You are tired of being wishful, you you are going to just claim BK and forget the whole idea. Great idea.
Now, Q4 they do not burn any assuming their accounting system is not the same as Apple's, Q1 and Q2 they burn at their normal rate. 4 x 6 = 24
How in the world will the pay the 210 million debt in Feb with that money if they need that cash to survive in Q2?
They need to refinance. Now, how will they do that ?
Ok, on the one hand you have the 150 million GM credit line. A credit line by a strugling company. I do not think so.
100 million Loral credit line. It can not be used. They need the 1 billion market cap.
What's left, earnings before interest tax depreciation and amortization ? Good luck. What will be the number ? 300 million ? by when ?
Lets face it, it will be very likely that they will declare BK before FEB 09. If they do not then I will be proven wrong and this will be one of the true and amzing good stories that emerge from this downturn. Until then I do not see how you can prove otherwise.
Ok... First so you say that they have 360 million in cash.Originally Posted by Siriusowner
Second, you say that the burn rate is 4 million per month.
Third, you correctly do the math that in 6 months, they will burn 24 million.
Then you say how will they pay 210 million with cash on hand?
Last time I checked, 360 milion minus 24 million is still 336 million dollars, well above the 210 million in debt. Am I doing the math wrong?
From the 3rd Quarter Conference Call
In the first 60 days following the merger, SIRIUS XM is operationally very close to breakeven.
When I reread your post, I think you meant to say that their cash burn was about 40 million per month, x 6 months would be 240 million, leaving them with only 120 million in cash on hand. I went back and checked on the conference call, and according to those numbers, there was only 44 million burned in the whole quarter. That equates to 14.6 million per month, at 6 months would be 87.6 milion dollars, which still leaves 272.4 million, still above the 210 million that is due.
And that is without adding any FCF for Q4 this year.
Take into account that generally Q2 is opperationally better than Q3, and you may even decrease that burn rate further.
This is without any financing.
Last edited by Siriusowner; 11-21-2008 at 10:54 AM.
LOOK who added more yesterday...
Goldman Sachs Group Inc Institution 0.00 % 2008-11-19 11,244,513
They have some cushion to carry them thru the first 2 quarters. And with the savings from the synergies and the cash raised from the 4.5 Bil shares dilution they will be better. Good.
Like I said I do not remember where I heard the 360 mil burnt in 9 months but it might have been another company and I did say at the beginning that "I thought I heard somewhere..." maybe I heard 40 mil per month instead of 14 mil .... That is why I wanted a confirmation.
All the other stuff is no less important but as long as they do not burn that cash stupidily (the main difference between genius and stupidity is that genius has its limits) they may be ok.