FormerXBC Inc XEBEQ

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Xebec Adsorption Inc designs, engineers, and manufactures products that are used for purification, separation, dehydration, and filtration equipment for gases and compressed air. The company operates in three reportable segments: Systems, Corporate and other, and Support. Its product lines are natural gas dryers for natural gas refueling stations, compressed gas filtration, biogas purification, associated gas, engineering services, and air dryers. The company's geographical segments are United States, Canada, China, Other, Korea, Italy, and France.

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FormerXBC Inc > Margins

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Comment by gwalkeron Oct 28, 2021 3:12pm

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Post# 34060284

RE:RE:RE:RE:RE:RE:RE:RE:Margins

Accounting does not work this way.

Paying the expenses now will have no effect on the margins (they could buy the materials for the next 3 years and it would just go to inventory and would not effect margins)....unless XBC recognizes revenue on a percentage of completion basis which i am pretty sure they don't.

Ciao wrote: OK, you're thinking expenses taken in Q2, so now they will reap the benefits in Q3 and onward

kulewater wrote: Really depends on when they assumed the expenses.. if they committed to purchasing the raw materials in Q2 they could have already been absorbed - leaning on the margins asymetrically.

Moving forward those expenses wouldnt weigh on the bottom line in future Qs. Its a very shrewd and smart move if thats indeed what happened.. and based on what I know of Mr. Bombardier its very likely.

How does that work? It won't have a positive effect on this quarter but the next as they are taking up expenses that won't be required in subsequent quarter(s).