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Evidently the investors where impressed as the stock soared to 100/share. 😁
Where do I remember KPMG? That’s right.
They combined two of the race teams into one to save money, and that team has a title sponsor. Shuttering that team would save them what, 1-2 million dollars? Do you know how cheap that is compared to the benefit of running the #1 plate in the most viewed off-road motorsport in the world?
Just read an article in the NY Times about Austria, just like the rest of Europe the country is is shit soup.
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And PMG is the biggest turd in the pot according to their finance minister.
Put RJ on a KTM with a 1 on it. I hear what you are saying and 1-2 million isn’t much on the surface but it may buy you good will with the consumer and workers who got f’d.
At the end of the day I want to keep buying Austrian built bikes because they work great in my situation. If they never raced another major race my mind wouldn’t change about them. That’s just me and maybe I’m just selfish 😎
I assume it cost them around...$3,000,000,000. KTM is frigging STUPID to have bought Husky and Gas Gas. These 2 teams fight for a piece of the KTM pie. I doubt they do anything to the Jap bike sales of any significance at all. The same bike with 3 different colors. Brilliant. Why not make it 4 if it is such a good idea. Fugggit, make a yellow one...we'll call it Doomsday Cycles. Available for a very limited time.
Would having 1 CEO instead of 2 not be a good idea if you are really looking to save money?
I agree, I didn't really understand those acquisitions at the time but thought maybe they had a really cool plan and each brand would have it's own niche.
I hope the Husky brand ends up in good hands when all is said and done.
That's the million dollars, no sorry, the 2 billion dollars question.
No one really knows but maybe we'll know more after the next hearing. They've had some acquisitions, also buying more MV Agusta shares but that's not it. Didn't help but that's not the same order of magnitude.
I'm not sure much of it was spent at all, this happened so fast, variable rates and spiking interests could have played a significant role in this.
Stuff like taking up +573M (from 72M to 645M) current financial liabilities in 6 months "sounds" bad but I don't really speak this language so maybe not (p.14 of H1 2024 Financial report). At the same time gross profit took a 300M hit, so that's -0.9B in 6 months with just these 2 items.
p.36 "Current liabilities increased by 43.9% in the first half of the year mainly due to the taking up of short term credit and working capital lines (572.97M euros)"
What does this mean?
Not sure what that has to do with tool making.
They could sell Gasgas trials: made in Spain in a brand new factory, not competing with any KTM nor Husky bikes.
p.36 "Current liabilities increased by 43.9% in the first half of the year mainly due to the taking up of short term credit and working capital lines (572.97M euros)"
Credit can come in different forms. In this instance they drew a large chunk of their credit lines that are intended to help business float costs in the short term. Like they have to build a bunch of bikes, but there is a gap from fronting those costs until they get paid by dealers. Think of it like a credit card, it's supposed to be shorter term expenses that get paid back relatively quickly. Businesses usually have lines of credit open that they can use/pay back at will or until they request more or the bank decides they are a bad credit risk and lowers their limits. These will have variable rates though, so as rates rise it will hit these accounts quickly.
Thanks 👍
Simply put, current liabilities are things like revolving credit and anything due within a year (e.g. current portion of long term debt is the next year's scheduled loan principle repayments). So as has already been said, things like operating lines of credit. But taking on more long term debt will also increase your current liabilities as there will be more principle to repay in the next year. In general, you want your current assets to exceed your current liabilities because if they don't, that suggest that you'll have trouble meeting your debt servicing obligations.
In reality, you can have a situation where the current assets vs current liabilities ratio changes dramatically on the statements without much having changed in reality. If you violate debt covenants, long term debt can be reclassified as current since the violation gives the bank the right to call the debt. In most cases the bank would rather see the client work their way out of the situation and just keep making regularly scheduled payments (why call the debt when the client can't pay it?). But in that situation, acquiring additional financing will be next to impossible. That's where KTM is. I don't know if they've violated their covenants (I'd be astonished if they didn't), but they need cash and their financial statements are ugly so nobody will give them any. They probably went through a phase of paying debt with debt (like a person who makes credit card payments with their line of credit) and doing that can cause rapid, compounding debt inflation.
Thanks for making the effort. Won't pretend I'm 100% on this but I think I got the message. Always interesting to learn, even about a word I thought I was quite familiar with 😆
Thanks for explaining - the whole damn thing is captivating. As said before the fact the moto media is not even exploring the what ifs seems odd. I mean worst case scenario a quarter of the main gate doesn’t show for Glendale…
Some fresh news here, including about what the impact is for current racing, and after: https://m.gpone.com/en/2025/01/08/motogp/ktm-the-2025-rc16s-will-be-assembled-next-week-and-ready-for-sepang.html?
Pit Row
First, aren't the members of the race team employees also (yes). So, as in every reorganization, hard choices have to be made. Seems that a company built around competition machines needs to compete. No race team, no company, no jobs. You save the jobs you can.
PMG needs to hire DOGE
2 weeks is the manufacturing time for the mold, not the design and validation time, and yes, 2 weeks is possible.
Pierer Mobility owns the foundry, so owns the mold designs, exterior modifications to the mold designs may be needed for manufacturing on different equipment, this may require some design time.
Why? So they can hire a bunch of incompetent Indians and put the company in an even worse spot?
More like, 2 highly successful, private industry, billionaire business people who started and escalated multiple companies to being extremely profitable, were brought in to help fix a completely broken and ignorantly corrupt government that's massively deep in debt and no corrective action in sight. Time will tell in terms of how it works out, but +70 consecutive years of the same shit ain't fixing the same shit as that's a train completely off the tracks. Looks not too far off from the KTM fiasco - or at least where KTM is headed, except they aren't a government agency that can just print more money to solve their immediate problems to kick the can down the road.
Vivek is a scam artist. Go lookup how he made his money.
Anyone who works in tech hates these two morons at the moment. Go lookup their H1B stance before you spout off that they are the saviors.
https://powersportsbusiness.com/news/ktm/2025/01/09/banks-want-collater…
Bank meetings were held in December, where Pierer brass presented a plan to sell off the subsidiaries (GasGas, Husqvarna and KTM).
🤔
Yoi can just sell them. KTM bought GAS GAS name only. Not the technology. So the could sell Husqvarna and GAS GAS name and the bikes continue with different motors etc.
That's bold of CFMOTO wanting majority ownership
Leverage is a bitch
If Pierer Mobility goes bankrupt, and there is a fire sale, I can see a fight between CFMOTO and Bajaj over the brand (KTM, Husqvarna and GasGas) and distribution, I can't see them buying the Austrian plant or equipment.
Post a reply to: KTM to file for Bankruptcy/ Self Restructuring on Friday