(14-08-2013, 03:31 PM)GFG Wrote: [ -> ] (14-08-2013, 12:45 PM)guitarist Wrote: [ -> ]This blogger has a different CCC number.
http://www.investmentmoats.com/money-man...situation/
Oh his CCC number is yearly, not the latest FY14Q1
The annualised CCC figure is given in the AR / media release usually.
Like I said, its not something that can be calculated from the financial statements
Actually if you take all sales as credit sales (Which is not illogical, I dun think cash upfront is significant in the manufacturing business), you can get a conservative ccc figure. Its not accurate, but you roughly get a conservative CCC figure, I do it for namlee
http://www.investopedia.com/terms/c/cash...ncycle.asp
yes i am not using the latest quarter one. also note that i add up the payables and Accruals, other payables and deposits received so you can say its more payables.
NTL:
It's just another way of looking at it. My purpose was to see how much of accounting revenue was in cash receipt (inflow) and how much of accounting COGS was in cash payment (outflow). So in 1Q14, they recognized HKD611mln in accounting revenue but at least HKD126mln (21% of 1Q14 revenue) was not in cash receipt since this was the difference (or addition) in A/R. Inherently, I am assuming the company did not manage to collect any of their prior receivables. But if they do, then the figure will be more than HKD126mln.
You do the same for A/P and you realize the amount is even higher. Given the inherent assumption is a little unrealistic so it means they did not pay their supplier by quite a far bit!
But to simplify it: Higher CFO in 1Q14 was driven largely by a lesser need for working capital investment. You can see this clearly under CFO Statement. Is this a structural change or is this one-off? Your guess is as good as mine but to be conservative, I would reckon it is the latter. To be fair, Valuetronic is safe even if working capital investment normalizes since they are holding on to so much cash.
GFG:
You can work it out from the financials through an estimate by using the sales turnover approach or simply CCC = DIO + DSO - DPO [Greenrookie has paste a very useful link on it.]
The number will vary depending on the method of calculation. Variations arise from the following:
[1] how you/mgmt define receivables or payables. To be prudent, you should use every relevant working capital item on the current assets & liabilities segment which was what Drizzt mentioned.
[2] whether you average out the denominator for your sales turnover [i.e. average from beginning and ending period]. This smooths out the volatility.
[3] some might just use sales for all the numerators but there is a strong discrepancy for high gross margin business since COGS is around half of sales (if you know what I mean). I use sales for DSO and COGS for DIO and DPO since this is how the accounting mechanism works.
Ultimately, the key lies in standardizing your method of calculation. You want pick up any distinct trend over the past few years.
(14-08-2013, 06:54 PM)dzwm87 Wrote: [ -> ]NTL:
It's just another way of looking at it. My purpose was to see how much of accounting revenue was in cash receipt (inflow) and how much of accounting COGS was in cash payment (outflow). So in 1Q14, they recognized HKD611mln in accounting revenue but at least HKD126mln (21% of 1Q14 revenue) was not in cash receipt since this was the difference (or addition) in A/R. Inherently, I am assuming the company did not manage to collect any of their prior receivables. But if they do, then the figure will be more than HKD126mln.
You do the same for A/P and you realize the amount is even higher. Given the inherent assumption is a little unrealistic so it means they did not pay their supplier by quite a far bit!
But to simplify it: Higher CFO in 1Q14 was driven largely by a lesser need for working capital investment. You can see this clearly under CFO Statement. Is this a structural change or is this one-off? Your guess is as good as mine but to be conservative, I would reckon it is the latter. To be fair, Valuetronic is safe even if working capital investment normalizes since they are holding on to so much cash.
GFG:
You can work it out from the financials through an estimate by using the sales turnover approach or simply CCC = DIO + DSO - DPO [Greenrookie has paste a very useful link on it.]
The number will vary depending on the method of calculation. Variations arise from the following:
[1] how you/mgmt define receivables or payables. To be prudent, you should use every relevant working capital item on the current assets & liabilities segment which was what Drizzt mentioned.
[2] whether you average out the denominator for your sales turnover [i.e. average from beginning and ending period]. This smooths out the volatility.
[3] some might just use sales for all the numerators but there is a strong discrepancy for high gross margin business since COGS is around half of sales (if you know what I mean). I use sales for DSO and COGS for DIO and DPO since this is how the accounting mechanism works.
Ultimately, the key lies in standardizing your method of calculation. You want pick up any distinct trend over the past few years.
Hi dzwm87,
Thanks for the reply. Let me chew a little bit on it. Generally I see it that you are looking more at the cashflow statement.
I noticed that for the past 3 years
management always exercise their options during the cum dividends period (refer to attached pic)
like recently they exercised their options at 10 cents+ and immediately received the 1.3 cents dividends too
you guys have any views on this? do other companies have such practices too?
also why doesn't valuetronics pay dividends more regularly like what UMS is doing? (quarterly payout)
if dividends are paid out quarterly, the management would not be able to maximize the time value of their money in the above example?
They did not really just exercise during CD. They did on other time too in Feb 2012 and Oct 2010.
Of coz, they can take advantage of the CD to take some dividend right after exercise their rights. I have no problem with that. If I have the options, I will likely do the same thing.
(19-08-2013, 10:20 PM)NTL Wrote: [ -> ]They did not really just exercise during CD. They did on other time too in Feb 2012 and Oct 2010.
Of coz, they can take advantage of the CD to take some dividend right after exercise their rights. I have no problem with that. If I have the options, I will likely do the same thing.
Yes they may have the right to do that, but it is also the right and duty of shareholders to monitor and bring up during AGM if the man looks like they r milking the company for personal gains.
I have earlier brought up my concerns about the behavior of man in terms if share options. It is a good company in terms of the financials, but there are similarly good companies with better management that look at long term share appreciation
Unless of coz share options is not given out, then they can't do anything. But if they are given, do they need to be restricted just to exercise after XD?
To be honest, one concern I am having right now is the low conversion price of the options recently given out. Wondering why are they giving out at a discount to current price? As long as the price stay around this level, they will stand to profit when they are able to exercise. I remember seen a company where the options (or is it warrants) that are priced higher than the price then. Maybe that will incentivize the management to drive up the share price? And that will benefit all shareholders?
I do not know, as I am not really familiar with all these. Look like as I understand the company better, the more negative it gets.... Well, just see how things will develop...
market seems to be pushing valuetronics closer to NAV
in recent months ran up from 20cents to 22 cents now, NAV is around 28 cents right?
I will be happy if it can hit 25 cents.