Xro - xero

[winner69]

They have tax losses cfwd.

Yep ....heaps of those.

Still going to be nz company so should keep those.

[winner69]

Cash burn $34m for H1

Do you think they will ever be cash flow positive

Interesting they now have a $100m bank facility

[777]

They have tax losses cfwd.

As I understand it you need to pay tax to have any imputation to attach to dividends so the losses are irrelevant.

[mikeybycrikey]

Even if they start making a profit sometime soon, I doubt they will pay a dividend for quite a while. Any additional cash is going to be put into growing the business for some time to come.

I think worries about imputation credits are irrelevant for at least the next 5 years but probably much longer.

They even say in the HY report: "Following cash flow break-even, it is intended that surplus cash flow will be reinvested, subject to investment criteria, to drive long term value."

Anyway, as a NZ domiciled company, can they not still pay imputation credits regardless of where they are listed?

[777]

I think the amount they can pay is dependent on the amount profit they make in NZ. I get some imputation credit on some of my AFI divs. Not all.


Found this which may explain it. Only skimmed over it myself
.

http://www.ird.govt.nz/technical-tax...an-imputation/

[brend]

What....so many misunderstandings here.

come back to basics...Xero is a NZ registered company. It is a NZ tax resident so it will pay NZ tax on NZ income and overseas income.

[Scrunch]

As I understand it you need to pay tax to have any imputation to attach to dividends so the losses are irrelevant.

You need to be paying tax to get imputation credits to attach to dividends.

As soon as Xro's only listing becomes Australia, the dividend consideration is likely to be franking credits for Australian shareholders. These have no value at present for NZ shareholders so NZ shareholders would need to pay tax on any dividends declared. Not really an issue while there is no dividend in the foreseeable future. 5-10 years down the track it could be and then there's unlikely to be much NZ tax paid relative to world-wide earnings. This will result in minimally imputed dividends, if they even carry any NZ imputation credits. Have a look at the imputation rate of dividends from companies like Ebos, ANZ and Westpac.

[brend]

You need to be paying tax to get imputation credits to attach to dividends.

As soon as Xro's only listing becomes Australia, the dividend consideration is likely to be franking credits for Australian shareholders.

Where a company is listed has nothing to do with tax.

[moka]

https://finance.yahoo.com/news/edited-transcript-xro-nz-earnings-062930380.html

Edited Transcript of XRO.NZ earnings conference call or presentation 8-Nov-17 10:00pm GMT

[moka]

Cash burn $34m for H1

Do you think they will ever be cash flow positive

Interesting they now have a $100m bank facility

Rohan Sundram, Citigroup Inc, Research Division - Director [14]
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Just one question. On the new debt facility, just trying to understand your thinking on the rationale given that you've got a pretty ample cash balance. Under what circumstances could you envisage drawing down on that facility such as -- is M&A still a possibility or what are the circumstances?
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Sankar Narayan, Xero Limited - Chief Operating and Financial Officer [15]
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The debt facility is purely intended to be insurance. We heard feedback from some investors that they would like to see a greater liquidity buffer, and we acted on it. The positive -- and we don't intend to draw on it. The good news is, as Rod mentioned in his opening remarks, it's a great validation for banks to put that debt facility in. It shows the growing maturity at Xero. So we're really pleased to have that, but it's purely meant for insurance purposes

https://finance.yahoo.com/news/edite...062930380.html