Gatekeeper Systems Inc V.GSI

Q1 Results coles notes

[Thrttleout]

2023 Q1- GSI

 

The Good

-Sales Increase of 81% (Best Q1 to date)

-Paid down $3.5M on LOC & $3M in Payables - $6.5M reduction in Liabilities

-Collected $5M in receivables

-+90 days A/R has decreased from 30% to 25% of A/R

-No inventory write downs

 

The Bad

-Cash balance is shrinking & may need to tap into more funds through credit facility ($6M avail)

-Assets reduced by $6.5M (Cash down $1.75M,   A/R down $4.8M)

-Gross Margin decrease

-No new contracts, changes or updates on existing leads

-Operating expenses increased by 24% - Not terrible nor unreasonable for a 81% increase in sales activity

-COGS increased by 241% - pointed largely due to increase in U.S. Tariffs, working on strategy to mitigate these

- Operating Loss

[Torontojay]

  This is transparency! Good post. 

[Possibleidiot01]

I'm not the smartest guy but it appears they harvested  accountants receivable , reducing working capital to pay bills and the line of credit. Removing the debt caused the total assets to fall which resulted in essentially the same equity ( minus $95,000 change) for shareholders. As somebody posted on another board - this is a nothing burger.

[Vinobuono]

That is exactly as I saw it as well. The question that comes to mind is why the credit line was paid off so agressively?  I think Mr. Dyment is fully confident that the liquidity will be replenished in the next quarters which leads me to believe there are more contracts in the works. Thoughts? GLTA V