Info, if VLNC reaches their targeted sales rate of $75 MM annually, they will not have to go to the well for two reasons, they should be in a positive cash state, and to finance the additional $75 MM in sales (or about $25 MM in additional working capital) they can go to the IDB and draw down their loan line, The $31 MM should suffice for a full three quarter at current burn rate without sales, and I think that they will reach sales rate well in excess of $10 MM per quarter, reducing their burn rate by half or there about, and once they get to $25 MM per quarter, they should be in the "get growing" category. Sure, Murphy can have their way with VLNC and they may run into some trouble, but with $30 MM plus in the till, and a credit line of close to $40 MM from the IDB, once they start shipping from Ireland, they should do fine. It is no longer the floorless situation it was prior to early November last year.
Zeev |
