In the financial report dated November 21st, they stated they had C$19 million in cash.
As you know, depreciation is not a cash item and neither is amortization, so you shouldn't subtract them from cash.
Also, from the prospectus, they upgraded their SG workstations with new motherboards from SG that they gave them a deal on for upgrading. ALso, they typically lease the equipment and tie it into specific projects, lowering the risk of expansion. If they are expanding, I'm sure it's on the back of contracted deals that we just don't know about yet. The reason being that all the management owns large amounts of equity. That means they'll neither want to dilute themselves much or toe the line too tight on cash.
ALso, you can usually bank a production once sold so as to get the working capital needed up front on a production, that is if you even need to.
I'm not sure where you got your info. You might not have counted the convertible bond as essentially equity (which it is) and substracted that debt from your cash number or something.
As for the director's, I'm sure they can hire a few freelancers if they need to and if any are good, hire them full time. The last two series they produced under budget and ahead of time, so it must be working.
The Imax RideFilm are isn't as big as you said according to the company. It's only 3-4 workstations and less than 8 people. They aren't working on the 3D movie yet according to the company. The RideFilm entails very little upfront. According to the prospectus, it's $500,000 split between the two partners. That ain't much. It's only 5 minutes and not in super IMAX Hi-Res. Plus, all the characters and many backgrounds are already digitally created and stored.
The cashflow coming in from the rides will be many millions next year. According to IMAX, it's the best RideFilm yet and certainly Playdium in Toronto will back them on that. Give them a call. They get a nice, 100% profit on that stuff. |
