Celsius Holdings Inc (CELH)

[Toxic Avenger]

Since their decision to delist a year ago (see below), the company has been holding revenues, costs and losses fairly constant at about $500k/quarter.
http://www.google.com/finance?q=PINK:CELH&fstype=ii

The biggest problem I see is that they have about $4.5 million in net liabilities, principally to CDS, who is also their largest shareholder. When the CDS loan was created, it was due this month and secured by all the assets of the company, which suggests that CDS could take over whenever they wanted. Even if they extend the loan term, the overhang remains as they owe $5 million to CDS.

Just to get to breakeven, they'll need to increase sales about 60%, to about $4 million/quarter (assuming they can hold gross margins to the roughly 33% they're at). They have to do that while paying for the new PR, spokesperson and IR. They'll also have to do that while reducing the larger outlets and increasing the number of smaller outlets like fitness centers, per their recent strategy shift. That will likely trade some slotting fees and other costs to distribution costs.

http://www.bizjournals.com/southflorida/news/2011/05/11/celsius-announces-q1-to-delist-stock.html
Celsius announces Q1 results, to delist stock
South Florida Business Journal
Date: Wednesday, May 11, 2011, 9:10am EDT
Celsius Holdings managed to stem some of the bleeding in the first quarter.
The Delray Beach-based energy beverage company reported a loss of $460,000, or 2 cents a share, for the quarter ended March 31, improved from a loss of $5.9 million, or 40 cents a share, in the prior-year period.
Revenue for the first quarter fell to $2.2 million from $2.3 million.
In December, the company (OTCQB: CELH) announced plans to leave the NASDAQ after it was unable to regain compliance with the minimum stockholders’ equity requirement for continued listing. It moved to trading on the Over-the-Counter Bulletin Board in January.
On Tuesday, the company said it planned to deregister completely as a reporting company.
“The company believes that, given its downsized level of operations, it is in the best interests of its shareholders not to incur the expenses associated with being a reporting company,” Celsius said in a news release.
The company's shares and warrants will continue to trade in the over-the-counter market following deregistration.
Celsius has been struggling financially for quite some time.
In July, Delray Beach entrepreneur Carl DeSantis, who started investing in the company in 2008, agreed to give Celsius a $3 million line of credit to boost its advertising campaign.
Shares closed Tuesday at 29 cents. The 52-week high was $3.34 on May 11, 2010. The 52-week low was 20 cents on Tuesday.