Before you do your happy dance...CHK Q3 statementUntil Nordex begins to get its margins undercontrol there is significant risk to the stock. I hope they can but the following items stand out like a big swollen thumb.
Cash dropped by $1.737 million.
Current Liabilities though have grown, by $1,809,550 or 54%
Current Assets have only risen by $194,665.
Net Income for 9 mos. had dropped $32,951 from $329,652 to $296,701
Now that is a huge drop in earnings per share. Earnings per share dropped from $0.04 to $0.01 because of the massive and below below book value dilution.
I calculate that the present P/E is 19.3 I took the 9 mos earnings multiplied by 1.33 then divided by the 20,440,383. That is also assuming that they collect everything on their late accounts.
Related party transactions:
Legal and Accounting fees had risen by $104,227 or 51% to $310,016
Allowance for doubtful accounts of $94,000 was the exact same as it was at Dec 31, 2012. I would say that this account is rather long in the tooth.
At quarter end $508,585 was beyond Nordex normal credit terms of 60 days. (of which 100,218 was repaid after the quarter's end.) If these accounts are not brought into line Nordex' meagre profits will be entirely wiped out.
I am really happy to this increase in revenue; first and foremost though we have to see profit. It is time carefully look over all costs, time to put legal and accounting on a very short leash. It is time to collect on those debts.
Natural gas prices will be rising significantly this year, I hope that Nordex has built sufficient flexibility into their contracts to at least balance out their input costs as they are now not in a really super financially comfortable position.
Last but not least when are they going to do something about the Melba Gold property. If they keep dilly dallying they will lose it next year. That would truly be a waste of a good asset.