Um.. The numbers you're pointing to don't address the real situation, it just the same glossed over PR they issued. Has nothing to do with READING the actual financials.

Quarter was still at a loss, making eight in a row, just not a big a loss as before. Just like consumers using two much debt, this is just a scenario for living on borrowed time. A company can only go so long with each and every quarter being at a real CASH loss before time runs out. If at the end of the day your making $10M and need $40M to cover your expenses, your on borrowed time. Don't be fooled by the fact of EBIDT being a number BEFORE bank debt is paid - which in their case is still very significant. Why do you think the focus in trying to get the debt down? Cause otherwise they would end up violating the EBIDT covenants to the bank again which they would have done last quarter had they not paid down the debt further.

Second quarter ending cash balance of $33.8 million - and it started at over $50M. Problem is their not generating enough cash to cover their expenses and therefore burning through the cash on hand - $17M of it last quarter. It doesn't matter if you have money BEFORE you pay the bank. That's like saying someone who brings home $10k a month is in good shape BEFORE they pay their $11k mortgage. Eventually the cash in the bank is going to run out.

Fact of the matter is, they have had two miserable quarters for sales, burned through $17M of their cash on hand and, as far as is still known from their refinancing last October, have no other credit facilities to get more cash. If they have a third quarter like the last two they will burn through a significant portion of the little remaining cash add a fourth quarter like that and they are out of cash. Do the math, it is there in black and white.

The company is generating a profit, yes, BEFORE making bank payments, but they are at a real CASH loss (not a paper GAAP write-down) after making the payments and the bank payments are a significant reason for the trouble.

In addition, they are issuing Preferred Shares in exchange for forgiveness on another portion of the debt held by the majority shareholders. So in addition to the cash burn, they further diluted the company with $1000/piece Preferred Shares.

No, at this point with sales levels where they are, they are now in last ditch survival mode. That is an understanding of the financials, not the glossy PR they have been putting out of late to deflect from the current cash crunch issues on hand.

Honestly, not too many companies can survive ten quarters of losses, yet that's where they are most likely going to be before the end of this year. Why do some still believe that the management that created the problem in the first place is even competent enough to manage out of the problem?