RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:RE:LEADERSHIP LEAVING PELLERHaha I have absolutely no clue what the interest rate is for this year... Interest was $5,273 for last quarter. This includes lease "interest".
Note 11 Long-term debt in last years AR is vague and complicated
The Company has entered into interest rate swap agreements to fix the interest rate on a portion of the balance outstanding on the investment facility. Until September 29, 2022, the interest rate is fixed at 2.25%, plus the applicable margin. As at March 31, 2022, the applicable margin was 4.00% (2021 – 1.90%). Interest expense on long term debt during the year was $7,750 (2021 – $5,925).
The Company and its subsidiaries have provided their assets as security for these loans.
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In the end management needs to manage cashflow and executive compensation.
They have great assets which they pledged as collateral however funding those assets with complicated short term debt seems a tad wreckless.
I think of the stock price like a call option now with many value drivers / destroyers:
Short Term Interest rates
Additional Wine Sector Support
Executive Stock & Option Compensation to Profit (this is a silent killer without stock buybacks. Do equity incentives encourage senior management to take outsized risks like using short term funding for long term debt?)
Pricing Power
Cost reduction (What is company bargaining power with their suppliers? Will company reduce ad spend? If hospitality management bonuses are based cost reduction I think they will reduce servers at Wineries / Restaurants or not give raises and lose Chefs, Wine stewards, etc. The savings show up immediately but customer perception of brand does not show up anywhere on current financial statements)