9.23%, while its traded volume rose over 6 million shares for a day.The most interesting thing about IDC is that it hasn’t published any news about its activities since the beginning of October, when the company announced its new one-gallon stand-up pouch featuring The Answer®, IDC’s proprietary dispensing technology. However, since that time there is no information about IDC’s business. Looks like that’s the main reason for traders’ disappointment and they seem to find no sense to keep their shares.
International Dispensing Corporation is a research and development company that develops, manufactures, and licenses dispensing solutions for the packaging and food service industries. According to its 10-Q report, the management of IDC has secured $840 thousand in equity financing in September this year. A month before, the company announced the signing of a global strategic sales alliance with Power Packaging, though IDC warns that it “may be involved in litigation and other legal proceedings from time to time in the ordinary course of business”.[BANNER]
As of end-September the company’s revenues have increased due to its new stand-up pouch, however, IDC has experienced continuing net losses and negative cash flows from operations. Besides, the liabilities of IDC are higher than its total assets and the company has accumulated deficit of approximately $42 million. Having in mind the huge net loss and the bank line of credit, we may assume that IDC doesn’t have enough cash to pay its liabilities.
The company believes that it has sufficient capital and access to funding to continue operations till the end of this year. However, its financial report states that “The Company’s continuing existence is dependent upon its ability to obtain additional financing, to generate sufficient cash flows to meet its obligations on a timely basis and to achieve and maintain profitable operations”. In the meantime, IDC continues operation as a going concern attempting to obtain additional contracts, though, there can be no assurance their efforts will be successful.
