HW would be better off if ...1. HW wouldn't open any more stores until the ones they already have are profitable.
Existing stores are not profitable and certainly will not be profitable in this year or the next year.
More stores = less exclusivity (i.e., if HW only had stores in NYC and Beverly Hills; these stores
would be profitable.)
2. HW would forget about buying any of Rio Tinto's 60% share of Diavik while HW shares sell below book value.
Rio Tinto isn't going to to sell their share of Diavik below book value. While HW stock sells below book value, HW would be better off buying back their own stock. HW doesn't have the financial strength to do that now. Any acquisition would be a "big deal" for HW but for Rio Tinto, BHP Billiton or De Beers acquiring HW's share of Diavik or HW itself would be "no big deal."
3. HW would eliminate their dividend in order to save $12MM.
Don't expect any free cash flow for HW in the next year or two. Under ground mining is more capital intensive.
Its a bda time to refinaince debt and as for raising capital right now - forget about it.
Rio Tinto is the best diamond miner in the world - look at how they exploited the Argyle mine. HW's 40% share of Diavik is the envy of any diamond mining company. If Diavik diamonds were gold, the financials for Diavik would insure that a share in the Diavik mine would never sell below its book value.
Petra Diamonds has 6 mines and the revenue from those 6 mines is less than HW's share of Diavik.
Those 6 mines are historically 6 of the 24 most productive mines in the world.
https://en.wikipedia.org/wiki/Petra_Diamonds
Diavik is currently the best diamond mine in the world.