tag:blogger.com,1999:blog-2559260500579382213.post5465399191157901789..comments2024-03-23T13:18:17.693-05:00Comments on Anybody Want A Peanut?: Hydro's current ratiocherenkovhttp://www.blogger.com/profile/15355986781478585611noreply@blogger.comBlogger6125tag:blogger.com,1999:blog-2559260500579382213.post-59750668501723161982012-09-06T22:57:10.327-05:002012-09-06T22:57:10.327-05:00As noted, it's only a quarterly report, but wh...As noted, it's only a quarterly report, but why would they have large sums for capital projects in the current asset line unless it was just transferred into that section the previous quarter a year ago. <br /><br />If Hydro was holding sums of money in reserve for capital construction, I would expect that to be shown as either other assets or a restricted fund (liability)Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2559260500579382213.post-88966298529119003992012-09-06T22:12:51.232-05:002012-09-06T22:12:51.232-05:00Brian G: Thanks for the insight. I was looking at ...Brian G: Thanks for the insight. I was looking at the cash flow too, in particular the decrease in cash from financing activities. Wasn't sure what to make of it. Did Hydro stop selling Hydro Bonds?<br /><br />Brian K: Perhaps, except everything at Hydro is long term. Their capital expenditures are long term. The entire budget of Wuskwatim was $1.3 billion, but their cash flow decreased by almost half that much in the last year alone. I think there is something else at work here.cherenkovhttps://www.blogger.com/profile/15355986781478585611noreply@blogger.comtag:blogger.com,1999:blog-2559260500579382213.post-38154783096420906572012-09-06T16:02:06.285-05:002012-09-06T16:02:06.285-05:00One likely explanation is of they had large sums h...One likely explanation is of they had large sums held in reserve for future capital spending and then purged through those in the last year.Brianhttp://www.stateofthecity.canoreply@blogger.comtag:blogger.com,1999:blog-2559260500579382213.post-45984729231910403842012-09-06T10:35:46.478-05:002012-09-06T10:35:46.478-05:00Just a further disclaimer that there may be timing...Just a further disclaimer that there may be timing issues at play here, since it is only a quarterly report that I looked at. Generally though, numbers should be comparable.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2559260500579382213.post-8918805030227647842012-09-06T10:33:47.432-05:002012-09-06T10:33:47.432-05:00Generally your current assets would be turned into...Generally your current assets would be turned into expenses to generate profit (think using cash to buy inventory, or prepaid expenses being used), so there are several reasons why the current ratio could degrade like it did. It would be less of an issue though if we saw an increase in revenue over the previous year, but we don’t.<br /><br />What screams at me though isn’t the degradation in the current ratio, but rather the decrease in cash flow which is shown further down. The cash flow drops from $611M to just $73, or a decrease of 88%!!!<br /><br />Couple that with the decrease in current assets, and that the rest of the balance sheet seems static, what I conclude is this is the first thing to happen when you aren’t generating enough funds to run your business. Next year will be interesting – will we see a further decrease in current assets? Will Hydro start liquidating Long-term and Capital assets to pay the bills? Or will we see an increase in current liabilities ( simply put – NOT paying their bills)<br /><br />Makes one wonder why Hydro is set on major capital expenditures ( BiPole, Wuskwatim), when they don’t appear to be in a financial position to be able to do it – Seems like Black Rod is right on this one.<br /><br />*Oh, and I AM an accountant.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-2559260500579382213.post-22220410058687166442012-09-06T00:50:10.315-05:002012-09-06T00:50:10.315-05:00Unfortunatly Hydro seems to be the NDPs piggy bank...Unfortunatly Hydro seems to be the NDPs piggy bank. Until we get spending under control the government will continue to plunder Hydro (and other profitable crown corps) into the red.Anonymousnoreply@blogger.com