Cal Dive International, Inc. (OTCMKTS:CDVI) Has Another Nose-dive

For a while near the end of November it looked like Cal Dive International, Inc. (OTCMKTS:CDVI) had won back some investor favor, heading up in double digits for a few sessions. Unfortunately for its supporters, that state of developments did not last – two weeks and a series of horrific crashes later the ticker has fallen all the way down to $0.02.

So what has caused this all-time low in CDVI’s price history?

Well, to begin with, the company got de-listed from the NYSE, which would be a hard blow for any ticker. However, the downgrade itself is not really the event that pushed investors away – rather it’s a symptom of a much larger complex of enduring issues that have been plaguing CDVI for a long time now.

Inability to turn a profit is one serious problem – a quick glance at CDVI’s latest financial report reveals a frightening $42 million listed under quarterly net loss. True, the company has a lot of assets to its name and it is making substantial revenues, but at the end of the day profitability is the most impressive point in a report.

Another huge red flag that must have driven a bunch of investors away is the fact that CDVI is currently struggling with massive amounts of debt. It has a $100 MILLION credit lien, with regard to which it is already in default, and judging from its press releases, the situation is pretty grim. Also, apparently some of the convertible notes outstanding have become due because of CDVI being de-listed from the NYSE.

So, basically, the company has a ton of debt – so much that it will need to resort to sales of “non-core asset sales” and even “less satisfactory measures to provide liquidity for its operations”. What that last bit means is yet unclear, but one thing is certain – it sounds ominous.

Under these circumstances, it is really no wonder that investors are running for the hills and CDVI share prices are dropping like a rock. Unless the company manages to do something to remedy its debt situation soon, things will probably get even worse.