09:26:49 EDT Fri 29 Mar 2024
Enter Symbol
or Name
USA
CA



Essential Energy Services Ltd
Symbol ESN
Shares Issued 141,856,813
Close 2017-09-14 C$ 0.52
Market Cap C$ 73,765,543
Recent Sedar Documents

Globe says Essential Energy trading below book value

2017-09-15 07:20 ET - In the News

The Globe and Mail reports in its Friday, Sept. 15, edition that the assumption that current assets can be liquidated at book value is flawed. The Globe's guest columnist Robert Tattersall writes that it would be better to discount assets to a level that would give comfort to a lender. The Globe considers Essential Energy Services (53 cents). It trades at less than half of its book value per share because the sector is out of favour and there is a pending lawsuit alleging patent infringement that is not included in the liabilities. Net-net working capital per share is only 12 cents, so the stock would not excite Benjamin Graham, but the collateral-value calculation presents a different picture: As of June 30, 2017, cash on the balance sheet was $1.1-million, accounts receivable were $24.4-million, inventory was $30.8-million and net fixed assets were $139.6-million. Total liabilities, excluding any legal costs, were $46.3-million. Deduct total liabilities of $46.3-million to leave a net collateral value of $128.1-million. With 142 million shares outstanding, net collateral value per share is 90 cents. This is below the book value of $1.14, but well in excess of the market price.

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