Skullcandy’s Revised Form S-1 Reviewed

by The Editors on May 5, 2011

Skullcandy-TmMarket Watch’s Jeff Harbaugh was wondering what happened to the Skullcandy IPO and did some nosing around. He discovered that on April 30, 2011 Skullcandy filed a revised form S-1 with the SEC. In his latest column he looks into exactly what changed and what it might mean to the company and it’s potential public offering. He says:

Skullcandy is counting on the success of its IPO to reduce its leverage and give it the working capital it needs to execute on its plan. Shareholders and executives have taken a bunch of cash out of the company in the fourth quarter, resulting in a big loss. They were entitled to do that under existing agreements, but how does it look to a potential stock purchaser? Those potential investors also see a company whose 2008 net income of $13 million fell to $3.5 million in 2009 even as sales grew 47% to $118 million. Now, on sales of $160 million, there’s a loss of almost $10 million.

For Harbaugh’s conclusions (and some interesting reading), click the link.

[Link: Market Watch]

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