This quarter is about 3 things:
(1) SG&A cost reductions-he should be bare bones for headcount and should only have critical discretionary spending (taxes, insurance, minimal travel). No more lease in El Segundo. We'll get to see how much the 2 new US sales guys are making and if Freddy really took a pay cut and is only paying himself $30K a year. As of 2Q he was still taking full pay. He has been selling out of inventory so we'll see how cheap he gave it away to get those contracts. IMO-he'll show a loss at the gross margin level.
(2) A/R collections-is he still pulling the same scam as 2011 and not collecting A/R for cash flow? If he has been as diligent as he says he is, his DSO should be coming down. IMO-he'll show increased A/R (as it should with the sales increase) but DSO will be up because he probably gave them extended payment terms. This is critical because his A/R collections are his only source of cash infusion to make the payroll and prevent more dilution.
(3) Stock dilution-did he issue anymore common stock this quarter to get cash (last report is 720.22M O/S)? He issued 270M in Q1, 289M in 2Q and 98M as of last report (?). He has 1.3B to go. Freddy needs about $2M/qtr cash to keep the wheels on. If he has 90 day terms, he may have collected about $1M in A/R. Assuming he hasn't been running any real production and just selling off inventory, he may be able to squeak it out with the 98M we know of since 2Q report. IMO-Freddy has realized the delicate balance he needs to play here. He has 1.3B more shares but the price will tank so he won't get anything if he goes sub- penny-he'll only get $10M at the most with more dilution. A reverse split will do nothing for him-You only do that when you need price up to get back on Nasdaq. I predict he diluted another 100M exclusive of any preferred stock conversion.
I have my fingers and toes crossed that Freddy surprises us by doing the right things.
FMALONE2013 you are a whackjob. Typical shortee trying to act like you have insight. Using an Irish moniker-you are probably with the Chinese or Indians trying to bash this. Are you really LongDuckDong2013 or Srinivashrahani2013?
Will go back up to $30 next week after ruling.
India can not muck up the works. This deal was in place before 8/1/2013 when the current regulations went into effect that they review it (besides the new reg is that they review it-not that they have authority to void it). The deal will go through at $35 but most likely will be delayed until February 2014. The Unions will puff out their chests and have some back and forth but will lose in the end. Same thing happened with IAM and USW for some defense companies and it was a stay of execution for about 4 months. The deal still went through and the Union got less than what they already had.
Worst case if they break the deal, CTB gets a nice termination fee - $1.75/share.
CERP press releases...
I posted on OMX board-hopefully they don't keep him as an overpaid OMX division president.
OMX-BEST NEWS EVER!
Looks like Ravi wasn't going to get the job so he has bowed out a la Larry Summers...this should skyrocket. Hopefully he's taking his change in control and exiting stage left. Now if they can just get Austrian to retire and bring in fresh blood this post-merger company can give Staples and Amazon a run.
you pump this as being different than CERP but it is identical. PEII about to issue more stock to raise some cash.
OH LORD STAY AWAY! They are another CERP...
Our cash on hand as of June 30, 2013 was $2,098 compared to $17,089 for the period ended December 31, 2012. Company has incurred a net loss of $1,706,634 for the six month period ended June 30, 2013 compared to a net loss of $7,025,145 for the period ended June 30, 2012 and at June 30, 2013 had an accumulated deficit of $21,527,857 as compared to $19,821,223 at December 31, 2012. While the Company has recognized revenues from operations, the revenues generated are not sufficient to sustain operations. The Company does not have sufficient funds to acquire new business assets or maintain its existing operations at this time. Management's plan is to raise equity and/or debt financing as required but there is no certainty that such financing will be available or that it will be available at acceptable terms. The outcome of these matters cannot be predicted at this time.
I am with you on this one Central but at least it's some cash flow. Hopefully Fred can convert this to an ongoing customer after the sample runs out.
Where are those 10 projects he had in the pipeline in the US? Maybe he'll give some color on it at the next 10Q call. Europe has turned into a bust this year.
Speaking for those of us who do have skin in the game and for those that would be looking to get into the game, go away then. You are not helping any of us out. We are more aware and informed about Cereplast than you could ever be. Your simple perusal of Yahoo financial statements and your rudementary analytical abilities to read them do not add any insight. Actually that financial aptitude sounds familiar-are you really Mike Okada the CERP CFO?
CERP (and all these startup or wind down penny stock companies) focus is about cash flow. They only need to make enough to cover the current bills that keep employees working. Payroll, suppliers (A/P), utilities, taxes and eventually interest. Like I said before, to cover the basics he needs about $1M a month and to keep collecting all his A/R.
The 2 loans (unsecured) are already known to be in jeopardy. The original Compass loan $5.4M (15% interest all paid upfront) is worthless (can be converted to 140K shares @ $4.40) and Wells Fargo $12.5M (7% interest which a portion was assumed by IBC) is also worthless (the principal can be converted to 2.2M shares @ $5.80 or at today's share price-the equiv of the O/S shares 833M). The whole derivative liability is the financial magic of the exposure on all these conversions. It is a non-cash item so it is just an accountingism.
Nov 2011 through 2012 vs. today - there was the hope, speculation and opportunity of being huge. Today, they executed that vision and it didn't meet the expectations.
Also they are losing more money today than when they had no sales...can't keep losing $50M/Qtr.
at the end of July, they announced they had 10 projects they were working for N.A. Now it's 30 projects.