OTCPK:PILBF - Post by User
Post by
teachon Mar 25, 2017 8:20am
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Post# 26029949
Polaris needs Cemex but can't make any money from them
Polaris needs Cemex but can't make any money from themWithout the volumes Polaris derives from Cemex, Polaris is DOA. This is high fixed cost business and Cemex provides the volumes that allows Polaris to survive. However, the dream of increased profits from the Cemex relationship seems to have evaporated, along with the stock price.
All the theoretical future profits will have to come from Polaris' own sales at Eagle Rock and Long Beach assuming LA and San Francisco doesn't go crazy like what's happening in Toronto (Summer Olympics for LA would help. We'll find out in September).
This will be a slow and steady process and many investors are not willing to wait around. Good news is the relationship with Cemex seems pretty solid, building activity is heading in the right direction, there is no debt so Polaris remains very much a going concern.
Whether they can boost volume and get lucky on price remains to be seen. I still remember how dead construction was in the Greater Toronto Area for what seemed like forever. Then, all of a sudden it changed and it hasn't stopped for 15 years. I"m a little concerned that expected population growth numbers in LA is on the low end of what was expected a few years ago but it still is a massive city. San Francisco is still growing like crazy.