JDN, I think your recollection of the cash flow statement
is in error. I've pasted the most recent one below. You
can see that the major adjustment to get from the small negative
earnings to the big negative cash flow from operations is an
increase in AR.
<blink>The increase in AR is $4.4 M from a year earlier. In comparison, the </blink>
increase in revenue in Q3 was a mere $0.4 M, compared to a year
earlier. So I don't see how anybody can attribute the growing AR to
growing the revenue.
So I'd still like to hear one of the TAVA fans out there explain this.
And I don't find arguments about personalities of the co.'s executives
to be persuasive. A quantitative explanation is needed.
The fact that the revenue hasn't been growing rapidly can be seen in
the table below:
REVENUES (Thousands of U.S. Dollars)
QUARTERS 1995 1996 1997 1998
SEP 2,809 2,723 7,967 11,319
DEC 2,185 2,654 8,137 10,484
MAR 3,138 5,859 11,183 11,667
JUN 5,344 9,397 9,556
TOTAL 13,476 20,633 36,843
now here's the cashflow statement
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine months ended March 31,
1998 1997
--------------------------------------------------------------------------------------------------------
CASH FLOW FROM OPERATING ACTIVITIES:
Net income (loss) $( 855,000) $ 489,000
Adjustments to reconcile net cash used in operating activities:
Depreciation 499,000 483,000
Amortization of goodwill and capitalized software costs 916,000 556,000
Amortization of debt offering costs 27,000 23,000
(Gain) on sale of fixed assets ( 16,000) --
Changes in operating assets and liabilities: (Increase) decrease in:
Accounts receivable (4,367,000) (2,648,000)
Allowance for doubtful accounts ( 731,000) 315,000
Costs and estimated earnings in excess of billings on
uncompleted contracts (1,401,000) (4,015,000)
Inventories ( 140,000) ( 154,000)
Prepaid expenses and other assets ( 464,000) ( 236,000)
Change in assets of discontinued operations -- 346,000
Increase (decrease) in:
Accounts payable (1,629,000) 2,123,000
Accrued expenses and other liabilities ( 226,000) ( 400,000)
Billings in excess of costs and estimated earnings on
uncompleted contracts 438,000 2,475,000
--------------------------------------------------------------------------------------------------------
Net cash from operating activities (7,949,000) ( 643,000) |
