Pintaras Jaya III

Published on Business Times: Pintaras Q3 net profit surges 62pc

• PINTARAS Jaya Bhd's third-quarter net profit surged 62 per cent due to better contribution from its construction and manufacturing divisions.
  
  It expects to report good numbers for the fourth quarter due to its outstanding orders.
  
  However, it cautions that profit could be hurt by rising costs steel. Pintaras made a net profit of RM7.6 million for the quarter to March 31 2007. Revenue was up 22 per cent to RM44.3 million.

Since I had written on Pintaras Jaya before and I do keep track of this stock, I was confused by that news clip. Was it that good?

Here is the snapshot from Dow Jones News Clip.

And here is my compiled data of Pintaras Jaya.

As can be seen, Pintaras Jaya earnings was decent but it did not surged 62%!!

I wonder where Business Times got that set of information!

The following notes were taken from Pintaras earnings notes:

• For the nine months ended 31 March 2008, the Group's revenue increased by 2% to RM119.3 million from RM116.9 million in the preceding year, while profit before taxation grew by 20% to RM28.7 million from RM24.0 million for the respective period. The improvement is mainly attributable to higher contribution by the construction and manufacturing divisions.
  
  The construction division recorded a lower revenue of RM88.1 million compared to RM89.1 million last year. Despite the decline in revenue, profit before taxation increased by RM6.3 million or 41% to RM21.9 million from RM15.6 million last year due to higher margins achieved.
  
  Sales from the Group's manufacturing division grew by 12% to RM31.2 million from RM27.8 million last year, while profit before taxation rose by 43% to RM4.0 million from RM2.8 million last year. The increase was entirely due to better sales and margins achieved by the metal container operation.
  
  For quoted investments, there was a gain on disposal of marketable securities of RM2.7 million but a loss due to an allowance for diminution in value of RM1.5 million, as against last year's write back in allowance and gain totalling RM4.1 million. The first quarter of 2008 saw one of the worst performances of equity markets in the world. In addition, the March election results triggered widespread selling in our local bourse.

My last posting was posted on Pintaras Jaya II.

Here are some of my thoughts on Pintaras earnings.

1. Sales revenue

Sales revenue is certainly positive, showing growth on a quarter-quarter comparison.

2. Earnings

Current twelve months earnings totals 27.147 million, indicating strongly that Pintaras should record decent growth this fiscal year.

3. Balance Sheet.

Total cash balances is 65.283 million.

This is where I see some issues that needs to be evaluated.

Inventories are higher and most important the receivables has risen quite substantially.

And of course the total cash balances consist of Short Term Investments totaling 27.415 million.

And again this is a massive issue for those who do not like to see our plc dabbling in such investments.

From the company's own notes:

• For quoted investments, there was a gain on disposal of marketable securities of RM2.7 million but a loss due to an allowance for diminution in value of RM1.5 million, as against last year's write back in allowance and gain totalling RM4.1 million. The first quarter of 2008 saw one of the worst performances of equity markets in the world. In addition, the March election results triggered widespread selling in our local bourse.

And here is a snapshot from its earnings notes.

Yes there is gain made on disposal but this has been negated by the current paper loss.

How?