Quote from page 6 of the report under the heading "Going concern"
"The group's ability to continue as a going concern is reliant on cash flows from it's finance facilities and the sale of non core assets"
That is a really scary statement.
The $40m working capital facility has been extended to April 2012. Expect 60% of the LL cash to go and pay that back.
Also if you look at the bal sheet, current interest bearing liabilites are $66m ($40m working capital + $19m owing to GHG) - Would it be too long a bow to draw to say that it looks like LL was sold to pay current debt - it will strengthen the bal sheet, but KZL still has some really huge issues to resolve very soon.
Look at the cash flow report, nearly $36m was lost from operations in 6 months - that is a $1.4m per week cash drain.
GD has started to make significant changes to stop the cash leakage, but the report acknowledges that the company is not in a good position.
HT1
KZL Price at posting:
31.0¢ Sentiment: Sell Disclosure: Not Held
