IJM

The following news article was posted by Dow Jones news:

• IJM 1Q Loss MYR746.9M VS Net MYR54.3M
  
  KUALA LUMPUR (Dow Jones)--IJM Corp. Bhd (3336.KU) Wednesday posted a net loss in the first quarter ended June 30 due to a one-off impairment expense of MYR922.3 million.
  
  The diversified infrastructure and construction company had a net loss of MYR746.9 million, turning from a net profit of MYR54.3 million a year earlier.
  
  The expense represents a goodwill payment made for its Road Builder Holdings Bhd. purchase in the quarter.
  
  First-quarter revenue more than doubled to MYR1.11 billion from MYR518.0 million a year earlier, due to greater construction and infrastructure revenue from Road Builder as well as higher income from its plantations unit.
  
  For the current financial year ending March 31, 2008, IJM said it expects its prospects to be "further buoyed by additional revenue and profit sources" from Road Builder's tolling and port operations.
  
  It added that it expects to "record better operating performance for the current financial year" from construction project opportunities opened up by the implementation of the Ninth Malaysia Plan, a national blue print for development.

It explains that IJM posted the loss due to the one-off impairment expense.

Now take a look at this Business Times Article.

• IJM operational profit soars
  
  August 30 2007
  
  BUILDER IJM Corp Bhd's first-quarter operational profit jumped more than 2.5 times as it booked earnings from the Road Builder group, a smaller rival that it recently bought.Do
  
  In October 2006, IJM launched the biggest takeover bid in Malaysia's construction history by offering to buy all of Road Builder (M) Holdings Bhd's assets and liabilities for RM1.56 billion. By April 2, IJM completed the acquisition.
  
  However, IJM's bottom line shows a net loss of RM747 million for the quarter to June 30. This is because it had to account for goodwill, the excess amount paid over an asset's value, in the Road Builder deal.
  
  Managing director Datuk Krishnan Tan assured investors that its accounts won't be hit by further accounting treatments.
  
  "We have to be prudent. Investors can be assured that this merger goodwill is a one-off accounting issue, it is a book entry. It does not, in any way, affect the group's future earnings or operational strengths," he told Business Times in an interview yesterday.
  
  Buoyed by healthy number of projects booked in its orderbook and favourable palm oil prices, IJM's first-quarter operational profits jumped to RM228.34 million.
  
  The group's infrastructure division marked significant improvement when it received maiden profit contributions from Road Builder's New Pantai Expressway, Besraya and port concessions.

Firstly, it was nice to hear that IJM boss wants to be prudent, ""We have to be prudent. Investors can be assured that this merger goodwill is a one-off accounting issue, it is a book entry. It does not, in any way, affect the group's future earnings or operational strengths"

My issue, aren't you simply baffled by the rather misleading header "IJM operational profit soars"??

Oh, by the way, that goodwill thingy

• However, IJM's bottom line shows a net loss of RM747 million for the quarter to June 30. This is because it had to account for goodwill, the excess amount paid over an asset's value, in the Road Builder deal.

This goodwill or the excess amount paid over an asset's value of 922.3 million, isn't this amount staggering?