Friday, 29 February 2008

AeroMechanical's Comfortable Financial Pew

Those investors left confused over why AeroMechanical announced a $3 million bought-deal financing after company executives stated they didn’t need new money to hit cash-flow break even can be forgiven.
What the late Thursday (February 28th) release failed to mention was why the financing is taking place. It wasn’t because AeroMechanical needed the money.
Its September 30th financial statements show it had approximately $4.5 million in working capital and only $385,000 in long-term debt.
But as the Calgary company matures, its customer base changes. They tend to get bigger. And bigger customers often take a long, hard look at a potential supplier’s balance sheet to make sure that supplier has sufficient cash to weather any future market storms.
So AeroMechanical took the leap now to top up its financial reserves while the market for its shares is favourable. It is, therefore, a good news story that should give investors and customers greater confidence in AeroMechanical’s long-term viability.
To view the full press release please click here.