Xebec Adsorption Inc (TOR: XBC) is a provider of clean energy solutions for renewable and low carbon gases in energy, mobility, and industrial applications.
Upon releasing their Q1 results in May shares came crashing down – more than halving in value over the space of two days. The price further slumped over the next months, with prices currently trading at CAD$0.75 (01 August 2022).
Despite revenue beating most expectations with CAD$41.2m, investors were spooked at losses worsened to (CAD$18m) – nearly doubling from last year's quarter loss of (CAD$10m).
The net margin for Q1 was a loss of (43.9%), lower than last year's quarter loss of (47.6%).
Xebec haven't always been loss making – in the final quarter of 2021 they earned CAD$2.42 on record revenue of CAD$46m – as well as CAD$2.02m for FY19.
Total cash levels had been incrementally declining to CAD$24m, down from CAD$100m in last year's quarter – leaving investors worried about how Xebec would raise further cash and the risk of dilution or increasing debt levels amidst interest rate rises.
Total assets were CAD$464m, which was up from CAD$419m in last year's quarter – but were down from record levels of $497m as of 31 Dec 2021.
Total debt was CAD$83m – representing a current liquidity margin of 17.9% (compared to last years quarter of 13.1%).
Xebec's balance sheet has been growing considerably over the last few operating years, with the 2020 trading year taking assets levels up to elevated heights. The liquidity margin was 12.8% in FY20 and 17.7% in FY21.
Xebec Adsorption release their Q2 earnings for the year on approximately 15 August, 2022.
https://www.ecoshares.io/post/xebec-investors-clash-prior-q2
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