To all....
Can anyone add analysis to this? I am in business, but not a CPA. While the trend of Westrend's performance since joining the shareholder ranks in 1996 is pathetic, I'm looking for prognostication about the future.
Glanced through the filed reports and found disappointing information. The auditors on 8/6/98 (referring to the 4/30/98 submission) clearly point to the trend of losses and working capital deficits such that "these raise substantial doubt about the Company's ability to continue as a going concern". Management, in the notes, state that "the company's ability to continue as a going concern is dependent upon its ability to generate sufficient funds through operations and to make financing arrangements to meet its obligations as they come due". Further, "management believes that actions presently being taken to revise the Company's operating and financial requirements provide the opportunity for the Company to continue as a going concern. On 8/12/98, Mark Roberts specifies some of the issues and favorable changes since 4/30/98... "The financial statement reflects certain issues, in the opinion of the management, such as startup costs, overhead, administrative costs, legal and accounting, commissions and notes and accounts payable that have changed favorably since April 30th". The management acknowledges that investment is finalized and that "we must cut expenses and overhead in order for our subsidiaries profitability to show up on our financial statements in the future. Finally, the current price of oil and gas is seen as affecting (holding back) Alamo Wireline, but Taylor Rigs is in demand by international clientele. Net verbage from management, the future looks good.
I read this as a mixed bag. Warnings by the auditor about the trend and state of financial strength... but management says that acquisitions are paid, operational expenses are getting paid and in fact overhead is getting reduced so that a profit can show. Finally, there is demand in one business and if the price of oil rises, the company is positioned to benefit in every business.
Integrating a multiline business through acquisitions of entrenched entities is very tough and these folks seem to have accomplished much. The oil & gas market is a drag in this instance as well.... La Nina is here too... potentially a long, cold winter.
What does anyone think about all this???
Patrick |
