" 3. Had to "borrow" cash to pay dividend. i.e. - cash flow was...

"
3. Had to "borrow" cash to pay dividend. i.e. - cash flow was not enough to pay CAPEX and dividends.
4. page 22 of the presentation reported net capex which is quite misleading, it paints a picture of positve cash flow which, IMO, is wrong.
"

@horsetrader,

That's not quite right.

They generated $38.7m in Operating Cash Flow.
Plus they received around $0.6m from a few odds and ends (mainly distributions received and interest income)
Payments for Property, Plant and Equipment (effectively, stay-in-business capex) amounted to $9.8m.

This equates to Free Cash Flow from Operations of $38.7m plus $0.6m less $9.8m, which equals $29.5m.

So that's the amount of surplus capital the company generated during the year, which the board is mandated to allocate, at its discretion. To that end, it could either:

1. pay down debt,
2. return it to shareholders,
3. invest it into growing the earnings of the business, either by expanding existing facilities (brownfields expansion), establishing new facilities (greenfields expansion), or acquiring existing facilities, or
4. a combination of the above

As it happened, it paid $22.5m of the $29.5m as dividends to shareholders.

Leaving $7m with which to do other things.

This remainder it applied to purchasing existing facilities in order to grow the company.
(As it happens there wasn't enough capital generated in the year to fully fund the acquisition(s), so the company had to utilise some extra debt in order to make the purchases.

But the point is that the company's management did not have to borrow in order to pay dividends.

It could simply have elected to not make the acquisitions (presumably that it did so means that it considered them to be shareholder value-accretive), in which case there would have been a capital surplus even after the payment of dividends.


"The Ugly
1. The balance sheet has 84% of the assets as intangibles."

Why do you consider intangible assets to be ugly?

Would you feel better if the intangibles were somehow replaced by hard assets?