The earnings for the treatment center will mean little to Ethema Health (GRST) by the end of Q2 according to the March 1st press release. The company tries to be clever by the use of the phrase "only non-real property debt" to suggest that they are retiring a lot of debt which isn't true relative to the total. They have a lot of convertible debt and I doubt that handing over the assets even covers what is secured by assets. The real investors will end up with the treatment center but it isn't throwing off a lot of cash flow and it is operating on leased property. I believe the problem for over a year now is that they aren't able to get deals with their debt holders that makes it practical for the company to continue as a going concern.
According to the annual, the Leon's are owed $2.7 million and the series "N" note holders more than $4 million with accrued interest. I don't understand how the company continues to borrow against earnings to pay the payments on that single ever increasing bill if they are to lose their performing assets. One thing is for certain, they need retail to step up and donate heavily and that just isn't happening in this market. Ethema Extends Dates for Debt Repayment and Real Estate Closing March 01, 2023 08:00 ET | Source: Ethema Health Corporation https://www.globenewswire.com/en/news-release/2023/03/01/2618141/0/en/Ethema-Extends-Dates-for-Debt-Repayment-and-Real-Estate-Closing.html
This will help clean up the balance sheet and together with our current efforts we expect that only the Series N convertible notes and the shareholder advances to my family will remain as the only non-real property debt by the end of the second quarter this year.”
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