RE:info Wow! Talk about dredging the barrel for negative spin.
Anything taken out of context can be used to weight any argument. As mentioned this is ONE issue along side a list of positives
Yes, Auxly debt / equity ratio is higher than we might like to see but what isn't spoken to in thie article quoted, is the fact that the interest rate on the lion's share of Auxly's debt is a mere 4%. This effectively offsets a certain level of risk as compared to double digit rates carried by other LPs.
Also, Auxly paid down C$15 million of debt higher interest debt when the Sunens deal completed which occurred after the Q3-2021 financials were prepared. Thereby Auxly is actively taking steps to address and improve their debt ratio and will continue to do so moving forward.
Auxly has never had the luxury of an over abundance of spare capital. Working on and somehow still executing with a shoe string budget is something Auxly has demonstrated themselves adept at, with a high level of proficiency of late.
Fresh financials will be helpful here. The last ones are getting a little stale.
The Acquisitions Report was filed Feb.7,2022 on Sedar.
Q4&FY-2021 Report is just weeks away.
2022 will see big changes in the Canadian cannabis landscape as we witness Auxly Awakening.
cheers
settoretire wrote:
Underlying developments driving Auxly Cannabis Group's growth isn’t the focus of this broad overview, however, take into account that typically a pharma company has lumpy cash flows which are contingent on the drug and stage of product development the business is in. So, a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.
Before we wrap up, there’s one issue worth mentioning. Auxly Cannabis Group currently has a relatively high level of debt. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in Auxly Cannabis Group's case is 46%. A higher level of debt requires more stringent capital management which increases the risk in investing in the loss-making company.