Electronic Cigarettes Intl Group Ltd (OTCMKTS:ECIG) once again picked up in Tuesday’s trading session. The rally that commenced two weeks ago is taking pace. The shares surged more than 24% to close at $0.174.
The number game
Electronics Cigarettes profile cannot be termed as the profile of the typical penny stock company. It not only has an innovative and real product offering but also functions in a growing industry. The company is reporting sizeable revenues.
For the quarter ended September 2014, Electronic Cigarettes reported cash of $4.3 million, total current assets at $28.8 million and total current liabilities were $69million. Also, it was able to report positive net income that came at $41.1 million. For the quarter ended September 2014, the revenue surged to $15.9 million compared to $833,000, a year ago. Electronic Cigarette reported revenue of $31 million for the first three-quarters of FY2014.
The problems of debt
Electronic Cigarettes Intl Group Ltd (OTCMKTS:ECIG) posted strong financial results, but its balance sheet shows high outstanding debt. The company failed to list on the NASDAQ platform following that the investors who held outstanding notes started converting them into discounted shares. It resulted in a sharp drop in company’s share price.
The share price of ECIG dropped down to record level of 3 cents from a high of $4. The total number of outstanding shares jumped to over 250 million at the start of the year. The figure stood at 82 million in last November. From thereon, the management of Electronic Cigarettes has been announcing several measures to reduce the debt in books.
Electronic Cigarettes Intl Group Ltd (OTCMKTS:ECIG) last month announced a deal that has been made with 85%of the holders. It will extend the duration by another eighteen months. The company operates in a rowing industry. As per a report, teenagers are using electronic cigarettes at a much higher rate. The number of students in high-school who tried an e-cigarette in last thirty days came at 4.5%.