A few points. Not all perceived negatives are negatives.
Revenues down?
Let's remember that although they closed the locations in March, the virus started affecting restaurants in February. Yes, revenues are down, but they were expected to be.
Dilution up?
Most of that was due to two things. Ben converting back to common from preferred shares, even though he had common shares tied up years ago and growth was the same with the debt.
There is good debt and bad debt and yes they added 250k in debt, but for whom and for what? Looking at the list, it went to JRF and Rogen, who appeared to both be involved in the Tucson location. Looks to me like they finally started Tucson, and the investors put the money in to finance it. Something some have said would never happen, but now that it has we hear it is bad because it happened?
So they get debt for the build out, the debt goes up by 250k or maybe twice that, and that proves another thing Roger said is true: investors get the debt like a bank and the location becomes corporate owned. Amfil has a debt, but also will start generating another $2M to $3M in revenues from the new location, and even with profits since the cafes appear to now be generating profits. Heck, if they took on $509k in debt for every location, and did the 10 locations they say they would work on, that is $5 million in debt to gain revenue of $20 million to $30 million a year. That is what growth is all about.
They don't have the money to open 10 locations by themselves, so they borrow money, build corporate locations that show all the revenues, not a small portion like some guessed, and they keep expanding, just like announced. Yet, some try to say is not true. Tempe is corporate owned. Tucson is corporate owned. Others will be corporate owned, financed by investors instead of banks, but that is still financing, and that is good debt in my book. So yes, debt is up, but for good reasons. And for those who say JRF already bailed and Rogen has or is about to bail, gee, look who the investors were that did the debt in January 2020. So no, not bailed, but investing more apparently.
Personally, I like what I read, given the virus and why some negative categories went up in numbers for expansion, growth, and the future. That's what I am focused on...
$FUNN
