Does anyone realize that each month when they pay a dividend of 9 cents or 7.2 million dollars in tota,l all that happens is the net book value of PSN goes down by 7.2 million. so- you get your nine cents, but PSN is worth 7.2 mm less- so there is no free win here folks- in fact for PSN, the 7.2 is all borrowed each month as have the last five dividends.
At Sept 30 the bank loan was 50 million plus and after two dividends its will be around 64 million as cash flow has been NEGATIVE not positive now for six months- If you don't believe this ask yourself why was there no bank loan at start and now one over 50 million if there was positive cash flow.
This is exactly the same as if you went to your bank and borrowed 10,000 dollars- then looked at your bank statement and were so happy that you had 10,000 dollars of cash in bank account- and next month you borrowed another 10,000 etc- and again were happy as a clam
those that want even a 2 cent dividend are living in la la land as that is the only way such a div can be paid
the bank will kill the dividend and may wise up and do it now rather than wait till dec 31
all that quote- IBITDA is tied up in accounts receivable
you can read the accounting policy note to read that they recognize rents far in advance- so rents for this quarter and part of 2013 could have been already accounted for as sales and stuck in receivables.
what this means is unless there is expansion in fourth quarter - most revenue received in December has been pre booked in first half of year-
the proof is in the receivables
If this is the case- and I don't know - this is pure speculation by myself based on info disclosed in public- then next quarter will be a loss- as all the IBITDA and profit has been already booked- and PSN will be left with a very large bank loan and bankers who are very worried and no where to go
I don't see how it can trade much above 2 dollars - even that is 160 million . cap- 75 cents is closer to true value
the number one question to ask to management is-- do you pre book any revenue??? and if so- how much of rentals for fourth quarter and first quarter 2013 are already booked??? thats the question for management as right now I ,and no one really knows for sure what their policy is
why buy based on what stock was priced at when You have no clue what its really worth??
of course you might blame the current price on short sellers or anything other than the fact that PSN is always going to be worth 4to 5 times futre cash flow and that could mean around 2 bucks or less a share-