RE: lost 20,0000 Are you saying that the contractor bills the oil or gas company and not PSN? In that case the receivable is really from the contractor and not directly with the Oil and Gas company that uses the tanks- Is this right?? That is a far worse fact pattern than I thought- I thought the receivables were from the oil and gas companies which you would think would all pay.
At sept 30th PSN had 135 million receivables on say 145 million sales in the entire year ( frankly just UNBEILIEVABLE)- they then wrote down receivables by 9.5.mm If these receivables are from independent contractors., as their agents, then PSN icould be in big trouble on these collections.
You are right, they set up the full amounts as receivable in first and second quarter and what is amazing called it IBITDA under their definition. How can you collect less than 20% of your sales in cash for the entire year ( the remainder, 270 days worth. stuck in A/R ) and not notice it until,l as I saw on their latest PR piece, until just before this quarter release??? IBITDA seems to be vastly overstated as 135 million of it is in receivables- note they didn't reduce the IBITDA by the 9.5 bad debt??????????
. Many on this board talk of a 100 million cash on hand at Sept 30- there is no cash- there is a huge bank loan and the bank loan is used to finance the dividends
Bad debts will be a nightmare when the audited year end statements are finally out- get ready for a delay. Its anyone guess what the write down will be at year end- but to speculate that the 9.5 bad debt reserve is a one time write off is naive- - as you say the bank will be all over this next week-
I was lucky and sold a while back but was keenly interested in this quarter , as was going to buy back in - however- I dont think its worth anything close to 5 bucks- in fact I am not sure I would pay a dollar a share after reviewing the quarter again--
what if ;
the dividend is stopped jan 1 as they wake up and realize borrowing at the bank to pay is stupid
the bank comes in - looks at new info and reduces their credit limit
a lot or all of the receivables are in fact with the contractors some of whom will not be able to pay
they need to write off say all receivables over six months old at year end audit- might be over 30 million
you can see how the share gets to below a buck easily
I was a very strong supporter of PSN for a year- you can see my earlier posts six months ago- but now I feel really let down- yes I was lucky and I thank one of the posters on this site for me selling my last 20% of PSN as I started looking into pricing issues- but I have a few friends still in-
I think a lot more is going to come out in the next few weeks and it wont be pretty. A lot bought Nortel at 30 bucks, as based on its high of 120 it seemed cheap- its the same story- find a basis to determine why the stock should be 4 or 5 bucks based on facts not emotion