This Company's Earnings Soared 27-fold

Here's a financial news report that should win an award!

• YHS’ 2Q net profit up 27-fold
  Written by Loong Tse Min
  Friday, 31 July 2009 10:54
  
  PETALING JAYA: Drinks and food products maker YEO HIAP SENG (M) BHD (YHS) posted a 27-fold jump in net profit to RM2.1 million in its second quarter (2Q) ended June 30 from RM79,000 a year earlier, mainly due to higher sales in all sectors, festive sales in Indonesia and favourable foreign exchange rates.
  
  Revenue rose 10% to RM142.25 million from RM129.33 million due to higher turnover in all sectors, including export sales. Earnings per share rose to 1.4 sen from 0.05 sen.
  
  It declared an interim dividend of three sen per share less tax, totalling RM3.44 million.
  
  Cumulatively, for the six months to June 30, YHS posted a net loss of RM6.59 million versus a net profit of RM1.3 million a year earlier, mainly due to the impairment of an investment recognised in 1Q.
  
  Revenue fell 3.5% to RM271.09 million from RM280.8 million.
  
  In its 1Q, YHS had written down RM7.81 million in an investment in quoted securities. Coupled with lower sales and competitive pricing, the company had posted a quarterly pre-tax loss of RM8.91 million.
  
  YHS said the economic situation had improved but competition continued to be severe with aggressive pricing. “The company will continue to take necessary measures to protect its market share,” it said.
  
  
  This article appeared in The Edge Financial Daily, July 31, 2009. (source: here )

How on earth could they come out with such an header??? Sigh!!!

I will not add further except the following screen shot of YHS recent quarterly earnings.

Oh yeah... market is hot.

So Why Is IOI Corp Raising RM 1.2 Billion?

Posted this morning: IOI Corp: If Investors Are Not Happy

Saw some extra comments made on the Financial Edge Daily's version: IOI’s Lee: Dividend payouts not in jeopardy

• On the use of the RM1.2 billion proceeds, Lee said, “The funds will be kept for investment opportunities.”
  
  On whether any investment targets had been identified, he said: “Not yet. When we have, we’ll let you know.”

Huh?

Raise fund so that they can have extra cash?????

Holy cow!

What if they do another Menara Citibank fiasco and lose rm 73 million???

Not possible????

Is such corporate practise even acceptable?

Can they do a corporate fund raiser without knowing their investment targets???

Sigh!

Why can't they decide their investment target and let their minority shareholders know first????

Yeah, and if IOI investors are not happy.....

I wonder what award they got last night!

Sigh!

Where is MSWG?

Sigh!

You know, when you were small, not too long ago, and you wanted some extra pocket money for that new ______ , you would ask your parent yes?

And would our parent just hand us the moolah, without asking why?

And if our parents asked us why... can we turn around and tell our parents "Well Dad, if you are not happy........ "

Can you ever imagine this happening?

Featured Report: OSK On Astro All Asia Again!

Sometimes when you continue writing on a subject, your readers get tired of it and you, the writer also get sick of it too.

However, sometimes, it really gets so ...... stunning, that you are really left speechless.

I was left speechless when I saw OSK's report on Astro All Asia.

Back on 21st July 2009, I wrote the following. Featured Report: OSK Research On Astro All Asia
And today, if I am not mistaken, it's only 31st July 2009.

Anyway, as I had summarised, the following were the recommendations from OSK on Astro since Dec 2008.

1. 16 Dec 2008. Trading Buy Maintained 2.90.
2. 4th Feb 2009. Downgrade to Neutral. TP downgraded to 2.20.
3. 17th Feb 2009. Neutral maintained. 2.20.
4. 4th March 2009. Neutral maintained. 2.20.
5. 18th March 2009. Neutral maintained. TP downgraded to 2.00.
6. 17th April 2009. Trading Buy upgrade. TP upgraded to 2.92.
7. 21st May 2009. Trading Buy maintained. 2.92.
8. 1st June 2009. Trading Buy maintained TP upgraded to 3.50.
9. 15th June 2009, Trading Buy maintained 3.20-3.50.
10. 20th July 2009. Trading Buy maintained. TP upgraded to 4.20.

Yes, their last report was titled 'Windfall for Shareholders?' (I wonder what's the question mark for. Isn't it redunant since OSK takes into consideration that it would most likely to happen?)

Here's the link to the previous screenshot again. here

And here's their today report.

• In a swift move that is not totally unexpected, Astro said it will be raising the subscription price for its popular sports package by RM12/mth w.e.f. Aug 1. We estimate the price hike would increase our FY10/11 core earnings by 8.3%-16.2%, all else being equal. Historical precedence would suggest little down-trading activities from price hikes and where we expect the re-pricing to mitigate the pressure from escalating content cost going forward. Maintain TRADING BUY rating with a revised target price of RM3.92 based on DCF (WACC-10.5%).

I do not know to laugh of loud or cry.

The very same analyst that made the wild calls since Dec 2008, had forgotten that his last call, was on 20th July 2009 ( I wonder how many days ago) and on that day, he rated Astro to be a trading buy with a price target of 4.20.

Now he revised the price target to 3.92.

From 4.20 to 3.92, that's a rather hefty revision DOWNWARDS, yes????

And see how nicely he just mentioned as a 'revised price target'.

Now this isn't too accurate, eh?

Some might call it being snakey too!

If anyone did not read or follow his previous calls, would they have known that this is a price revision downwards????

And yeah... hey, it's still a TRADING BUY Maintained!

No one does it better hor?

And for the record again...

1. 16 Dec 2008. Trading Buy Maintained 2.90.
2. 4th Feb 2009. Downgrade to Neutral. TP downgraded to 2.20.
3. 17th Feb 2009. Neutral maintained. 2.20.
4. 4th March 2009. Neutral maintained. 2.20.
5. 18th March 2009. Neutral maintained. TP downgraded to 2.00.
6. 17th April 2009. Trading Buy upgrade. TP upgraded to 2.92.
7. 21st May 2009. Trading Buy maintained. 2.92.
8. 1st June 2009. Trading Buy maintained TP upgraded to 3.50.
9. 15th June 2009, Trading Buy maintained 3.20-3.50.
10. 20th July 2009. Trading Buy maintained. TP upgraded to 4.20.
11. 31st July 2009. Trading Buy maintained. TP revised to 3.92.

IOI Corp: If Investors Are Not Happy

Posted a few days ago: Comments On IOI's Right Issue: Version II

Now from an investor point of view, we all knew that IOI said it made huge profits the last year. More precisely from quarterly earnings ended 31/12/2007 to quarterly earnings ended recently on 31/3/2009, IOI said it made some 2.276 Billion in net earnings.

And yet the company said it wants to raise some 1.2 billion in a new rights issue.

Surely, it's not logical and neither is it any comforting for its shareholders.

Why the rights issue? What happened to all the big money made?

And then there was the Menara Citibank fiasco. Article entitled: IOI Corp wins bid for Menara Citibank? A rm586 million to buy an office building. And it ended up in a horror story. Yup, it lost some rm73 million when IOI abruptly decided NOT to proceed with the deal. Yes, the press was not impressed at all. IOI Corp should better explain why it’s losing its RM73mil deposit.

The following comments were raised in that article.

• So, why is that changed in three months? Was there an exodus of tenants from Menara Citibank? Did the rental income drop? Was there a collapse in office space prices? Why is the acquisition not strategic anymore?
  
  Why could not IOI Corp have foreseen these problems earlier? After all, the subprime crisis was already upon us. Why did it pay the deposit which it now has most likely lost if it had felt there could be problems?
  
  IOI Corp’s explanation is poor at best and we really don’t know what it is at worst. Investors certainly expect a lot more from this company, once the darling of the stock market. And so should regulators. Minority shareholders certainly have a right to be seriously upset.
  
  Coming so soon after its recent debacle where it reported foreign exchange losses of over RM312mil for the quarter to end-September, the latest episode will put another dent in its reputation, largely unsullied until the forex episode.

And needless to say there wasn't any clear explanation till this very day.

And on Business Times IOI Corp chief says rights plan won't affect dividend payout

• IOI Corp Bhd does not expect its proposed rights issue to affect its ability to pay dividends in the short term and says its major shareholder is ready to pick up shares that are not taken up.
  
  "Not really. Well, if they (investors) are not happy, then we (Progressive Holdings Sdn Bhd) can take it up," IOI Corp (1961) executive chairman Tan Sri Lee Shin Cheng said yesterday.

Did not like what I read at all.

Sorry... just me.

This rights issue is not about it affecting its ability to pay dividends.

It's all about IOI Corp being transparent on why such a huge rights issue coming on the back of a period where IOI made a lot, lot of money. Where did the money go? Why does IOI need the rights issue?

And to say.. if investors are not happy, they will take up the rights issue ... is simply lacking in taste.

How can he say like this? I mean this is rather arrogant, yes?

So if investors are not happy, should they sell their shares?

Lack Of Interest In US Treasury Action!

On CNBC: Weak Treasury Auctions Raise Worries About US Debt Burden

• The U.S. Treasury sold $39 billion in five-year debt Wednesday in an auction that drew poor demand, raising worries over the cost of financing the government's burgeoning budget deficit.
  
  It was the second lackluster showing in as many days, convincing analysts that the stellar results of debt auctions just a few weeks ago were a fluke and that Thursday's $28 billion seven-year offering could suffer a similar fate....

Concerns and worries.

Do see this posting also: Who Is Going To Lend US Money To Fund Its $2 Trillion Deficit

End Of Recession?

Here's an interesting report: The End Of Recession?

And Calculated Risk posting in response is worth reading too. A Few Comments on Housing Reports

Goldman Sachs: The Engineer Of Every Market Manipulation

Matt Taibbi on how Goldman Sachs has engineered every major market manipulation since the Great Depression ..... here

The videos on youtube.

The first thing you need to know about Goldman Sachs is that it's everywhere. The world's most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.

Any attempt to construct a narrative around all the former Goldmanites in influential positions quickly becomes an absurd and pointless exercise, like trying to make a list of everything. What you need to know is the big picture: If America is circling the drain, Goldman Sachs has found a way to be that drain — an extremely unfortunate loophole in the system of Western democratic capitalism, which never foresaw that in a society governed passively by free markets and free elections, organized greed always defeats disorganized democracy.

They achieve this using the same playbook over and over again. The formula is relatively simple: Goldman positions itself in the middle of a speculative bubble, selling investments they know are crap. Then they hoover up vast sums from the middle and lower floors of society with the aid of a crippled and corrupt state that allows it to rewrite the rules in exchange for the relative pennies the bank throws at political patronage. Finally, when it all goes bust, leaving millions of ordinary citizens broke and starving, they begin the entire process over again, riding in to rescue us all by lending us back our own money at interest, selling themselves as men above greed, just a bunch of really smart guys keeping the wheels greased. They've been pulling this same stunt over and over since the 1920s — and now they're preparing to do it again, creating what may be the biggest and most audacious bubble yet.

The basic scam in the Internet Age is pretty easy even for the financially illiterate to grasp. Companies that weren't much more than pot-fueled ideas scrawled on napkins by up-too-late bong-smokers were taken public via IPOs, hyped in the media and sold to the public for megamillions. It was as if banks like Goldman were wrapping ribbons around watermelons, tossing them out 50-story windows and opening the phones for bids. In this game you were a winner only if you took your money out before the melon hit the pavement.

It sounds obvious now, but what the average investor didn't know at the time was that the banks had changed the rules of the game, making the deals look better than they actually were. They did this by setting up what was, in reality, a two-tiered investment system — one for the insiders who knew the real numbers, and another for the lay investor who was invited to chase soaring prices the banks themselves knew were irrational. While Goldman's later pattern would be to capitalize on changes in the regulatory environment, its key innovation in the Internet years was to abandon its own industry's standards of quality control.

Goldman's role in the sweeping global disaster that was the housing bubble is not hard to trace. Here again, the basic trick was a decline in underwriting standards, although in this case the standards weren't in IPOs but in mortgages. By now almost everyone knows that for decades mortgage dealers insisted that home buyers be able to produce a down payment of 10 percent or more, show a steady income and good credit rating, and possess a real first and last name. Then, at the dawn of the new millennium, they suddenly threw all that shit out the window and started writing mortgages on the backs of napkins to cocktail waitresses and ex-cons carrying five bucks and a Snickers bar.

And what caused the huge spike in oil prices? Take a wild guess. Obviously Goldman had help — there were other players in the physical-commodities market — but the root cause had almost everything to do with the behavior of a few powerful actors determined to turn the once-solid market into a speculative casino. Goldman did it by persuading pension funds and other large institutional investors to invest in oil futures — agreeing to buy oil at a certain price on a fixed date. The push transformed oil from a physical commodity, rigidly subject to supply and demand, into something to bet on, like a stock. Between 2003 and 2008, the amount of speculative money in commodities grew from $13 billion to $317 billion, an increase of 2,300 percent. By 2008, a barrel of oil was traded 27 times, on average, before it was actually delivered and consumed.

The history of the recent financial crisis, which doubles as a history of the rapid decline and fall of the suddenly swindled-dry American empire, reads like a Who's Who of Goldman Sachs graduates. By now, most of us know the major players. As George Bush's last Treasury secretary, former Goldman CEO Henry Paulson was the architect of the bailout, a suspiciously self-serving plan to funnel trillions of Your Dollars to a handful of his old friends on Wall Street. Robert Rubin, Bill Clinton's former Treasury secretary, spent 26 years at Goldman before becoming chairman of Citigroup — which in turn got a $300 billion taxpayer bailout from Paulson. There's John Thain, the asshole chief of Merrill Lynch who bought an $87,000 area rug for his office as his company was imploding; a former Goldman banker, Thain enjoyed a multibillion-dollar handout from Paulson, who used billions in taxpayer funds to help Bank of America rescue Thain's sorry company. And Robert Steel, the former Goldmanite head of Wachovia, scored himself and his fellow executives $225 million in golden-parachute payments as his bank was self-destructing. There's Joshua Bolten, Bush's chief of staff during the bailout, and Mark Patterson, the current Treasury chief of staff, who was a Goldman lobbyist just a year ago, and Ed Liddy, the former Goldman director whom Paulson put in charge of bailed-out insurance giant AIG, which forked over $13 billion to Goldman after Liddy came on board. The heads of the Canadian and Italian national banks are Goldman alums, as is the head of the World Bank, the head of the New York Stock Exchange, the last two heads of the Federal Reserve Bank of New York — which, incidentally, is now in charge of overseeing Goldman.

But then, something happened. It's hard to say what it was exactly; it might have been the fact that Goldman's co-chairman in the early Nineties, Robert Rubin, followed Bill Clinton to the White House, where he directed the National Economic Council and eventually became Treasury secretary. While the American media fell in love with the story line of a pair of baby-boomer, Sixties-child, Fleetwood Mac yuppies nesting in the White House, it also nursed an undisguised crush on Rubin, who was hyped as without a doubt the smartest person ever to walk the face of the Earth, with Newton, Einstein, Mozart and Kant running far behind.

Rubin was the prototypical Goldman banker. He was probably born in a $4,000 suit, he had a face that seemed permanently frozen just short of an apology for being so much smarter than you, and he exuded a Spock-like, emotion-neutral exterior; the only human feeling you could imagine him experiencing was a nightmare about being forced to fly coach. It became almost a national cliché that whatever Rubin thought was best for the economy — a phenomenon that reached its apex in 1999, when Rubin appeared on the cover of Time with his Treasury deputy, Larry Summers, and Fed chief Alan Greenspan under the headline the committee to save the world. And "what Rubin thought," mostly, was that the American economy, and in particular the financial markets, were over-regulated and needed to be set free. During his tenure at Treasury, the Clinton White House made a series of moves that would have drastic consequences for the global economy — beginning with Rubin's complete and total failure to regulate his old firm during its first mad dash for obscene short-term profits.

After the oil bubble collapsed last fall, there was no new bubble to keep things humming — this time, the money seems to be really gone, like worldwide-depression gone. So the financial safari has moved elsewhere, and the big game in the hunt has become the only remaining pool of dumb, unguarded capital left to feed upon: taxpayer money. Here, in the biggest bailout in history, is where Goldman Sachs really started to flex its muscle.

It began in September of last year, when then-Treasury secretary Paulson made a momentous series of decisions. Although he had already engineered a rescue of Bear Stearns a few months before and helped bail out quasi-private lenders Fannie Mae and Freddie Mac, Paulson elected to let Lehman Brothers — one of Goldman's last real competitors — collapse without intervention. ("Goldman's superhero status was left intact," says market analyst Eric Salzman, "and an investment-banking competitor, Lehman, goes away.") The very next day, Paulson greenlighted a massive, $85 billion bailout of AIG, which promptly turned around and repaid $13 billion it owed to Goldman. Thanks to the rescue effort, the bank ended up getting paid in full for its bad bets: By contrast, retired auto workers awaiting the Chrysler bailout will be lucky to receive 50 cents for every dollar they are owed.

Immediately after the AIG bailout, Paulson announced his federal bailout for the financial industry, a $700 billion plan called the Troubled Asset Relief Program, and put a heretofore unknown 35-year-old Goldman banker named Neel Kashkari in charge of administering the funds. In order to qualify for bailout monies, Goldman announced that it would convert from an investment bank to a bank-holding company, a move that allows it access not only to $10 billion in TARP funds, but to a whole galaxy of less conspicuous, publicly backed funding — most notably, lending from the discount window of the Federal Reserve. By the end of March, the Fed will have lent or guaranteed at least $8.7 trillion under a series of new bailout programs — and thanks to an obscure law allowing the Fed to block most congressional audits, both the amounts and the recipients of the monies remain almost entirely secret.

Converting to a bank-holding company has other benefits as well: Goldman's primary supervisor is now the New York Fed, whose chairman at the time of its announcement was Stephen Friedman, a former co-chairman of Goldman Sachs. Friedman was technically in violation of Federal Reserve policy by remaining on the board of Goldman even as he was supposedly regulating the bank; in order to rectify the problem, he applied for, and got, a conflict-of-interest waiver from the government. Friedman was also supposed to divest himself of his Goldman stock after Goldman became a bank-holding company, but thanks to the waiver, he was allowed to go out and buy 52,000 additional shares in his old bank, leaving him $3 million richer. Friedman stepped down in May, but the man now in charge of supervising Goldman — New York Fed president William Dudley — is yet another former Goldmanite.

The collective message of all of this — the AIG bailout, the swift approval for its bank-holding conversion, the TARP funds — is that when it comes to Goldman Sachs, there isn't a free market at all. The government might let other players on the market die, but it simply will not allow Goldman to fail under any circumstances. Its edge in the market has suddenly become an open declaration of supreme privilege. "In the past it was an implicit advantage," says Simon Johnson, an economics professor at MIT and former official at the International Monetary Fund, who compares the bailout to the crony capitalism he has seen in Third World countries. "Now it's more of an explicit advantage."

Fast-forward to today. It's early June in Washington, D.C. Barack Obama, a popular young politician whose leading private campaign donor was an investment bank called Goldman Sachs — its employees paid some $981,000 to his campaign — sits in the White House. Having seamlessly navigated the political minefield of the bailout era, Goldman is once again back to its old business, scouting out loopholes in a new government-created market with the aid of a new set of alumni occupying key government jobs.

Gone are Hank Paulson and Neel Kashkari; in their place are Treasury chief of staff Mark Patterson and CFTC chief Gary Gensler, both former Goldmanites. (Gensler was the firm's co-head of finance.) And instead of credit derivatives or oil futures or mortgage-backed CDOs, the new game in town, the next bubble, is in carbon credits — a booming trillion- dollar market that barely even exists yet, but will if the Democratic Party that it gave $4,452,585 to in the last election manages to push into existence a groundbreaking new commodities bubble, disguised as an "environmental plan," called cap-and-trade. The new carbon-credit market is a virtual repeat of the commodities-market casino that's been kind to Goldman, except it has one delicious new wrinkle: If the plan goes forward as expected, the rise in prices will be government-mandated. Goldman won't even have to rig the game. It will be rigged in advance.

See Matt Taibbi react to Goldman Sachs' excuse

RCE Capital's Private Placement

You could not ask to write a much better script. :)

Last night the Edge Financial Daily uploaded this.

• RCECap fixes placement price
  Written by The Edge Financial Daily
  Monday, 27 July 2009 22:26
  
  KUALA LUMPUR: RCE CAPITAL BHD has fixed the issue price for its private placement of 71.09 million shares of 10 sen each at 55.03sen per share.
  
  In a statement today, RCE Capital said the price was a discount of 10% to the five-day weighted average market price from July 20 to 24 of 61.15 sen per share.
  
  It said the private placement was expected to be completed by mid-August.

Private placement fixed at 55.03 sen.

Hmm.... my a private placement. Now this is a good reason to buy up the share.

And this morning, the Edge Financial MADE another posting.

• RCE Capital up in very active trade
  Written by Joseph Chin
  Tuesday, 28 July 2009 09:49
  
  KUALA LUMPUR: Shares of RCE CAPITAL BHD was the most active counter in early trade on July 28 in the absence of corporate news except that it had fixed the placement shares at 55.03 sen each.
  
  At 9.44am, it was up three sen to 65.5 sen with 7.31 million shares done.
  
  The company announced on July 27 the private placement of 71.09 million new shares of 10 sen each to investors was fixed at 55.03 sen.
  
  RCE Capital said the issue price was arrived at after applying a discount of 10% based on the 5-day weighted average market price of RCE shares from July 20 to 24 of 61.15 per share.
  
  With the price-fixing of the placement Shares, the company said it expected the private placement to be completed by mid-August.

Hmm.... private placement. Benefiting those placement buyers. Let's get active yo!

And then K&N Kenanga decides to issue a buy report on RCE.

Its buy target 70 sen. LOL!

Talk about sweet, sweet timing.

Life is simply grand.

Let's push up the shares so these private placement buyers could get rich fast!

Sweetness!

Share BuyBacks: Parkson Holdings Part II

It's been a long time since I had updated on Parkson's share buybacks.

I've compiled a table and loaded it into this posting. Do note that due to sheer size of the table and that I am but human, error in data entry could happen. It's too huge for me to check back. :P

*************

As per my entries, it would appear that Parkson had spend some 93 million in share buybacks.

Average cost is around 4.42.

Oops.... how much is Parkson trading now? hmmmm..... LOL! Yeah... see, I am posting something positive, eh?

Ho ho ho.... how? Value woh... buy ah?

**************
Anyway... cough... cough... cough....

if the current share price of Parkson isn't taken into consideration... aren't you shocked at the monetary value of the share buybacks?

At least 93 million woh.

When I first blogged on this issue, almost exactly a year ago, Pakson Holdings Share Buybacks, Parkson back was sitting on a whopping 'paper loss' of around some 6.4 million. Now it's sitting on 'paper gains'. (Success story? LOL! See, I do give credit when credit is due)

How now my dearest?

:D

***************

harlooo... this is just a mere observation. And if you insist it's a tip... lol.... don't blame me if you don't lose money.

**************

ps... do you think it's ironic? Parkson has stopped buying back their shares since end March 2009. Their shares had been moving higher and higher since then. LOL! Maybe as some uncle would proclaim... Parkson is jinko to their own shares! LOL!

Maxbiz: The Dog Ate My Assets!

Do you remember them school days. You forgot your homework and as kids, we would come out with some of the daftest and silliest excuses in our attempt to cover up.

I was less than impressed when I highlighted Maxbiz and its missing 40 million assets in the posting, Honey Did You See My Missing 40 Million Assets?

On the Edge Financial Daily, Maxbiz fails to trace missing assets and by jolly, they did lose a car (as suggested in the earlier blog post!)!

Sorry but it's not even funny.

It's simply ludicrous.

What on earth is happening in this company?

• KUALA LUMPUR: Maxbiz Corp Bhd said today its missing assets of RM40.3 million could have generated sufficient returns to cover a RM1.8 million loan given to its subsidiary Mayford Garments Sdn Bhd (MGSB) by RHB Bank Bhd.
  
  It said a winding-up order was made against MGSB on Feb 28, 2007 by RHB Bank as the company had defaulted on the RM1.8 million loan. Maxbiz said attempts were being made to resolve the matter with RHB Bank.
  
  The missing assets comprised plant and machinery, a motor vehicle, office equipment, furniture and fittings, with a net book value of RM40.29 million as at Dec 31, 2006. The asset cost was RM64.44 million as at that date.
  
  Maxbiz said directors who were appointed on June 26, 2007 and Nov 26, 2007 had failed to communicate with the former directors of MGSB over the missing assets. It has lodged police reports over the matter.
  
  Maxbiz said it had written off its entire investment of RM47.11 million in MGSB last year.

How could plant and machinery go missing?

And these missing assets comprising of plant and machinery, motor vehicle, office equipment, furniture and fittings carried a net book value of rm40.29 million??????????????

??????

( Off topic: See this is why I personally would not invest using book value yardsticks. There is always a chance of the company inflating their book value. )

And needless to say, when I visited Bursa website for more info on Maxbiz, I get such announcements.

• MAXBIZ CORPORATION BERHAD ("MAXBIZ") - Monthly Status Announcement on Default in Payment Pursuant to Practice Note No. 1/2001
• Quarterly rpt on consolidated results for the financial period ended 31/3/2009

This announcement in May 2009 was worth noting: MAXBIZ CORPORATION BERHAD ("MAXBIZ" or "the Company") - Deviation of Results

• Pursuant to Paragraph 9.19 (34) of the Listing Requirements of Bursa Malaysia Securities Berhad, the Board of Directors of MAXBIZ wishes to announce that the Company's loss after taxation for the financial year ended 31 December 2008 has deviated by 1135% from the unaudited loss after taxation of RM6.227 million as announced on 2 March 2009. The audited loss after taxation stated in the audited accounts now stands at RM76.926 million.

WISHES to announce? Duh! Rather poor choice of word, no? I mean, is the company so happy that there is such a massive deviation in earnings????

Omigosh... from 6.227 million losses corrected to rm76.926 million!!!!!!!!!!!!!!

!!!

More On IOI Corp

Posted yesterday. Comments On IOI's Right Issue: Version II

In that posting I highlighted one simple issue.

From Feb 2008 quarterly earnings (for period ended 31/12/2007) to Feb 2009 quarterly earnings (31/12/2008), IOI announced it made some 2.2 Billion in earnings. And despite making so much money, rm2.276 Billion in this period, IOI's net debt actually increased by 1.918 billion.

My inquisitive mind, asked where did the money go.

Got the following comment.

• jitseng said...
  The money to stock buys back.The used about 1.6b

Now if I search Bursa website, I would find this announcement dated 22/6/2009. Notice of Shares Buy Back - Immediate Announcement

In it, it states that the cumulative shares bought back was 291,244,500.

Now I give it a benefit of a doubt, and make a simple goofy assumption that all the shares bought back was during this period and I would also assume what jitseng is saying is correct.

So assuming IOI spend some 1.6 billion in share buybacks.

Now I am more dumbfounded because I would look at it in an even more simplistic manner.

This company made some 2.2 Billion in profits and then it spends some 1.6 billion in share buybacks.

Errr..... wazzap doc?

Does this sound like a good business economics at all?

Does such a corporate exercise makes business sense at all?

Is The Local Retailer Not In The Market?

Some had been concerned with the lack of volume in the local market.

Without volume, it means that there is not much buying interest.

And without the buying interest, how high can the stock market go?

On Star Biz on Saturday Whither stock market?

• Of volumes and liquidity
  
  A dealer who has been trading the Malaysian market over the last 10 years says it is getting increasingly difficult to do so. He adds that foreign transactions have been insignificant. Over the last two weeks, locals made up some 80% of the volumes.
  
  “Yes, you see 1 billion volumes being transacted in the last two weeks, but there’s no real liquidity in the market. Retailers are definitely not in. They are actually very few participants in the market. It is just the institutions that are supporting the market,” the dealer says.
  
  On this note too, he says foreigners do not view Malaysia as an attractive market.
  
  “They cannot short our market because it goes up very easily. Under the FBM 30 index, the top 5 stocks already make up some 50% of weightage. Once these stocks move, the index goes up, hence there is no opportunity to short. And for the foreigners to buy now, there is no upside. Hence what do they do? Exit the market of course,” says the dealer.

Firstly, who the dealer? Dealer from which company?

Anyway, this unknown dealer does have a point or two.

• ......... but there’s no real liquidity in the market. Retailers are definitely not in. They are actually very few participants in the market. It is just the institutions that are supporting the market,”

Is this point valid?

Is there a lack of volume?

If so... is the retailers not in the market?

Why?

Comments On IOI's Right Issue: Version II

Posted Comments On IOI's Rights Issue yesterday.

Got the following comments...

• 棕油网 said...
  moola, please refer to three items into one,
  
  there are short term fund 1,905,639
  short term deposit 268,556
  cash and bank 341,407
  
  just look back to Humeind, their piggy cash slump after exchange with Evergreen Fibreboard, but later the director gave a clue to the cash position.

Yeah, I goofed up. :p2

I missed out the short term fund and my attempt in the corrections looks so freakingly messy.

Hence this posting.

Let me start over again.

Feb 2008, Quarterly rpt on consolidated results for the financial period ended 31/12/2007

Total cash should be 427.109 + 531.574 + 692.897 = 1651.580 million (or 1.65 Billion)

Short term + long term borrowings = 205.697 + 3363.589 = 3569.186 million (3.569 Billion!)

Which means from a cash/debt position, IOI's is in a net debt position of 3.569 - 1.651 = 1.918 Billion.

Now let's look at the money earned during this period

1. Quarterly rpt on consolidated results for the financial period ended 31/12/2007
Net earnings: _______________ 581.191 million

2. Quarterly rpt on consolidated results for the financial period ended 31/3/2008
Net earnings: _______________ 601.639 million

3. Quarterly rpt on consolidated results for the financial period ended 30/6/2008
Net earnings: _______________ 597.284 million

4. Quarterly rpt on consolidated results for the financial period ended 30/9/2008
Net earnings: _______________ 290.500 million

5. Quarterly rpt on consolidated results for the financial period ended 31/12/2008
Net earnings: _______________ 168.586 million

6. Quarterly rpt on consolidated results for the financial period ended 31/3/2009
Net earnings: _______________ 37.362 million

Adding it all up (did you note the drastic decline in earnings?), I got 2276.562 million (or 2.276 Billion) (hope I did not goofed up again. )

So during this period, IOI made 2.276 Billion.

However, as per IOI's last reported quarterly earnings was on 15th May 2009, Quarterly rpt on consolidated results for the financial period ended 31/3/2009, it showed that IOI cash balances were 268.556 + 341.407 + 1905.639 = 2515.602 million (or 2.515 Billion)

Short term + long term borrowings = 37.771 + 5682.610 = 5721.381 million (5.721 Billion!)

Which meant, from a cash/debt position, IOI's net debt = 5721.381 - 2515.602 = 3205.779 million (or 3.205 Billion!).

Compare to 31/12,2007, IOI was in a net debt of 1.918 billion.

Which means despite earning 2.276 Billion in this period, IOI's net debt increased by 1.918 billion.

Where did the money go?

Yes, I am aware that during a major acquisition or in IOI's case, the privatisation of IOI Properties, cash position does weaken.

Would this be the case?

Now IOI Properties privatisation was completed in April 2009. Now I would use Feb 2009 earnings as a reference point (would I be goofing up here?). Quarterly rpt on consolidated results for the financial period ended 31/12/2008

Total cash = 1005.374 + 397.354 + 445.530 = 1848.258 million or 1.848 Billion.

Short term + Long term borrowings = 73.453 + 3816.098 = 3889.551 million or 3.889 Billion.

Net debt = 3.889 - 1.848 = 2.041 billion.

Ahh...

Which meant that IOI's cash/debt position did not deteriorate as suggested.

However, if we minus the May's earnings, IOI still made a lot of money.

How much? Try 2276.562 - 37.362 = 2.239 Billion.

Yet again... despite making sooooooooooo much money, IOI's balance sheet did NOT reflect the richness gained from the CPO bull run.

Another issue, as seen in May 2009 earnings, IOI was in a net debt of 3205.779 million. In Feb 2009, it was 2.041 billion.

Which meant IOI net debt increased by some 1.164 Billion.

And all this from IOI's Privatisation. (Would I be a goofer to say this?)

Now isn't it ironic that IOI's proposed rights issue amounts to some 1.2 billion?

Would I be goofy to suggest that this rights issue is paying for the privatisation of IOI Property?

How?

Would you be happy?

Comments On IOI's Rights Issue

On Star Business. in the article, Report: New IOI debt sign of ‘more subdued outlook’, several research houses gave their opinions.

I was not impressed with the last few passages.

• ........... A local brokerage said while the rights issue might not be ideal, it was probably the easiest and fastest way to raise the required funds in the current tight capital market.
  
  IOI was likely to use the proceeds to refinance some of its convertible bond issues, of which one is due in 2011 and another in 2013, it said.
  
  A bank-backed research house, meanwhile, believed IOI was building its war chest for major acquisitions given that it was in a healthy financial position.
  
  IOI’s free cashflow for FY10 is estimated at about RM1.5bil versus capex needs of RM500mil. As at May 8, unutilised proceeds from the third exchangeable bonds totalled RM732mil.
  
  Regional plantation companies also seemed to be on a fund-raising spree, the research house said, noting that Wilmar International Ltd was listing its China operations in Hong Kong while Indofood Agri-Resources was mulling a 1 trillion rupiah bond issue.

Not too impressed with this un-named bank-backed research house.

Which research house is this?

Why give such comments and chose to be an unknown?

How accurate is the healthy financial position mentioned by this unknown bank-backed research house?

Me?

I would question the healthy financial position.

Let me prove what I am saying.

Earlier this year, I wrote the following posting. IOI Earnings Results And Flashback On What Has IOI Done The Past One Year

Let me re-cycle some stuff.

Here's the objectivity of this simple exercise. Since 2008, the CPO had the mother of all bull runs. All planters made insane profit. Money were like falling from the sky. Yes?

So a comparison from a quarterly reports then and compare to present day, and see how healthy is IOI's financial position.

Would this not be logical?

Anyway, from that posting... , I want to use the quarterly earnings reported on Feb 2008.

:: ..... I start with looking at what was on IOI's books back exactly a year ago, Feb 2008, Quarterly rpt on consolidated results for the financial period ended 31/12/2007

Short term funds+cash and bank balances = 427.109 + 531.574 = 958.683 million.

*** Errata !!! ***.

Missed out the short term funds. Looks like my eyes are short! :p2

Total cash should be 958.683 + 692.897 = 1651.560 million.

Short term + long term borrowings = 205.697 + 3363.589 = 3569.186 million (3.569 Billion!) ( you can verify this on this screenshot here )

Net debt position = 3569.186 - 1651.560 = 1917.626 million

IOI's last reported quarterly earnings was on 15th May 2009. Quarterly rpt on consolidated results for the financial period ended 31/3/2009

Short term funds+cash and bank balances = 268.556 + 341.407 = 609.963 million.

*** Erata !!! ***

Total cash should be 609.963 + 1905.639 = 2515.602 million

Short term + long term borrowings = 37.771 + 5682.610 = 5721.381 million (5.721 Billion!)

Net debt = 5721.381 - 2515.602 = 3205.779 million

How?

*** Errata ***

Cash balances of 958.683 million had diminished to 609.963 million!
Loans ballooned from 3.569 Billion to 5.721 Billion!!

IOI as at 31/12/2007 was in a net debt of 1917.626 million. IOI latest earnings as at 31/3/2009 saw IOI having net debt of 3205.779 million.

I do not know but would this be the definition of a healthy financial position when cash had diminished and loans ballooned? when during a period when IOI saw CPO crude prices hit record highs, their net cash position actually deteriorated?

Now consider this also.

Anyone want to count the 'money' made by IOI during this period?

1. Quarterly rpt on consolidated results for the financial period ended 31/12/2007
Net earnings: _______________

2. Quarterly rpt on consolidated results for the financial period ended 31/3/2008
Net earnings: _______________

3. Quarterly rpt on consolidated results for the financial period ended 30/6/2008
Net earnings: _______________

4. Quarterly rpt on consolidated results for the financial period ended 30/9/2008
Net earnings: _______________

5. Quarterly rpt on consolidated results for the financial period ended 31/12/2008
Net earnings: _______________

6. Quarterly rpt on consolidated results for the financial period ended 31/3/2009
Net earnings: _______________

So where all the money go when IOI was making big money?

Dividends? Maybe IOI paid out a lot of dividends?

Second interim dividend
Interim Dividend
Interim Dividend
Interim Dividend

And then there was the privatisation of their listed subsidiary, IOI Properties. ( see Big Ouch For IOI Properties! )

How?

If you are an IOI Corp shareholder, how would you evaluate your investment?

Don't you find it incredible that after the biggest ever bull run in the CPO prices that IOI Corp want to raise some 1.22 billion in a rights issue?

How my dearest?

***************************
Many thanks to 棕油网 for pointing out that I had made some error. :D

Maxis Listing? Not Likely!

:D

On Business Times, the following caught my attention.

• "Even if they agree, I doubt it will be relisted anytime soon, because the valuation is lower than the market peak when it went private. I doubt it will be the shareholders' first choice," Juniper Securities head of research Pong Teng Siew told Business Times yesterday. (source: here )

Now this is a rather valid point.

Valuation now is LOWER than when Maxis went PRIVATE.

Meaning to say, if Maxis were to go public now, this means the owners will be selling the shares back to the public at a much lower price than the owners paid when they privatised Maxis.

Sell lower than they bought?

oO

Simply put... RUGI BUSINESS lah if they re-list.

LOL!

Now this puts a smile on my face.

How Is Our Stock Market Doing?

Yo!

Market so 'panas'!!!



How now my dearest?

Care to join the fun?

Or are you simply desire-less?

Would You Be Happy IF Maxis Is Listed Once More?

On the Business Times.

• Market abuzz over possible Maxis relisting
  
  By Chong Pooi KoonPublished: 2009/07/23
  
  News of a potential relisting of Maxis Communications Bhd, the country's biggest mobile phone operator valued at some RM40 billion before it was taken private in 2007 by tycoon T. Ananda Krishnan, saw the market all abuzz yesterday.
  
  It has drawn mixed reaction from analysts, with some doubting that the deal would help the company since Bursa Malaysia is still way off its historical high even after the recent rally.
  
  "Why now? Ordinarily, you'd say now is not the best time (for an initial public offering (IPO))," said Khair Mirza, a senior telecommunications analyst with Maybank Investment Bank.
  
  "Still, the company's requirement to raise fund through the debt market could be cheaper if it were listed," he told Business Times.
  
  However, some analysts said the plan makes sense because being a public-listed company will allow Maxis to raise cheaper funds for expansion from the bond market.
  
  In a media briefing on his working visit to Saudi Arabia yesterday, Prime Minister Datuk Seri Najib Razak said he had suggested Maxis be relisted to help attract investors to the local stock exchange.
  
  The premier had discussed the Maxis IPO proposal with King Abdullah Abdulaziz Al Saud as Saudi Telecom Co, which owns 25 per cent of Maxis, is a government-linked company.
  
  The potential listing is expected to boost the profile of the Malaysia-Saudi partnership while enlarging the size of the local stock market. A large and global IPO like Maxis will also help profile Malaysia to international investors.
  
  Maxis, whose management was meeting to work out a response to the Prime Minister's statement, decided late last night not to issue a press statement.

Would I be jumping for joy on such news?

NO, NO, NO, NOOOOoooooooooooooooooooooo!

I find it utterly shambolic that a listed company can list and delist as per their wimps and fancy.

Does the company think that the Bursa is revolving door? A hotel Kuala Lumpur where one can check in and out anytime they like?

Yup, it will utterly make a mockery for the stock exchange if this would happen!

List, delist, list, delist....... (macam mana ni? kambing or going? )

And how about the minority shareholders, the long term investors?

How can an investor invest long term when the company has the option of listing and delisting anytime?

My say?

If they want to delist after listing, fine. Just don't let them re-list again man!

Sorry but this is my flawed opinion.

But sadly, the stock exchange, as a listed entity, from a business perspective, such a listing would only generate revenue. And more revenue means more cash. Why would Bursa say 'no' from a business perspective?

Sigh.

Such is the quality of our stock exchange.

Hence, I reckon that despite Maxis making a fool of the exchange previously by delisting, I do have a strange sick feeling that such an exercise could very well happen.

Hope and I pray very hard that I am wrong!

Honey Did You See My Missing 40 Million Assets?

On the Edge Financial News.

• Maxbiz lodges report over RM40m missing assets
  Written by Financial Daily
  Wednesday, 22 July 2009 11:35
  
  KUALA LUMPUR: Maxbiz Corporation Bhd has lodged a police report over missing assets valued at over RM40 million.
  
  In a statement yesterday, Maxbiz said the missing assets belonged to its wholly owned subsidiary Mayford Garments Sdn Bhd, which had been served with a winding-up order by the High Court here.
  
  It said the Batu Pahat commercial crime division had started investigations on Monday to recover the assets.
  
  
  This article appeared in The Edge Financial Daily, July 22, 2009. ( link source: here )

WOW!

How can assets worth 40 million be missing??? ( macam mana ni? siapa telan? )

40 million woh!

I mean.. ok... perhaps one can 'LOSE' a car or maybe two.... but... but... butt... we are talking about missing 40 million worth of assests!

Yes this is truly mind boggling!!

Yes we can!

Featured Report: OSK Research On Axiata

The following article on the Edge Financial Daily, OSK upgrades Axiata to buy caught my attention.

• OSK Research yesterday upgraded its recommendation for Axiata Group Bhd to buy from trading buy with a higher price target of RM3.40 on expectations of better earnings from its two main subsidiaries Celcom (M) Bhd and PT Excelcomindo Pratama (XL).
  
  “We expect XL to report a headline net profit in 2Q09 on the recovery in mobile spending and a gain in the rupiah of some 12% year-to-date.
  
  “Our recommendation on the stock is upgraded to a buy from trading buy on growing conviction on the earnings delivery of its overseas mobile assets and our view of diminishing medium-term concerns over its balance sheet,” OSK Research said in a note....

I was aroused. LOL! I was excited yo!

I wondered. Would OSK be consistent in their recommendation?

Or perhaps would I be seeing their incredible flip-flop on price targets as seen in recent postings like Featured Report: OSK Research On Astro All Asia or Featured Report: OSK on Pelikan Holdings or What Hope For Malaysian Investing Public When Research House Makes Such Calls?

Let's track back on OSK recommendation on Axiata since the start of the year....

I think I will add in the last report made in 2008. At least we know how their recommendation ended last year. :D

And just for the record, on 28th April 2008, OSK initial coverage on Axiata (or TM International - old name) had Axiata as a buy with a TP of 9.20.

OSK ended 2008 with a Neutral call on Axiata. Price target was 4.20.

8th January 2009.

Feb 6th 2009. Axiata falls to 3.18. OSK held firm despite market chatter on possible writedown on Idea for Axiata. :D (consistent so far yo! )


19th Feb 2009. YIKES!!!!!!!!!!!!!


Recommendation is stated as NEUTRAL and target price remained at 4.20 but they threw in a screw or curve ball!!!

If you look at the second arrow above this NAUGHTY LINE stood out like sore thumb! Quote "Our forecast and target price are under review pending the release of its results on Feb 26. TMI remains a long-term BUY."

Macam mana ni?

The recommendation is NEUTRAL and the last I knew, neutral is neutral is neutral. A neutral does not equate a long term buy!

Perhaps I am from another planet!!

And then I was also confused. (as usual. :p2 )

On 6th Feb 2009, Axiata was 3.18 and the so-called Neutral price was 4.20. Well that's an upside reward of 1.02 or 32% based on a reference price of 3.18. 32% precent woh! How come the recommendation was NEUTRAL? ( macam mana ni? )

You know that at the end of every OSK report, they have this explanation of their recommendation calls and this is the snap shot of it....

So as per their report: "Neutral: Share price may fall within the range of +/- 10% over the next 12 months"

hmmm....... :p2

Feb 26th 2209. Axiata announced its quarterly earnings. Its losses was more than 515 million!

And with the rights issue, OSK correctly reduced the target price.

However as usual I was baffled. Why? I was baffled with their insistent on having Axiata at NEUTRAL! (Yeah, OSK is the only one in town who can cut target price by some 28% and yet can still maintain their recommendation. oO )

• RECOMMENDATION
  
  Maintain NEUTRAL. Target price cut to RM3.00. We slash our FY09/10 forecasts by 14-28%, mainly to reflect weaker EBITDA margins on average of 37% versus 38.5% previously due to the higher operating cost environment for most of its overseas assets. Our revised projections see TMI posting a slight earnings contraction of 4% for FY09 before recovering to 19% in FY10, driven in the main by lower interest charges following the de-leveraging of its balance sheet.
  
  We believe the market may have already priced in the risk to certain extent of a dilutive recapitalization exercise, with TMI’s share price hitting a record low of RM3.02 earlier this month. That the pricing of the rights shares has yet been fixed could potentially result in further dilution should its share price weaken further. As such, we now attached a 20% discount to our SOP target of RM3.76 to derive our new target price of RM3.00.
  
  We would turn buyers of the stock should the share price dip below RM2.70.

March 24th, Axiata fixed the rights issue at 1.12. It was a rights to buy five new shares for every four shares held. (hope my england is a ok. :p2 )

March 25th. Price is now 2.61. Their call? Take profit. TP downgraded to 2.50!

I kid you NOT!

What kind of recommendation is take profit????? ( Macam mana ni? Axiata had been plunging since listing... got what profit to take????? )

Wait it's now only March 2009. Less than one year ago, OSK had Axiata at a buy with a TP of 9.20!

Lucky I got that report to share.

March 2009... Global markets were bouncing and our market too was 'panas'.

And guess what was OSK next recommendation?

Upgrade to NEUTRAL with TP remaining at 2.50! LOL! I kid you not! Have a look yo!


LOL!

One month later.... came another shocker!!!!!!!!!!!!

28th April 2009. OSK downgrades Axiata once again! LOL!

Axiata then traded around 2.10 and OSK gave it a TP of 1.73. oO

And once again.... what's the meaning of TAKE PROFIT? (apa ni?)

Where's my chart of Axiata?


The above chart shows the performance of AXATA from listing till 30th April 2009. It would be pretty hard to take profit, yes? ( unless of course one is a super duper trader. Oh.. do remember to ask iCap on this one during the upcoming AGM. :D )

And oh yeah, do check this past posting on 25th March 2009: What A Trading Day For TMI. Axiata or TMI had a brutal day that fine March day.

May 20th, OSK then upgrade Axiata to a trading buy to 2.70!

• ... upgrade our recommendation to a TRADING BUY from TAKE PROFIT as our previous concerns over the overhang arising from the listing of its rights shares appear to be unjustified. Our sum-of-the-parts target price is now raised to RM2.70 (from RM1.73), factoring in the independent contribution from Idea and after rolling over our valuation on Celcom to FY10.

June 18th. Trading buy maintained at 2.70.


July 8th 2009. Trading Buy maintained at 2.70.



And as most are aware, Axiata had been rather hot lately. Yesterday, OSK made another update on Aziata. And guess what? They raised their TP for Axiata to 3.40.


So how now my dearest?

Axiata TP is now 3.40 woh!

You want or not, cheh?

:p2

Recommendation history and price target.

1. 24th Dec 2008. Axiata 3.58. Maintain Neutral at 4.20.
2. 08th Jan 2009. Axiata 3.60. Maintain Neutral at 4.20.
3. 06th Feb 2009. Axiata 3.18. Maintain Neutral at 4.20.
4. 19th Feb 2009. Axiata 3.36. Maintain Neutral at 4.20.
5. 28th Feb 2009. Axiata 3.06. Maintain Neutral. TP lowered to 3.00.
6. 25th Mar 2009. Axiata 2.61. Take profit. Downgrade. TP lowered to 2.50.
7. 30th Mar 2009. Axiata 2.38. Upgrade to Neutral. TP at 2.50.
8. 28th Apr 2009. Axiata 2.10. Take profit. Downgrade. TP lowered to 1.73.
9. 20th May 2009. Axiata 2.32. Upgrade to trading buy! TP at 2.70.
10. 18th Jun 2009. Axiata 2.28. Trading buy maintained. TP at 2.70.
11. 08th Jul 2009. Axiata 2.42. Trading buy maintained. TP at 2.70.
12. 21st Jul 2009. Axiata 2.98. BUY upgrade. TP at 3.40.