Converge Technology Solutions Corp T.CTS

Volume back down

[Pears3250]

How is everyone holding up? Its been an absolute disaster so far but atleast the super insane volumes have stopped

[PuerSimia]

'Absolute disaster' says it all. The volumes are down as there's little interest at owning the stock at this time. Their last financials continue to show their cash reserves are tanking. If it wasn't for moving the $400+ million from current liabilities over to non-current liabilities, their working capital deficiency would be over $300 million. That's a problem. In my

[Capharnaum]

The borrowing that moved from current liabilities to non-current liabilities was never included in their working capital changes. Working capital changes aren't "deficiencies" either, they're usually timing based and match the fluctuations of account receivables, inventories and trade payables (not debt/borrowing). You can look at the variations in table 13. What's hitting

[AlwaysLong683]

No way you want to get anywhere close to the max on your credit facility, risk being unable to pay the bills or stay onside of the conditions placed on the facility by the lenders, and possibly finding the need to seek protection from creditors (i.e., CCAA proceedings). I doubt it will come to this, but CTS has conditions they must continually meet to prevent their credit facility from going

[Capharnaum]

I don't disagree that you don't want to stretch your ratios. That said, the ratios are usually based on EBITDA and on that side they seem to be doing fine. They exercised the accordion feature to increase the borrowing capacity to $600 million on Feb 9. That means they have scenario's in mind where they would get closer to $500 million (than current $430 million).  It's not

[AlwaysLong683]

Agree CTS seems to be safe for the forseeable future provided they continue to remain in compliance with their debt covenants, which is different from how much more they can borrow under their credit facility. Even if they violate a condition of their loans, the lender(s) will typically meet with the company and come to an agreement that relaxes that debt covenant and allows the company time to

[Stonksonlyup90]

Good post, thanks for your insights. Regarding your comment on inflation and rising cost of inputs, certainly their clients/end users are also seeing significant inflation in their cost structures (especially rising wages). One way to combat rising costs is to create more efficiencies (ie, IT implementations/upgrades that allow for a reduction in headcount etc). So with that said, I do still think

[Steelfan26]

Horny lorny was correct .. wonder if donville junior  still owns this  .. I bought this Garbage at 3.96 .. should of known better .. made the same mistake with xebec .. all that being said it's a hold .. lol