Deswell announced its 4Q results last Wednesday. The numbers were in-line with my expectations. The balance sheet reflects a little bit of cash burn coupled with a reduction in receivables and inventory. We can also see that there was a reduction in PP&E [Property, Plant & Equipment], reflecting depreciation, but we should remember that the PP&E is booked at cost and doesn’t reflect appreciation on the underlying real estate. Current liabilities decreased by quite a bit to offset a lot of the shrinkage on the assets side. On these new numbers, once again not adjusting for real estate appreciation, my liquidation value calculation is roughly $3.64.
Disclosure: Long DSWL