American Nano Silicon Technology, Inc (fka ANNO)

[Acorns]

December 2010 quarter results are now out. ANNO produces its quarterly results about1.5 months after every quarter, excellent work, well done!

http://biz.yahoo.com/e/110217/anno.ob10-q.html

Sales are down on the previous quarter as production had to be halted in October for essential maintenance. They have an adjustment to reflect differing prices for their share warrants, which is a little unusual. It has no effect on the cash flow.

Net Working Capital is back in the black, after the 1.6m deficiency in the previous quarter. However Cash and Bank balances are minimal, as every cent earned is going towards towards construction costs. About $1 m has been advanced to suppliers for construction work in this quarter.

$3.5 m is needed to complete construction of the new production line. As they seem to be generating about $1.5 m cash flow each quarter, this could be complete by their year end, 30 September, without the need to raise funds by a share placement. They have increased the production line to 41,500 tons pa, which suggests that capacity may go up further as construction of the new production line nears completion.

About $2 m long term loans are due for repayment in 2012 and 2013. So ANNO could be in trouble if the completion of the new line drifts into 2012. But if they get it right, they could be generating debt free cash by the middle of 2012.