Criticalcontrol Sltns Cp CCZFF

debt level

[Barbazan]

Thought I would post this and get some thoughts. Asked a reputable IA to take a quick look at their balance sheet. He was brief, had some nice things to say re revenue/margin growth, sector but here's his concern:... legit? "I went in and looked at their balance sheet and it was not encouraging. They have a fair amount of debt - with much of it coming due this year. They have net "equity" in the company of about $12 million. Of this, about $6 million sits as an asset called Goodwill which means they must have bought a company in the past and paid more than it was worth (on the books) and thus classifying the difference as "Goodwill" (common practice). BUT if you decide to wipe out the goodwill against the equity (normally you would do this over a period of years) - it brings the equity component down to $6 million. So they have a net shareholders capital of $6 million and have borrowed a further $6 million and put this into the company. I have seen worse but they have to get their act together soon and start making some money - not just to repay their debts but also to appease their shareholders who eventually want to see a return on their $6 million."