Borislav Tonev

Icon Vapor Inc (OTCMKTS:ICNV) Attracts Investors

by Borislav Tonev March 2, 2016

In November 2014, Icon Vapor Inc (OTCMKTS:ICNV, ICNV message board) completed the acquisition of an entity called Green Tree Syndicate, Inc and about a month later, the management team rather proudly announced that thanks to its new subsidiary the company has booked more than $1 million worth of purchase orders. Daniel Balsiger, ICNV's CEO, also said that the company should be able to reach “sustainable profitability” in 2015.

Neither of these things have happened.

Some problems occurred last year and in September, ICNV's Board of Directors decided to unwind Green Tree's acquisition. As a result, ICNV was left on its own and the figures for the third quarter of 2015 show pretty definitively that it's not doing brilliantly:

  • cash: $69 thousand
  • current assets: $297 thousand
  • current liabilities: $2.5 million
  • quarterly revenues: $37 thousand
  • quarterly net loss: $6.5 million

Perhaps not surprisingly, the share price has plummeted from around $0.16 prior to the unwinding of the acquisition all the way to a 52-week low of just over $0.001 per share last week. It has managed to bounce, though.

On Friday, the ticker gained a respectable 46% and yesterday, it added another 5% which means that it's now back at $0.002 per share. Apparently, investors reckon that the stock deserves more. But does it really?

The future should give us the answer to this question. In the meantime, any investor contemplating a potential gamble with ICNV should know that at the end of September, there was more than $500 thousand worth of convertible debt outstanding. The 10-Q doesn't disclose the actual conversion terms, but it does say that on July 15, when ICNV's market price was hovering between $0.18 and $0.22, the company issued some shares at $0.06 a pop in order to satisfy notes.

There's quite a lot of speculation around the presence or absence of dilution at the moment, but there is absolutely no official information on the current share structure. That should be yet another reason to tread carefully.

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