CBD - Cannasouth Ltd

[Toddy]

I can now see the sticking point. These companies tend to sell the silverware to survive. But in this case the silverware has a security over it.

My main question is still how did this happen so fast. Even the notes were issued for a 24 month period.

Depending on the cash burn from Jan to today (calling that 100 percent liability) add to that the notes value. Then take the plant value ( discount from bv as the market is tough and will take a lengthy period to sell)..... Then the Administrators are only left with one option. That is ask for shareholders to cough up say 10 million. Chances of that happening, I do not know.

[shareman]

1234567891011

[nztx]

The holders of Eqalis who sold into a merger with CBD their company with $6-7 m cash in kitty only back in
May 2023 for CBD shares must be really happy now

All the extra cash seems to have been gone by CBD's Dec 2023 balance date and it was back to scratching around for further Cap Raise & notes.

Revenue starting in Nov / Dec 2023 of just $200-250 K pm doesn't quite cut it when the merged outfit is bleeding $8-9 M a year .. Administration expenses seems a great burial ground $6-7 M just there alone.

Wonder why the Eqalis Directors who came on board in May 2023 decided to jump overboard in Dec 2023 ?


Obviously if CBD are bleeding about $8-9 million Red ink a year with low very late revenue inflows only starting in Oct 23, then it has to come from somewhere - doesn't it ?

The CEO hasn't come up with where the plantings of the high yielding mysterious fast money trees are located or if they died a painful death by a thousand cuts delivered by the mad scientists hiding in the Lab

The bridge a Gap Conv Notes were only going to cover a small part of the annual net outflows on Revenue deficit side before further digging & begging was necessary.

The CFO & Beancounters dont appear to have grasped the "what Funding Requirements are Needed Plan" before the whole operation reached point of self funding, or something has gone very badly astray

Perhaps there were no further available Merger Targets in the sector with large cash balances in hand that could be considered good marriage prospects able, & willing to part with a large dowry for the privilege ?

[deez_nutz]

Shareprice went into freefall after the merger - my extremely uneducated theory on this, eqalis shareholders who suddenly had their shares converted to cbd ordinary shares may have sold their shares with no escrow in place to stop them getting their cash out, selling at market sell and basically bottoming out the shareprice. It went from 30c at merger to single digits in the space of a year, despite positive announcements of revenue and products being approved. Can’t help but think this was an intentional strategy - will find out once the administrators have their plan for the future of cbd.

Edit: Also interesting to see the CFO has resigned (fallen on sword?) - should we expect the same from the CEO/Chair/Board?

[kiwical]

Shareprice went into freefall after the merger - my extremely uneducated theory on this, eqalis shareholders who suddenly had their shares converted to cbd ordinary shares may have sold their shares with no escrow in place to stop them getting their cash out, selling at market sell and basically bottoming out the shareprice. It went from 30c at merger to single digits in the space of a year, despite positive announcements of revenue and products being approved. Can’t help but think this was an intentional strategy - will find out once the administrators have their plan for the future of cbd.

Edit: Also interesting to see the CFO has resigned (fallen on sword?) - should we expect the same from the CEO/Chair/Board?

To be honest none of the 3 have done well. So it's not just a CBD issue. RUA and GFI suffered as well. Part of the problem was the NO vote to legalising cannabis here. While these companies seem to say that wasn't their target market it surely affected them.

[Getty]

CBD has gone to the pot.

[nztx]

CEO jumps overboard:

https://www.nzx.com/announcements/429429

[Sideshow Bob]

Wasn't Lucas the founder and largest shareholder?

Newshub reckons should be growing veggies - a real cash crop.....

https://newsroom.co.nz/2024/04/03/ca...iculties-bare/

[deez_nutz]

Wasn't Lucas the founder and largest shareholder?

Yeah, this is a real shame 😔

[nztx]

https://www.nzx.com/announcements/429589

COO terminated and thrown overboard now