Urban Barns Foods Inc (OTCMKTS:URBF) Stalls
Being a Urban Barns Foods Inc (OTCMKTS:URBF) shareholder hasn’t been the easiest thing in the world. Take the stock performance for example.
At the beginning of the year, the ticker was hovering around the $0.04 per share mark. Right now, about ten months later, it’s at just one twentieth of that price: $0.002 per share. URBF won’t win any prizes for consistency, either. Safe for a few volume spikes, trading has been quite slow and the few surges in the right direction that the ticker has experienced over the last few months have been rather short-lived.
That’s not much of a surprise considering the lack of news. The latest press release is now more than three and a half months old and it informs the public of some management team changes. A couple of weeks prior to it, URBF also published their 10-Q for the quarter ended April 30. It too is quite underwhelming, unfortunately:
- cash: $41 thousand
- current assets: $243 thousand
- current liabilities: $1 million
- revenue: $17 thousand
- net loss: $574 thousand
In July, the company told us that Horst Hueniken, the new CEO, has set himself the task of improving URBF‘s financial performance and the figures above show that he’s got his work cut out for him. The balance sheet is not much to look at, but, perhaps more worryingly, the sales, though growing, are still excruciatingly slow. People now reckon, however, that this is about to change.
A couple of videos taken from the news segments of two TV channels appeared recently. As you might have guessed already, they cover URBF and their growing facility in Quebec. The exposure alone certainly helped the ticker draw some attention to itself. The volumes over the last few weeks have been way above average and, in typical URBF fashion, the stock has experienced a few exciting jumps and drops. On Friday, it failed to go anywhere, but the dollar volume of more than $100 thousand and the excitement around the message boards suggest that we could see some more interesting sessions in the near future.
Investors might just have one or two things to be excited about. During the videos we mentioned a few moments ago, URBF showed their new machine which is much bigger than the ones they’re currently using and should, Mr. Hueniken said, lead the company into profitability.
That will undoubtedly be brilliant news for the shareholders, but people should be careful not to get too excited. After all, it will be a while before we learn whether the profitability projections have been correct, and in the meantime there is some toxic debt that might put a spanner in the works. More specifically, there’s at least $308 thousand worth of notes and debentures that are convertible into common stock at discounts ranging from 30% to 35% to the market price.
