 29..
**Quarterly sales of $7.6 billion vs year ago of $5.0 billion (+52%)
**EPS (GAAP) of $2.76 vs year ago $1.33 (+107%).....non GAAP $2.94 vs $1.48
Cash of $14.5 billion.......debt of $13.3 billion
Still holding my position. Cost of 73.13 on 3-26-14.
Did well today with some UGAZ I bought on Tuesday @ 1.81. Still holding as NG may have more rally left in it, for now anyway. Day to day holding.
Sold some CHK today @ 15.75......cost 15.11 on April 21. Had to suffer with that for several days.
Keep those PSEC guys on their toes over there-:)
Another interesting thing is the Deferred income tax liability. It's on the balance sheet under the LIABILITIES heading, 2nd item. Shows an amount of $156,221,316.
This is POTENTIAL taxes on gains that would be owed if the portfolio was liquidated as their gains on 10-31-14 were about $403 million (top of ASSETS classification).
It is hard to predict the EPS and the reaction. Both CELG and GILD have a big part of their revenues coming from one drug. They both need a more diversified product mix. Probably the main reason for the modest PE Ratios.
This is complicated, so I hope you are really a CPA. I have the paper copy of the Oct. 31, 2014 report so I hope the page numbers match.
Page 14 of the CASH FLOW STATEMENT....6th item from the top.....shows a $ amount of $47,411,834 with the line named "RETURN OF CAPITAL RECEIVED FROM INVESTMENT IN MLPs."
Now on page 19 under Note F...near the end of the 3rd paragraph......quote...."For the year ended Oct. 31, 2014, distributions of $47,957,182 received from MLPS have been reclassified as a return of capital." That's why the "Investment income" numbers (page 12) are so much smaller than you'd expect them to be.
The $$ come from the MLPs and flows through to the distribution and is then classified on your (mine) as ROC. My dists were about 2/3s ROC.
If the ROC was destructive (return of your invested $$) it would show up in a deterioration of the NAV. FEI has grown its NAV over the last 2 years.
I like that FEI (and FPL....sibling of FEI) writes call options on up to 35% of their portfolios. Adds a little stability when MLPs are fluctuating, especially downward. The fund cites the buy / write strategy as a form of "insurance" for the approx 25% leverage.
FEI has also raised their distribution 4 times in the last 2 years.
Sept. 2013.....from .10875 to .1100
March 2014.......up to .1117
Jan. 2015..........up to .1134
April 2015..........up to .1150.....small raises, but they add up over time.
CEN still @ .1042. Not sure, but I don't think they've ever raised.