The price of Kiwibox.com, Inc. (OTC:KWIB) shares has been going up in the past several sessions, although there doesn’t seem to be any solid reason for such a movement.
Yesterday KIWB closed at $0.049, 8,89% up, after approximately 2 million shares had been traded.
In the third quarter of 2011, KIWB acquired a German social network site, Kwick!. According to KIWB, the acquired business has been cash flow positive since its inception.
The effect of the acquisition for the financial situation at KIWB is not yet clear as the financial report is not out. What is clear, is that KIWB desperately needs something positive added to its reports.[BANNER]
The latest report for the quarter ended Sept. 30, 2011 looked rather discouraging. The company had next to no cash at hand, negative working capital, reported significant losses, and it was made clear KIWB will need additional financing which would come from more debt or equity.
Unless the recent acquisition turns out to be a really huge source of income, KIWB will have to finance its operations in ways that will hurt its shareholders.
Keeping that in mind, positive market performance seems somewhat out of place. Some message board posters believe the closing of Facebook’s IPO may be fueling the positive performance of KIWB. Whatever the reason is, KIWB will have to provide some solid results, or face a serious decline.
