Critical comments on Inderes’ analysis report are as follows:
- Today’s analysis from Inderes completely overlooks the €19 million in liquidity + cash highlighted in Boreo’s Q1 report, which provides the opportunity mentioned in the release to continue selected add-on acquisitions, as stated yesterday in the earnings release as well as in both the Inderes and Redeye interviews.
- The statement at the end of the report that “the ability to make acquisitions is currently limited” is pessimistic and backward-looking; it fails to account for the strong liquidity position described by the company in yesterday’s earnings release and the Inderes and Redeye interviews.
These are very unfortunate shortcomings, and for these reasons, Inderes’ narrative is incomplete and backward-looking. Investor returns, however, depend on future performance. Personally, I have more faith in the narrative of Boreo’s Head of M&A; below are copies of the relevant Q&A transcript sections:
Q: How do you view the financial stability, especially with hybrid debt not classified as debt in your reporting? A: Rafael Kosmonov, Head of M&A and Financing: We have a good cash flow and expect to decrease leverage this year. Our liquidity position is strong, and we have full support from financial partners.
Q: You talk about both accelerating M&A activities and strengthening the balance sheet. Can you describe that dynamic? A: Rafael Kosmonov, Head of M&A and Financing: We are paying down debt and exploring financing alternatives. We aim to make small add-on acquisitions now and larger ones as our balance sheet strengthens. We are building a pipeline of potential targets to be selective.