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Global Petroleum’s shares experienced a sharp fall of 37% on Friday following the company’s announcement of its urgent need for funds through share placing. The announcement led to a significant drop in the share price from 0.04 pence to 0.07 pence. The AIM-listed energy company, which currently holds no external debt and had cash balances amounting to just $376,000 as of Monday, expressed the need for these funds to cover upcoming license payments and other commitments.
The company’s financial difficulties have been further amplified by its pretax loss of $1.3 million for the year ended June 30. This figure reflects a slight improvement from the previous year’s loss of $1.6 million. This aligns with an InvestingPro Tip which indicates that the company hasn’t been profitable over the last 12 months. Yet, there’s a silver lining as analysts predict the company will be profitable this year, another insight from InvestingPro Tips.
In an effort to conserve cash during this challenging period, the directors are deferring their salaries and fees. Meanwhile, the company is exploring strategic alternatives with the aim of maximizing shareholder value. This strategy might be influenced by the fact that the management has been aggressively buying back shares, as suggested by InvestingPro Tips.
InvestingPro’s real-time metrics provide additional context. The company’s market capitalization stands at $9.93 billion, with a P/E ratio of 50.63. Despite the company’s recent struggles, it has shown a revenue growth of 65.31% and a gross profit margin of 74.72%. However, the stock is trading near its 52-week low, a fact that potential investors should consider.
For those interested in more detailed analysis and tips, InvestingPro offers a range of additional insights. These include information on the company’s expected net income growth, anticipated sales decline, price volatility, and dividend payment history. For access to these and many more tips, consider subscribing to the InvestingPro service.
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