Adrian J Cotterill, Editor-in-Chief
Shares of Daktronics (NASDAQ: DAKT) fell 40% in a single session this week and if the experts are to be believed, it very much looks like they may fall further.
The company filed a document with the SEC that we are told, raises serious questions about the business’s status as a “going concern”.
From their press release…
“Ongoing supply chain disruptions and inflationary challenges in materials, freight, and personnel-related costs have and will continue to cause volatility in our cash flow, pricing, order volumes, lead times, competitiveness, revenue cycles, and production costs.
Our ability to fund inventory levels, operations, and capital expenditures in the future will be dependent on our ability to generate cash flow from operations in these conditions, maintain or improve margins, to use funds from our credit facility, and to find other sources of liquidity.
Although supply chain disruptions have started to ease, and we expect our inventory levels to decline, we cannot be certain we will not experience future disruptions or need additional liquidity to fund inventory levels, operations, and capital expenditures.
We will need additional liquidity to meet our obligations as they come due in the 12 months following the date of this Form 12b-25, and we cannot be assured that such liquidity will be available or the form of such liquidity, such as equity raises or debt financing. These conditions raise substantial doubt about our ability to continue as a going concern.”
The stock currently trades at a 20+ year low.
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