Going Public

[layoutshooter]

Do you have goodwill listed on your balance sheet? But yeah, if part of your goodwill is attributed to them, you can, actually should, write it off if they do, so as to better reflect the actual value of you.

There's a Good Will Hunting joke in here somewhere.

Nope, no goodwill listed, lost out again? I have never hunted Good Will, what do the look like? Why would I joke about hunting them? Is that something like "snipe hunting"?

 

[DaWhale]

Turtle,

I applied myself to reading the 200 page statement and applying my superficial skills to the analysis of both their financial statements and various notes. My conclusion still stands. Bleeding is a pejorative term, but accurate nonetheless. I found the following in their statement.

Over the past three years, our primary sources of cash have been cash flow generated from operations, borrowings under our Existing Credit Facility, sales of subordinated notes, sales of preferred stock, and trailer operating leases. Our principal uses of cash have been to fund working capital, debt service, acquisitions and capital expenditures. We also require letters of credit to support our insurance programs. Cash required to fund capital expenditures has been minimal, averaging approximately one percent of revenues in each of the past three years. At June 30, 2010, we had $0.1 million in cash and cash equivalents, $19.3 million in working capital deficit and $5.0 million of borrowing availability under our Existing Credit Facility.

The company generated invoices for sales in excess of 90 million dollars. I haven't found a metric that quantifies receivables turnover, but we can safely assume that it's at least 30 days based on the cash available on hand above, as well as the operating margins relating to cash expenditures on their statements.

My perfunctory observations based on my experience and the small amount of information provided in the original article appear to be valid. However, I’m willing to be educated. Please show me on their financial statements where significant cash exists or how my analysis is inaccurate.

Incidentally, I've enjoyed researching Panther in the last couple of days. Thanks for challenging my statement.

 

[DaWhale]

Panther’s definition of Goodwill and Goodwill Impairment follows verbatim from their statements.

Goodwill represents the excess of cost over the fair market value of net assets acquired in business combinations. In accordance with Financial Accounting Standards Board Accounting Standards Codification, Topic 350, “Intangibles—Goodwill and Other,” or Topic 350, we test goodwill and indefinite-lived intangible assets for potential impairment annually and between annual tests if any event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount. Any impairments in our goodwill and in definite-lived intangible assets is charged to our results of operations. Our evaluation in 2009 determined that there were indicators of an impairment. These indicators included a significant decrease in operating results, a decrease in non-financial key performance indicators and other macroeconomic factors. As a result of our testing of our goodwill and other indefinite lived intangibles in 2009, non-cash impairment charges were recorded reducing the carrying value of our goodwill and trade name by $28.1 million and $5.4 million, respectively. We may never realize the full value of our intangible assets. Any future determination requiring the write-off of a significant portion of our goodwill or intangible assets would have an adverse effect on our financial condition and results of operations.

From what I've read, Fenway is not being bought out. It appears that the company is indebted to Fenway through senior subordinated notes and the IPO is a vehicle to repay that obligation as well as other debt. Fenway still owns or controls a majority of the common stock.

 

[Turtle]

Are you one of those who actually root for movies to tank at the box office? It would seem you want Panther to tank, and would take great pleasure if it happens. Look at the revenues and the operating expenses, look at the consolidated data. It's all there. Then take into account acquisitions, principle and interest payments for them, and what the economy and the industry did in the last two years. We don't have the privilege of looking at this kind of financial data for most carriers, so it's easy to look at this report and pick apart the things that stand out as not being ideally positive. It's also easy to dismiss many of the mitigating factors as to why the numbers are the way they are. Their revenues, less operating expenses, have them in the black. They were in the red last year, like everyone else, but this year, so far, they are in the black, something that many carriers cannot yet state. Their cash-on-hand, while a positive number, is down considerably from previous periods, but acquisitions (and interest payments) account for almost all of that.

No, Fenway isn't being bought out, they will still continue to own a majority of the stock, but this is what Fenway does. They buy companies, or at least controlling interest in them, then take what they can out of them and build them up for the long term, and then about 5 years later take the company public. Fenway expects to make a tidy profit from the IPO, as well. Fenway is very good at what they do.

But if a company is in dire straights, bleeding cash, it doesn't have a prayer of a successful IPO or much of a life as a public company. If the company was as bad off financially as has been alleged in this thread, an SEC registration for an IPO would not have been filed in the first place, since no one would buy any of the stock.

 

[DaWhale]

are you one of those who actually root for movies to tank at the box office? It would seem you want panther to tank, and would take great pleasure if it happens.

I haven't kicked a puppy today, but it's early. My only agenda on this forum is to learn about the expediting business. I look forward to reading the posts each day, it's almost become a hobby. My interest in Panther, prior to this thread, was as a prospective carrier. That hasn't changed.

look at the revenues and the operating expenses, look at the consolidated data. It's all there. Then take into account acquisitions, principle and interest payments for them, and what the economy and the industry did in the last two years.

Any company still standing after the last two years was managed by people who were lucky, smart, well funded or stubborn. That includes every owner operator leased to Panther or any other carrier.

we don't have the privilege of looking at this kind of financial data for most carriers, so it's easy to look at this report and pick apart the things that stand out as not being ideally positive.

It's not a privilege, it's a right based on law, ponzi schemes and ocean front property in Arizona. My response was limited to the posts that were written by the two of us. The facts presented could be positive or negative, depends on how you analyze them.

it's also easy to dismiss many of the mitigating factors as to why the numbers are the way they are. Their revenues, less operating expenses, have them in the black. They were in the red last year, like everyone else, but this year, so far, they are in the black, something that many carriers cannot yet state. Their cash-on-hand, while a positive number, is down considerably from previous periods, but acquisitions (and interest payments) account for almost all of that.

I made no attempt to dismiss any mitigating factor. Operating expenses or operating margins to me are all cash expenditures and revenue. P&L and balance sheets are for accountants and financiers. Running a business means that cash management is one of many primary concerns. Investment in a company is based on a different set of criteria.

no, fenway isn't being bought out, they will still continue to own a majority of the stock, but this is what fenway does. They buy companies, or at least controlling interest in them, then take what they can out of them and build them up for the long term, and then about 5 years later take the company public. Fenway expects to make a tidy profit from the ipo, as well. Fenway is very good at what they do.

Fenway and other investors are an essential engine of growth in this economy given the banks tightened lending standards. Free Enterprise means that you're rewarded commensurate with ability and risk. I'm envious of Panther actually. I wish my business had that kind of money behind it.

but if a company is in dire straights, bleeding cash, it doesn't have a prayer of a successful ipo or much of a life as a public company. If the company was as bad off financially as has been alleged in this thread, an sec registration for an ipo would not have been filed in the first place, since no one would buy any of the stock.

I never said the company was in dire straights, perhaps it was implied. The information is available to make an informed decision based on fact, not opinion. I doubt a serious investor would be swayed by the opinion of anyone posting on this forum.