Avid Bioservices Inc (CDMO)

[Protector]

coporal, nobody said dividends are deductible. I see now why you claim PPHM will never pay dividends, it looks like you don't know what dividends are or are mistaken them for something else.

Then again it makes me understand why you said PPHM would never pay dividends. Here is how it works FYI:

Companies make losses and accumulate tax advantages due to it. They invest and actually cannot write everything down because the income to write it down on is insufficiently high. Particularly for small cap biotech that raise money from the market (e.g. ATM) that DOES NOT COUNT AS INCOME for the RIS in a same way as Avid profits do, leaves them with a LOT of tax advantages.

In the case of PPHM 500Mil$

Once PPHM starts making profits in a sustained way, announced for about 12 months from now, the profits are lowered by the tax advantages. Assume Avid has 30Mil$ profits after ALL PPHM cost and everything is paid (profits BEFORE TAXES) then in staid of paying, say 33%, taxes on 30 Mil$ (10 Mil$), they pay nothing and put 10Mil$ on the bank in stead. The 500Mil$ tax advantages now become 470Mil$ tax advantages and so on.
Of course they also keep the 20mil$ other profits.

If the tax advantages are ZERO and PPHM makes 100Mil$ with avid at that moment (before taxes) then they will pay, say again at 33%, 33Mil$ taxes and keep the 77Mil$ other taxes.

When a company has profit and wrote down all its tax advantages from the past it is allow to pay dividend. So PPHM could decide to pay 30Mil$ dividend, assuming 300Mil$ outstanding shares that would be 10 cent per share.

A person with 100.000 shares would receive 10.000$ Dividends that year. A company can also pay dividends quarterly if they want. At 10 cents yearly that will not be done, but if profits grow quarterly payments will also become a good options.

PPHM WILL PAY DIVIDENDS WHEN THE PROFITS ARE THERE!