Is Concordia Paying Down Debt? Per Q2 report, noFor those looking for a silver lining in the latest quarterly report, the question could easily be whether cash flow is paying down their debt. Here's the answer, quoted from the latest quarterly report here: https://concordiarx.com/wp-content/uploads/CXR-Q2-2016-Report-1.pdf.
Long-term oblications decreased by $120 million because of the adjustment in the foreign exchange rate (aka UK Debt value dropped with the currency), deferred financing costs, and reduced income tax liability. Only $9.5 million was repayed on the debt principal, and money owed on term loans actually went up by $12.2 million. So in reality, money owed to debtors actually went up by $2.7 million in the first 6 months of the year. The question for shareholders really needs to be how quickly is Concordia going to pay down their debt.
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Long-term obligations consist of long-term debt, notes payable and purchase consideration payable, other liabilities and deferred income tax liabilities. The $119,999 decrease in long term liabilities from December 31, 2015 to June 30, 2016 is primarily due to the following factors: -
The long-term portion of debt decreased by $74,101 due to approximately $9,530 of principal repayments, an increase of $12,226 to the current portion as a result of increased contractual repayments on the Company’s term loans and $67,250 foreign exchange impact on the Company’s GBP term loan, offset by the impact of $15,263 accretion of deferred financing costs;
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A decrease of $4,711 in purchase consideration payable due to purchase consideration due in the first and second quarter of 2017 now presented as a current liability, offset by the non-cash amortization of the discount on the long term liability; and
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A $41,211 decrease to the deferred income tax liability primarily due to the amortization of intangible assets acquired in recent business combinations and the impact of foreign exchange. "