Momentum carries CLI to all-time highs despite cash burn on operations

Recently Cebu Landmasters (CLI) has been trading at 7.27 a share near it 52-week high and all-time high of 7.33.

The buoyant share price belies the cash burn on operating activities. In the first quarter of 2021, CLI burned 663 Million of cash on operating activities. CLI burning cash on operations, capital expenditures on investment properties was only at 147 Million Pesos. It then borrowed money to pay interest and principal on its loans and to add a little cash on its balance sheet.

Cash as of the end of the first quarter of 2021 was 986.7 Million Pesos while interest bearing loans and borrowings due in the current period stood at 4.5 Billion Pesos. If operating activities will continue to burn cash in the coming periods, CLI will have to borrow to refinance its current debts.

Project pipeline such as the Ming-Mori reclamations project provides fuel to CLI’s share price momentum.

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