To: gvander who wrote (5113 ) 11/15/1998 4:43:00 PM From: Zeev Hed Read Replies (1) | Respond to
gvander, actually, if we assume that VLNC can get "material" orders by 1/27, then the cash flow analysis does come through. They need to recognize $4 MM to get the first chunk of funds from the IDB (Irish Development fund?), and after that the line of credit over for the next four year (actually, these might be grants rather then loans, or possibly combination of the two) can increase to another $39 MM if my reading of the last 10Q are right. On top of that, they have commitments to expand the current $7.5 MM floorless to $15 MM, and access to an additional $7.5 MM from Berg ($2.5 MM already taken down and, of course they have to meet certain milestones). All in all, if they indeed get a major order and actually get into production they have line up finance for working capital of about $60 to maybe $65 MM. That can support annual sales (as far as working capital is considered and using 30% of annual sales as WC requirements) of close to $200 MM without too much of a problem, and if they show just half that sales rate, I think they can get more traditional financing.
