RE:RE:New to Colabor Group DiscussionI have looked at GCL recently to assess its’ viability going forward and also find it intriguing. With the wholesale division providing much better margins (8% vs 1%) than distribution, the sale of Summit (not closed) should be beneficial normally. How Sysco adapts to the New World is unknowable. Other uncertainties are: 1) has Recipe paid for the inventory as per the agreement; 2) does the Summit deal close; 3) will margins compress on the wholesale side because of the loss of hospitality and restaurants; 4) Q1 Financials could be messy.
On the certainty side, working capital stood at $58 M at Dec 31/19 and should improve if Summit closes ($10M). In addition, the new inventory should be designed for Quebec consumers only more easily.