ORAGIN Foods Inc V.OG.H

RE:RE:RE:RE:RE:RE:RE:Insolvency Filings Incoming?

[financemajor]

Look at revenue in previous quarters when the last two renovated stores were operating. All that revenue is coming back. Nice inflation bump as well.

I disagree. Look below.

rwfresh wrote: Profit? They are pursuing growth like most publicaly traded companies. For sure, would be nice if they were profitable but given their assets and their revenue, it shouldn't be a problem. But they are unlikely to switch focus to profitability right now. Any profit would be pumped back into growth. What matters is revenue. Revenue was down last two quarters due to renovations in existing stores. Which are completed and will push revenue much higher in the current quarter.

What money has been pumped back into growth the last five years exactly? They have not expanded or opened a new store since 2018. Also, you keep mentioning revenue as what really matters -- but their revenue has stagnated/decreased from years prior. Both in 2018 and 2019, their revenue numbers were higher. I urge on the side of caution when looking at revenues during the COVID years. All grocery retailers experienced a significant bump in sales during 2020/2021, but this has started to revert back to normal -- therefore, it is more accurate to compare to years prior to COVID. 

Profit matters after 16 years of being in operations. The company has a total deficit of -$15.1M... That's not just "investment growth" pains -- there is something fundamentally wrong. Their margins/cash flow is not sufficient to keep afloat. 

rwfresh wrote: At 9% interest there is no real reason for them to demand payment of the loan. They can just sit and collect interest.

Typically, I would tend to agree with this point. It is a reasonable option. However, why does any lender demand payment of principal? The lenders in this case may feel as if the stock options accrued on interest are not worth the risk of extending the loan payment. I know you do not believe it, but there is a serious risk of insolvency -- although investors holding debentures have preferential standing during insolvency hearings over common shareholders, it is not worth the risk of this occuring for them. As time goes on, this only becomes more of a likely scenario. Therefore, they may regard immediate repayment of the principal as the safer option.