Tuesday, March 30, 2010

A Look At Analabs Earnings

I wrote about Analabs back in 2007: Analabs

Analabs reported its earnings last night.

It made some 5.639 million for the quarter and giving it a nice 11.365 million for its 3 quarters earnings this fiscal year.

Its impressive when you compare to the posting made in 2007.



Here are the links to its quarterly earnings for its current fiscal year.

Dec 2009: Quarterly rpt on consolidated results for the financial period ended 31/10/2009. Analabs made some 3.816 million.

Sep 2009: Quarterly rpt on consolidated results for the financial period ended 31/7/2009. Analabs made some 1.910 million.

The jump in its q-q earnings has been very impressive this year.

So why am I posting about this stock?

Well, I had not been positive on this stock before. See the series of postings made here. So this posting is like giving credit when credit is due. :D

For example, some of comments back in 2007 were..

  • 1. Current 9 months profit = 6.409 mil. Numb shares = 60.024. so eps = 10.7 sen.

    2. Analabs last 4 years had been very poor. from fy 2003 onwards: 2.125, 3.299, 4313 and 2.7 mil. Ok on first hand it doesn't look bad, but fy 2002 it was 9.571 mil.. market expectations back in fy 2002 was around 10 mil per year. And to make it worse, it was supposed to earn around 14 mil for fy 2002. And adding more salt, before listing it made 16 mil for fy 2001! And there were

    In short, it's earnings has been really terrible.

    3. Company dabbles in the share market. The current profit of 6.409 mil is boosted by disposal of securities, which saw Analabs gaining 1.116 mil this fiscal year.

    4. Cash balance is extremely healthy, so is the cash flow.

    So main issue for me... is how competitive is Analabs business?

    rgds
And



  • James wrote:
    I know nuts about recycling, though I hear it is kind of a lucrative business.

    I would actually expect things to have gone from bad to worse from 2002 onwards but looking into the balance sheet and cash flow, they seem to be turning the corner. Relative to many speculative companies out there, the share price is mainly backed by cash.


    Hello James,

    Yes, it has been noted right at the start that its cash balances and cash flow is extremely healthy.

    However... because of what happened since listing... Analabs now runs the risk of creating a negative perspective amongst the investing community.

    See, many believes in protecting one's good name. No?

    And I am afraid that Analabs has fared rather poorly here. Simple reasoning it simply failed to deliver. Before listing there was so much hype surrounding Analab pre-listing growth. Most investment research house went goo-ga over it during listing. After listing, it continued to disappoint and disappoint and as mentioned, it got to the point where many has dropped coverage on this stock. So despite its apparent turnaround, Analabs now has been shunned by the market and the investment community.

    Now perhaps the market is wrong here. There certainly could be value in investing in the company. However, if the market and the investment community do not re-rate this stock, the investor could run the risk of investing in a stock that is shunned by the market.

    See this is where it get extremely tricky.

    One one hand, there is nothing wrong in such a strategy but the investor has got to ask themselves a logical question: Are they willing to invest in a stock that is ignored by the market? And if this scenario persist for a long time, in a hot market, the feeling of seeing one investment not producing could be damaging for one sole.

    However, on the other hand, the argument is that good stocks will not be ignored forever. Sooner or later the market will discover the jewel inside the stock. Question is, is the investor willing to wait?

    hope these opinions helps,

    rgds

Oh yeah, back in 2007, Analabs were around 80 sen. Yeah, and I did state I would not buy it back then. :D

Anyway, here is the company's balance sheet.


Some comments:

1. Investment in equity securities. Yet another company again making such investments. Sigh.
2. Cash balances shrunk. ( See cash flow statement below)
3. Receivables increased.


There is the massive 32 million purchase of listed subsidiary! oO

Oh if one was an investor of Analabs, this was acquisition was old news. Back in july 2009, ANALABS RESOURCES BERHAD (“ANALABS” OR THE “COMPANY”) - PROPOSED ACQUISITION OF 100% EQUITY INTEREST IN COVERIGHT SURFACES MALAYSIA SDN BHD FOR A CASH CONSIDERATION OF RM40.0 MILLION (‘PROPOSED ACQUISITION”)

And you read all about Coveright in the pdf file atteched here.

The current segmental earnings shows that Analabs is no longer dependant on recycled products.





And this is what the company has to say.
  • 1. Review of the Performance

    For the quarter under review, the Group recorded a revenue of RM38.4 million, which is an increase of 214% compared to the revenue of the corresponding quarter of the preceding year. This increase was contributed by the newly acquired business of manufacturing and sale of resin impregnated papers by RM27.4 million but was set-off by the lower contribution from the other business segments due to the weak prevailing operating environment vis-à-vis the corresponding quarter of the preceding year. The newly acquired business recorded a sales volume growth of 59% in comparison with the immediate preceding quarter.

    As a result of the positive and substantial contribution in turnover mainly from the business of manufacturing and sale of resin impregnated papers and relatively lower raw material prices, profit before tax for the current quarter recorded an increase of 223% as compared to the corresponding quarter of the preceding year.



How?

Just giving credit when credit is due.

And seriously, I have no idea on how this stock would perform.

*************
Analabs was UP all morning. It last traded at 1.39! up 13 sen!

3 comments:

TH said...

This is a stupid china man company run by a heartless useless man who thinks that everyone owes him.

Asks his staff to gather every Saturday morning and hear his crap / preaching about how his philosophy and about his trips with his few favourites to other countries. Come on lah you enjoy never take people somemore want to talk shit. Anyway, you are going to get your repayment soon enough for all the "good stuff" that you have done.

I was an ex staff (only 7 days), if he felt like he didn't like you immediately ask you to leave.

So let this be a warning to anyone who wants to work there, DON'T, if you do its your funeral.

hhc1977 said...

yo,

good work. It's always nice to hear some good news on bursa rather than those bad news..

Moolah said...

hhc1977: yo! no visit sahamas lately? :D