Paul,
I'm seeing BOST's negative cash flow from operations at about $29 million for last quarter EXcluding the $58 million pass-thru losses of area developers.
Here is my cash flow calculation for BOST's latest quarter:
Income (Loss) from Operations (308,731)
ADD BACK:
Depreciation and amortization
(excluding goodwill amortization) 16,806
Goodwill amortization 5,954
Provision for loan losses 202,000
Losses of Boston Chicken Inc.'s area
developers 58,079
SUBTRACT:
Interest income 3,221
Approximate Cash Flow from Chicken Ops ($29,113)
It doesn't matter what reasons were given for the negative cash flow such as new restaurant openings etc. It all goes in one big pot and I look at the big pot for store operations.
If you notice above, I have excluded the $58 million in area developers losses. These losses are predominately non-cash write-downs BUT somewhere buried in this number is restaurant operations losses probably equivalent to the average overall negative cash flow per store of BOST's company owned stores. Whose losses do these become when the area developers are "purchased" by BOST? You can bet it's BOST.
Now a summary of these line items:
Approximate Cash Flow from Chicken Ops ($29,113)
Interest expense, net (16,767)
Interest income 3,221
Of course, cash flow from Ops doesn't service interest or principal repayment. If these losses continue into future quarters, BOST will be forced to file bankruptcy. They aren't going to file BK with zero cash on hand. They will plan on at least 60 days of cash on hand to fund operations when entering BK. Remember, the negative $29 million above doesn't include the future pass thru of restaurant operating losses from the soon to be acquired area developers.
They will sell 17.3 million shares of ENBX at around $3.50/share for proceeds of $61 million. (This share price reflects a discount for ENBX as it is becoming undercapitalized and so the new majority owner is going to have to cough up more money to later infuse into that operation.)
To be fair, I have excluded the line item below (positive $12 million):
Minority Interest in (Earnings) Loss
of Subsidiaries 11,948
This is how I see it but like others I don't have a crystal ball. If I did have a crystal ball I would be retired and not posting here. <g>
The key to determining their excellaration towards bankruptcy will be next quarters results and the expected restaurant losses of the soon to be acquired area developers. |
