Notes & Reviews

Financial Expert Commentary

• •Liquidity compression is the primary near-term concern. Cash coverage has declined from 4.2 months to 2.8 months over the past quarter.
• •Gross margin improvement of 0.4% this week is encouraging, but supplier cost pressures remain a headwind for Q2.
• •AR aging requires attention. Three accounts (totaling $340K) are past 60-day terms and should be escalated to collections.
• •Inventory velocity has improved to 7.2x, indicating strong sell-through. Continue monitoring SKU-level performance.
• •EBITDA compression of 0.5% is within acceptable range given strategic marketing investment for spring campaign.
• •Working capital position remains stable despite seasonal inventory build. No immediate concerns.
• •Recommend evaluating short-term credit facility to maintain 4+ month liquidity buffer as safety net.
• •Pricing strategy review is critical to offset anticipated supplier cost increases of 1.5-2% over next 90 days.