Friday, February 24, 2006

Confusing financial headlines

I really do not understand some of the financial headlines in our newspaper.

For example, take this title of this article posted in the Edge Daily:
Esso's net profit surges 80.58% in FY05

For me, before I clicked on the link, I thought Esso Malaysia Bhd must have had a hell of a year for its FY 2005.

Correct or not?

Net profit surges 80.58% screamed the headline!

Here is the snippet of the article.

  • Esso's net profit surges 80.58% in FY05 By Ashwin Raman
    Esso Malaysia Bhd recorded an 80.58% increase in net profit to RM19.72 million for the financial year ended Dec 31, 2005 (FY05) from RM10.92 million a year earlier.
    In a statement on Feb 23, it said revenue for FY05 increased 33.44% to RM8.26 billion from RM6.19 billion in FY04, as a result of higher product prices.
    During the fourth quarter however, its net loss widened to RM8.68 million compared with RM2.5 million a year earlier.
    It said that during the fourth quarter 2005, prices reversed the upward trend seen over the first nine months of the year
Ahh... aren't we confused yet?

The title suggests that Esso Malaysia had a fantastic fy 2005.

However... in its fourth quarter ... ESSO reported a net loss of rm8.68 million.

Don't you agree that perhaps the reporter could have given a much better title for this article?

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