This evening The Green Organic Dutchman (TSE: TGOD) released quarterly earnings and they weren’t much of a surprise. The company burned through an additional $47M in operating and investing cashflow and saw a large increase in their payables.
We broke down the quarter-over-quarter numbers here:
|Revenue||$ 2.62||$ 2.90||-9.7%|
|Gross Profit (pre-bio)||$ 1.59||$ 1.95||-18.5%|
|Bio Adjustements||$ 0.12||$ 0.01|
|Gross Profit (post-bio)||$ 1.70||$ 1.96||-13.3%|
|Operating Expenses||$ 21.51||$ 18.37||17.1%|
|Net Loss||$ 21.07||$ 16.44||28.2%|
|Operating Cash Flow||$ 9.52||$ (24.53)|
|Investing Cash Flow||$ (56.89)||$ (83.67)||-32.0%|
|Cash||$ 22.94||$ 68.72||-66.6%|
|Receivables||$ 14.20||$ 16.59||-14.4%|
|Payables||$ 66.62||$ 31.53||111.3%|
The company’s news release issued with the earnings looked like management has lost it’s ability to make the picture look rosy, with no mention of top line sales and mostly comments attributing to the build out of facilities that are already behind schedule.
Interestingly, the company managed to have declining revenues from their $18.6M HempPoland acquisition, which made up the majority of the $2.6M top line. Also, the company notes in the unsearchable MD&A, they currently do not meet the standard’s to uplist to the NASDAQ.
These earnings came on the heels of a news release that TGOD has lined up $103M in funding, which mostly consists of non-binding term sheets. Also, in the financing news release, there was a lack of terms surrounding the convertible prices.
In summary, TGOD burned more cash this quarter and they are starting to run low on funds. They might have some more cash coming in, but at unknown dilution levels, which will complete the build-out of facilities for an already oversupplied market.
Fingers crossed on those term sheets. I still think Valleyfield will make a great abandoned building for skateboarders in 2 years.
Hey, pot stocks!
Information for this analysis was found via Sedar and The Green Organic Dutchman. The author has no securities or affiliations related to the organizations explicitly mentioned. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security.
SmallCapSteve started blogging in the Winter of 2009. During that time, he was able to spot many take over candidates and pick a variety of stocks that generated returns in excess of 200%. Today he consults with microcap companies helping them with capital markets strategy and focuses on industries including cannabis, tech, and junior mining.