Zelan Hit By Massive Losses

In the posting, So What Is OSK Saying Now About MMC, one of the stuff mentioned was the continued losses in Zelan.

Zelan announced its earnings last Thursday, 27th May 2010.

I was expecting losses from Zelan but the size of the losses were staggering! 184 million in losses for the quarter and over 254 million in losses for the fiscal year!

What was glaring for me in Zelan's balance sheet was its trade receivables. It stands at a whopping 621 million and needless to say the massive decline in cash balances as shown in the balance sheet snap shot below.


Back in 2008, it changed it's financial year end. See earnings report on May 2008: Quarterly rpt on consolidated results for the financial period ended 31/3/2008

See how Zelan's receivables simply exploded when once compares Zelan's receivables ending at 31st March 2008 with 31st Jan 2007? 31st Jan 2007, Zelan's receivables was at 206 million. At 31st March 2008, receivables blew up to 805 million!

A year later in 2009, Zelan recorded its first annual fiscal losses. Quarterly rpt on consolidated results for the financial period ended 31/3/2009

It's receivables 'fell' or 'improved' to some 705 million. And cash balances is now at 92 million.

Today receivables is at 621 million. Cash balances at 43 million.

How?

On one hand, we can say Zelan's receivables have indeed been 'improving' since May 2008. But at 621 million, the receivables is a lot. the size of the receivables is a worry. Why? Because the longer it remains in the balance sheet, the receivables do have to be reevaluated and if it cannot be collected, it has to be reclassified as bad debts and ultimately Zelan would be hit by bigger losses caused by provision for bad debts. (Yeah, some would ask how did the amounts receivables got so big in the first place?)

And due to the size of the losses, Zelan the stock, is getting hit big time. At this moment of time, Zelan last traded at 47 sen.

Here's Zelan's most recent 3 year stock chart.

Did Berkshire Get Insider Info On Its Disposal Of Shares In Moody's?

Saw the following news clip on the Edge Financial Daily: Berkshire confirms Buffett subpoenaed to testify

• NEW YORK: Berkshire Hathaway Inc confirmed on Friday, May 28 that Warren Buffett will testify under subpoena before a US panel examining the causes of the 2008 financial crisis.
  
  Buffett, 79, rebuffed earlier requests by the Financial Crisis Inquiry Commission to submit to voluntary questioning, resulting in Tuesday's subpoena, Berkshire said.
  
  Carrie Kizer, an assistant to Buffett, confirmed the accuracy of a Fortune magazine article on Thursday that revealed the subpoena and Buffett's resistance to testifying.
  
  Buffett, Moody's Corp Chief Executive Raymond McDaniel, and five other current and former Moody's officials will testify on June 2, as the commission examines credit ratings and how investors use them.
  
  The Congressionally appointed commission is examining the causes of the worst financial crisis since the 1930s and is trying to find flaws that could be remedied through reforms. It is slated to issue a report by December 15.
  
  Moody's is the parent of credit rating agency Moody's Investors Service. Berkshire had a 13% stake in Moody's as of March 31, regulatory filings show.
  
  Buffett is the world's third-richest person, with most of his fortune coming from Berkshire. He has since 1965 run the Omaha, Nebraska-based conglomerate, which now has roughly 80 companies and tens of billions of dollars of investments.

This is the CNBC version: Buffett to Appear Before Financial Crisis Panel

On ZH: Buffett Has "No Comment" On His Sale Of $30MM In MCO Shares Just After Moody's Wells Notice Receipt

• As Zero Hedge first pointed out on Saturday, Moody's is in very big trouble - in its 10Q, in the very last paragraph of the very last page, the company indicated that on March 18, it had received a Wells Notice and a recommendation by the SEC to pursue a Cease and Desist order against the agency's NRSRO status, in effect killing its business model. This was not lost on the market, which punished Moody's stock by 10% yesterday even as every other stock went vertical. When all is said and done the 10% could well become 100%, and as far as the market is concerned nobody would shed a tear: the conflicted rating agency model is long dead, and the independent third party vendors are the only ones that add any actual value at this point. However, far more interesting are the actions by Moody's CEO Raymond McDaniel and key shareholder and kindly grandfather, Warren Buffett, both of whom sold millions worth of Moody's share and stock, the day of, and just after, the Wells notice receipt. The New York Times has reported that Buffett, who recently has not had a problem commenting on pretty much everything, and was vociferously defending not only arch monopolist Goldman Sachs at his annual ukulele outing in Borsheims, but Moody's as well, has had "no comment" on his sales. Perhaps it is time for someone to take Mr. Buffett to task, instead of just to his word: sure, it could be just a coincidence... or three - he sold over $30 million in MCO stock on March 19, March 24 and March 26. Or it might not. However, now that it has become far too clear that nobody in the finance business has a shred of integrity and honesty left, perhaps it is time an independent and impartial jury to decide if any impropriety based on material, non-public insider information, was committed.

Yes, many are not taking it too kindly that Buffett sold millions worth of Moody's share and stock, the day of, and just after, the Wells notice, a Cease and Desist order against the agency's NRSRO status, in effect killing its business model. Yes, Wells notice effectively put the end in Moody's!

Yup. In short, did Berkshire got insider information in its disposal of shares in Moody's?

Here's an older article on NyTimes: Buffett Is Unusually Silent on Rating Agencies

• ...But on the subject of the conflict of interest built into the rating agencies’ business model, Mr. Buffett has been uncharacteristically silent — even though that conflict is especially glaring in his case because one of the companies that Moody’s rates is Berkshire. (Its Aaa rating, for the record, is the same as the one from Standard & Poor’s. Fitch downgraded Berkshire for the first time last week.)
  
  Mr. Buffett also seems to have said nothing about a problem that some contend is just as serious and endemic: because ratings are required in so many transactions, the agencies’ inaccurate ratings have no effect on their own bottom lines. And a company that is paid regardless of its performance is a company that will eventually underperform, says Frank Partnoy, a professor of law at the University of San Diego.
  
  “Imagine if you had a rabbi and said, ‘All the laws of kosher depend on whether this rabbi decides if food is kosher or not,’ ” Mr. Partnoy, a former derivatives trader, told The Times. “If the rules say ‘You have to use this rabbi,’ he could be totally wrong and it won’t affect the value of his franchise.”
  
  The rating agencies have been mislabeling the goods for a long time. “A lot of investors have been eating pork recently,” Mr. Partnoy says, “and they’re not too happy about it.”
  
  Mr. Buffett declined to be interviewed, The Times said. Of course, he has bigger problems on his mind than a company that makes up less than $2 billion of his $127 billion empire....
• “Warren deserves credit for his candor in admitting mistakes,” Alice Schroeder, author of “The Snowball,” a biography of Mr. Buffett, told The Times. “But he chooses which mistakes to discuss. It also pays to listen for the ‘dog that didn’t bark.’ ”
  
  One of those nonbarking dogs, she says, is Moody’s.
  
  “He hasn’t discussed publicly what he might be doing to influence the management at this time of crisis,” she told The Times. “Last spring, he knew the rating agencies were deeply involved with the financial crisis. Since he didn’t sell Moody’s then, he should explain what he’s doing to influence the management.”....

What one should note is that Bershire had started selling Moody's a long time ago.

July 2009: here is a document on SEC showing Berkshire disposal of Moody's shares

That's some 8 million shares disposed back then.

Sept 2009: sec link here

Oct 2009: sec link here

Dec 2009: sec link here

I could go on an on... here's a newsclip on Businessweek: Buffett Sells Moody’s Stock for Sixth Time Since July

• .. By Andrew Frye and Matthew Leising
  
  Dec. 23 (Bloomberg) -- Warren Buffett’s Berkshire Hathaway Inc. cut its stake in Moody’s Corp. for the sixth time since July after the ratings company was hit by profit declines, lawsuits and criticism from regulators.
  
  Berkshire sold 87,992 shares on Dec. 18 for $26.77 apiece and remains Moody’s biggest shareholder, according to a regulatory filing yesterday. Omaha, Nebraska-based Berkshire’s stake is down about 34 percent from the 48 million shares it owned at the end of June.
  
  Buffett buys stocks that he says have lasting competitive advantages and superior management. His stake in the rating firm, whose founder John Moody created credit grades a century ago, dates from 2000 and had a value of more than $3.5 billion at its high in 2007. Moody’s has since dropped by more than half amid criticism that inflated credit ratings during the housing boom exacerbated the recession.
  
  “Moody’s reputation has certainly been tarnished,” said Meyer Shields, an analyst with Stifel Nicolaus & Co. who has a “hold” rating on Berkshire shares. “My sense is he just thinks there’s less value.”...

How? Do you think the criticism is a bit too harsh? Berkshire had started disposing Moody's since 2009 and Berkshire had 48 million shares in Moody's to begin with and probably one should understand the difficulty in disposing 48 million worth of shares.

Did Bank Of America And Citigroup Commit Accounting Fraud?

On CNBC:

• Bank of America and Citigroup incorrectly accounted for billions of dollars in debt over the past three years, according to a report from the Wall Street Journal.
  
  The report highlights a form of corporate borrowing increasingly under scrutiny since the financial crisis began. The loans, known as "repos," or short-term repurchase agreements, allow banks to increase the amount of risk they can take in securities trading.
  
  Both BofA [BAC 15.74 -0.44 (-2.72%) ] and Citigroup [C 3.96 -0.06 (-1.49%) ] disclosed in filings with the Securities and Exchange Commission that they have over the last three years accidentally classified some repos as sales when they should have been classified as borrowings, the newspaper reported. The amounts involved were small for the banks, though they totaled billions.... http://www.cnbc.com/id/37366067

The WSJ article..

WSJ: Bank Of America, Citigroup Incorrectly Hid Billions In Repo Debt

• Bank of America Corp. (BAC) and Citigroup Inc. (C) incorrectly hid from investors billions of dollars of their debt, similar to what Lehman Brothers Holdings Inc. did to obscure its level of risk, company documents show.
  
  In recent filings with regulators, the two big banks disclosed that over the past three years, they at times erroneously classified some short-term repurchase agreements, or "repos," as sales when they should have been classified as borrowings. Though the classifications involved billions of dollars, they represented relatively small amounts for the banks.
  
  (This story and related background material will be available on The Wall Street Journal Web site, WSJ.com.)
  
  A bankruptcy-court examiner said Lehman had been doing the same thing to make its balance sheet look better before it filed for bankruptcy in September 2008, using a strategy dubbed "Repo 105" that helped the Wall Street firm move $50 billion in assets off its balance sheet.
  
  Bank of America and Citigroup say their misclassifications were due to errors--not an attempt to make themselves look less risky, which examiner Anton Valukas said was Lehman's motivation. The disclosures, made after federal securities regulators began asking financial firms about their repo accounting, were included in quarterly filings earlier this month but not highlighted.
  
  The disclosures come amid a series of revelations about how banks obscure their risk-taking before reporting their finances to the public, a practice known in the financial world as "window dressing."
  
  Bank of America and Citigroup were among the banks cited in a page-one Wall Street Journal article on Wednesday detailing how financial firms temporarily shed repo debt at the ends of quarters, when they report their finances to investors. Since the financial crisis began, both banks often have reduced their quarter-end repo debt from their average borrowings for the same quarter. That activity didn't involve misclassifying repo loans as sales.
  
  Repos are short-term loans that allow banks to take bigger risks on securities trades; classifying the transactions as sales instead of borrowings allows a firm to take assets off its balance sheet and thus reduces its reported leverage, or assets as a multiple of equity capital.
  
  Federal securities rules bar financial firms from intentionally masking debt to deceive investors. There is no indication that Bank of America or Citigroup misclassified their repos intentionally or that the Securities and Exchange Commission will take any action against them. An SEC spokesman declined to comment.
  
  The amounts Bank of America and Citigroup cite are relatively small. The misclassifications had tiny impacts on the banks' reported leverage, and none at all on their earnings or shareholder equity. The banks didn't restate any financial statements.
  
  Bank of America said the misclassified transactions in certain quarters over the past three years-ranging from $573 million to as much as $10.7 billion-"represented substantially less than 1% of our total assets" and had no material impact on its balance sheet, earnings or borrowing ratios.
  
  Citigroup said the misclassified transactions-of $5.7 billion as of the end of 2009, and as much as $9.2 billion over the past three years-involved "a very limited number of our business units" that "used this type of transaction in very small amounts." It also said its errors were immaterial to its financial statements. "At no point in time was the impact of these sales transactions large enough to have a noticeable impact on our published leverage ratios."
  
  By comparison, both banks have more than $2 trillion in assets.
  
  The SEC had asked big banks in March for more information about their repo accounting in the wake of the Lehman bankruptcy report. That inquiry hasn't found any widespread inappropriate practices, SEC Chief Accountant James Kroeker told a congressional subcommittee last week.
  
  But Kroeker said the SEC has asked several companies to provide more disclosure about their repo accounting in their securities filings. Bank of America and Citigroup indicated they had found their errors on their own initiative.
  
  More broadly, the SEC is now considering stricter disclosure and a clearer rationale from firms about quarter-end borrowing activities. The agency may extend these rules to all companies, not just banks. The potential new rules, disclosed by SEC Chairman Mary Schapiro at a congressional hearing last month, came two weeks after the Journal's initial article about banks' debt-masking activity.
  
  Separately, Bank of New York Mellon Corp. (BK) said in a securities filing that it had found some small errors in its repo accounting over the past three years. The bank said it didn't use Repo 105 transactions.
  
  The errors have been corrected, and none of them were material to the bank's financial statements, the bank said in the filing. A Bank of New York Mellon spokesman declined further comment.

So CNBC version is incorrectly account... WSJ version was incorrectly hid...

LOL!

Sigh!

So what was at stake?

The amount of debts.

Surely... the amount of debts in a balance sheet is so very crucial for the investor in the street, yes? How can the banks incorrectly account/hid these figures?

Yes it might had no financial impact to the banks earnings but the balance sheet did look better than what it really was had these debts been accounted correctly!

Would it be piss wrong to accuse that this is pure financial shenanigans?

Or would it be wrong to call it fraud?

And these banks are trying to dismiss it as small amount.

My... it's only BILLION of dollars worth of incorrectness!

My.... good or what!

What Hugh Hendry Said About The PIIGS Back On Jan 2009

Dedicated to Solomon:

• solomon said...
  Is this Mr Hugh, the same hedge fund manager that predicted the last fall of Wall Streets?If it is, I think he is the person who bet China economy will slow too.

Regarding Mr.Hugh.

He had feared so for the PIIGS since Jan 2009! This was from a posting from ZH...

• ........ the esteemed Columbia professor, at 4:50 into the clip, asks "How long has this Greek question been on the table. Ablout 10 weeks maybe?" A rather violent explosion from Sachs follows when Hendry calls him out on his tenured stupidity. All this was discussed yesterday. However, we wanted to provide a response to the Ivy League professor, as he did pose a legitimate question. In the following FT interview from January 2009, Hugh Hendry discussed the future of the eurozone and the PIIGS, and at 24 seconds into it, he provides the response Sachs is seeking: "I fear [the collapse of the Eurozone] is becoming more likely." He follows "If we saw parity with the euro, my goodness, that would be deemed to be unthinkable." And concludes, "There is a shortage of dollars. People think I'm crazy - they are printing billions, trillions of dollars. But keep in mind America has $50 trillion of debt outstanding. And that was fine because they thought it had $50 trillion of assets. And what we are discovering is these asset prices deflate - it's vaporization..." Dear Mr. Sachs - the very person you were sitting across the table from foresaw everything to the dot, just as it would happen 16 months later, even as you were calling up old buddies to get that Teacher of the Year award, or get that extra fellowship (in demagoguery?). Our advice to you is do what your parents did, get (an honest) job sire.... which will never happen - pouring the Kool Aid is easy and pays well. So here is our second bit of advice: watch all Hendry appearances, and listen to what he says. He will always ends up right, and you will always be wrong, since you defend a broken system which is fated for implosion. And just as Hendry sees deflation first, then hyperinflation (and watch this clip for some more brilliant insight), so it shall be. And for some reason people like Sachs will once again be invited to roundtables, in which they will goundlessly claim that nobody foresaw any of ensuing Keynesian collapse... So now that we have answered your question, we have one of our own - how does Columbia allow this level of mediocrity to be publicized on national television?

23 Jan 2009.

It's Time To Panic: Debate On European Banking Crisis

Some of the most sensible words said about the European banking crisis.

Taken from an interesting roundtable discussion shown on Newsnight.

• Seriously, says Hugh Hendry. It's time to worry. Panic.
  
  "Banks today are refusing to lend to each other. Bank share prices are collapsing. We have no ability to gauge the credit-worthiness of the banking system."
  
  "I say, let's purge this system of its rottenness," recommends Hendry. "Let's take on a recession. It's going to be tough. People are going to lose their jobs."
  
  "The banking sector is responsible for gross folly," he says. The solution is just, "Don't pay them. Don't reward folly."
  
  "We can spread this over 20 years or we can get rid of it over 3 years... You make a mistake, you pay for it." ( Source: here )

( Here's a new nice article on Hugh Hendry, hedge fund manager of Eclectica Management : here on independent.uk )

Do watch the video...

Comments On Uzma Holdings

Here's another 'one'....

Uzma Holdings was listed on July 2008.

On Oct 2008, it was featured in Businessweek article: Hot on the oil trail

• ..... Uzma has made a net profit forecast of RM14.7mil on the back of RM190mil revenue for year ended December 2008. Up to June 2008, Uzma has delivered a net profit of RM6.8mil on revenue of RM69.38mil.
  
  Kamarul says the company is confident of achieving its profit forecast, as the bulk of contracts comes in the second half of the year.
  
  ... With oil prices having dipped from its peak of US$147 in July to about US$67 recently, is there still interest and feasibility in exploration?
  
  Kamarul is confident of the oil and gas industry remaining robust as there is still no alternative to fossil fuel.
  
  “We started our business when oil prices were at the US$12 level. If we can sustain at US$12 per barrel, I think we can pretty much sustain at these levels,” says Kamarul.
  
  He foresees oil prices remaining high, as the difference between demand and supply for oil has narrowed significantly in the last 5 years.
  
  “At US$60, oil producers are still very profitable as the lifting cost of oil is US$16 to US$20.

Feb 2009: Quarterly rpt on consolidated results for the financial period ended 31/12/2008

Uzma Q4 earnings came in at 3.201 million. Net earnings for its firscal year after listing was 10.779 million.

11 May 2009. Uzma expects double-digit growth in net profit

• Uzma expects double-digit growth in net profit
  Written by Yantoultra Ngui Yichen
  Monday, 11 May 2009 10:37
  
  KUALA LUMPUR: Uzma Bhd, an upstream oil and gas services company, expects to record double-digit growth in net profit for the fiscal year ending Dec 31, 2009 (FY09) on the back of new potential contracts coming in and the launch of its proprietary service technology.
  
  Its chief executive Datuk Kamarul Muhamed said the Second Board-listed company was confident of securing a major portion of the RM1.2 billion worth of contracts it was currently bidding for, both locally and overseas.
  
  “We are confident based on the successful applications of our new service package - uzmAPRES - in pilot studies and we are currently patenting the technology,” he told The Edge Financial Daily.
  
  “Hopefully by August this year, we will know the outcome of a major portion of our bidding process.”.....

Double digit growth...

29 May 2009: Quarterly rpt on consolidated results for the financial period ended 31/3/2009. Net earnings slipped to 1.044 million.

21 Nov 2009.

• INTERNATIONAL oil and gas services provider Uzma Bhd, which is spreading its wings in Mongolia, has found more oil at the inner parts of the country with its first venture into new territory of on-shore heavy oil.
  
  Uzma said its growth in the region of inner Mongolia is now imminent with the successful completion of the Baiyin Chagan Da-9 drilling campaign.
  
  The wells can produce an estimated 65 million barrels of oil per day...

On the same day Uzma diversifies into exploration and production

Two days later, 23 Nov 2009: Quarterly rpt on consolidated results for the financial period ended 30/9/2009. UZMA lost 1.832 million!

Company said the following..

• Compared to the previous quarter, the Group’s revenue has reduced by RM8.32 million in the current quarter representing a decrease of 28.1%. The decrease in Group’s revenue was mainly due to delay in awarding new contracts by customers and delay in project completion of existing projects and in the current quarter.
  
  In addition, the Group has recorded a loss before taxation of RM2.38 million in current quarter as compared to a profit before taxation of RM2.56 million in previous quarter. The loss before taxation in current quarter was mainly due to weaker sales in the current quarter as highlighted above and higher operating expenses incurred in the current quarter. The increase in operating expenses was mainly due to higher staff cost incurred in the current quarter.

3 months later, Feb 2010. Quarterly rpt on consolidated results for the financial period ended 31/12/2009

Uzma lost 8.429 million for the quarter!

• The decrease in revenue was mainly due to slower completion of existing projects in 2009 from Geoscience and Reservoir Engineering division (“GRE”). The GRE’s revenue has decreased from RM30.43 million in 2008 to RM17.18 million in 2009, representing a decrease of RM13.25 million or 43.54%. In addition lower sales are recorded in Resource Management division (“RMS”). The RMS’s revenue has decreased from RM88.59 million in 2008 to RM67.35 million in 2009 representing a decrease of RM21.24 million or 24.00%.
  
  In line with decrease of revenue mentioned above, the Group’s gross profit has also decreased from RM31.72 million in 2008 to RM18.41 million in 2009.
  
  As a consequence of the lower revenue and gross profit recorded, the Group has recorded a loss before taxation of RM7.41 million in 2009 as compared to a profit before taxation of RM13.11 million in 2008. We wish to highlight that the losses incurred in 2009 was also due to higher operating expenses incurred by the Group in 2009 and additional cost incurred for setting up a new division which is expected to commence business activity by second quarter of 2010. In addition, the management had on prudence ground, make provision for doubtful debts for certain long outstanding amounts.

So UZMA lost 7.457 million for the fiscal year.

Last night, UZMA reported its earnings.
Quarterly rpt on consolidated results for the financial period ended 31/3/2010

It lost money yet again, 2.676 million. 3 consecutive quarters of losses!

Company comments...

• Compared to quarter 1 (“Q1”) 2009, the Group’s revenue in Q1 2010 has decreased by RM5.56 million, representing a decrease of 21.4% .
  
  The decrease in revenue was mainly due to slower completion of existing projects in Q1 2010 from Geoscience and Reservoir Engineering division (“GRE”). The GRE’s revenue has decreased from RM5.49 million in Q1 2009 to RM3.07 million in Q1 2010, representing a decrease of RM2.42 million or 44.1%.
  
  In line with decrease of revenue mentioned above, the Group’s gross profit has also decreased from RM6.08 million in Q1 2009 to RM3.26 million in Q1 2010.
  
  As consequences of the lower revenue and gross profit recorded, the Group has recorded a loss before taxation of RM2.63 million in Q1 2010 as compared to a profit before taxation of RM1.53 million in Q1 2009. We wish to highlight that the losses incurred in Q1 2010 was also due to higher operating expenses incurred by the Group and additional cost incurred for setting up a new division which is expected to commence business activity by second quarter of 2010.
  
  
  
  Compared to the previous quarter, the Group’s revenue has decreased by RM1.45 million in the current quarter representing a decrease of 6.6%. However, the Company’s loss before taxation has reduced by RM11.58 million representing a decrease of 81.5%. The reduction was mainly due to allowance for doubtful debts made in previous quarter.

How?

UZMA last traded 1.74.

Do You Really Believe That This Economy Recovery Is Real

Here's another interesting posting.

25 Questions To Ask Anyone Who Is Delusional Enough To Believe That This Economic Recovery Is Real

1. In what universe is an economy with 39.68 million Americans on food stamps considered to be a healthy, recovering economy? In fact, the U.S. Department of Agriculture forecasts that enrollment in the food stamp program will exceed 43 million Americans in 2011. Is a rapidly increasing number of Americans on food stamps a good sign or a bad sign for the economy?
2. According to RealtyTrac, foreclosure filings were reported on 367,056 properties in the month of March. This was an increase of almost 19 percent from February, and it was the highest monthly total since RealtyTrac began issuing its report back in January 2005. So can you please explain again how the U.S. real estate market is getting better?
3. The Mortgage Bankers Association just announced that more than 10 percent of U.S. homeowners with a mortgage had missed at least one payment in the January-March period. That was a record high and up from 9.1 percent a year ago. Do you think that is an indication that the U.S. housing market is recovering?
4. How can the U.S. real estate market be considered healthy when, for the first time in modern history, banks own a greater share of residential housing net worth in the United States than all individual Americans put together
5. With the U.S. Congress planning to quadruple oil taxes, what do you think that is going to do to the price of gasoline in the United States and how do you think that will affect the U.S. economy?
6. Do you think that it is a good sign that Arnold Schwarzenegger, the governor of the state of California, says that “terrible cuts” are urgently needed in order to avoid a complete financial disaster in his state?
7. But it just isn’t California that is in trouble. Dozens of U.S. states are in such bad financial shape that they are getting ready for their biggest budget cuts in decades. What do you think all of those budget cuts will do to the economy?
8. In March, the U.S. trade deficit widened to its highest level since December 2008. Month after month after month we buy much more from the rest of the world than they buy from us. Wealth is draining out of the United States at an unprecedented rate. So is the fact that the gigantic U.S. trade deficit is actually getting bigger a good sign or a bad sign for the U.S. economy?
9. Considering the fact that the U.S. government is projected to have a 1.6 trillion dollar deficit in 2010, and considering the fact that if you went out and spent one dollar every single second it would take you more than 31,000 years to spend a trillion dollars, how can anyone in their right mind claim that the U.S. economy is getting healthier when we are getting into so much debt?
10. The U.S. Treasury Department recently announced that the U.S. government suffered a wider-than-expected budget deficit of 82.69 billion dollars in April. So is the fact that the red ink of the U.S. government is actually worse than projected a good sign or a bad sign?
11. According to one new report, the U.S. national debt will reach 100 percent of GDP by the year 2015. So is that a sign of economic recovery or of economic disaster
12. Monstrous amounts of oil continue to gush freely into the Gulf of Mexico, and analysts are already projecting that the seafood and tourism industries along the Gulf coast will be devastated for decades by this unprecedented environmental disaster. In light of those facts, how in the world can anyone project that the U.S. economy will soon be stronger than ever?
13. The FDIC’s list of problem banks recently hit a 17-year high. Do you think that an increasing number of small banks failing is a good sign or a bad sign for the U.S. economy?
14. The FDIC is backing 8,000 banks that have a total of $13 trillion in assets with a deposit insurance fund that is basically flat broke. So what do you think will happen if a significant number of small banks do start failing?
15. Existing home sales in the United States jumped 7.6 percent in April. That is the good news. The bad news is that this increase only happened because the deadline to take advantage of the temporary home buyer tax credit (government bribe) was looming. So now that there is no more tax credit for home buyers, what will that do to home sales?
16. Both Fannie Mae and Freddie Mac recently told the U.S. government that they are going to need even more bailout money. So what does it say about the U.S. economy when the two “pillars” of the U.S. mortgage industry are government-backed financial black holes that the U.S. government has to relentlessly pour money into?
17. 43 percent of Americans have less than $10,000 saved for retirement. Tens of millions of Americans find themselves just one lawsuit, one really bad traffic accident or one very serious illness away from financial ruin. With so many Americans living on the edge, how can you say that the economy is healthy?
18. The mayor of Detroit says that the real unemployment rate in his city is somewhere around 50 percent. So can the U.S. really be experiencing an economic recovery when so many are still unemployed in one of America’s biggest cities?
19. Gallup’s measure of underemployment hit 20.0% on March 15th. That was up from 19.7% two weeks earlier and 19.5% at the start of the year. Do you think that is a good trend or a bad trend?
20. One new poll shows that 76 percent of Americans believe that the U.S. economy is still in a recession. So are the vast majority of Americans just stupid or could we still actually be in a recession?
21. The bottom 40 percent of those living in the United States now collectively own less than 1 percent of the nation’s wealth. So is Barack Obama’s mantra that “what is good for Wall Street is good for Main Street” actually true?
22. Richard Russell, the famous author of the Dow Theory Letters, says that Americans should sell anything they can sell in order to get liquid because of the economic trouble that is coming. Do you think that Richard Russell is delusional or could he possibly have a point?
23. Defaults on apartment building mortgages held by U.S. banks climbed to a record 4.6 percent in the first quarter of 2010. In fact, that was almost twice the level of a year earlier. Does that look like a good trend to you?
24. In March, the price of fresh and dried vegetables in the United States soared 49.3% - the most in 16 years. Is it a sign of a healthy economy when food prices are increasing so dramatically?
25. 1.41 million Americans filed for personal bankruptcy in 2009 – a 32 percent increase over 2008. Not only that, more Americans filed for bankruptcy in March 2010 than during any month since U.S. bankruptcy law was tightened in October 2005. So shouldn’t we at least wait until the number of Americans filing for bankruptcy is not setting new all-time records before we even dare whisper the words “economic recovery”?

Regarding Point 7: "Dozens of U.S. states are in such bad financial shape" ...

How about this article from http://www.economicpolicyjournal.com/2010/05/32-states-have-borrowed-from-treasury.html

• EconomicPolicyJournal.com has learned that 32 states have run out funds to make unemployment benefit payments and that the federal government has been supplying these states with funds so that they can make their payments to the unemployed. In some cases, states have borrowed billions.......

32 out of 50 states have run out of funds????

Think about that.

China Crash Unlikely, India Yes!

Same old statement made: China crash unlikely but India’s outlook less rosy

• Thursday May 27, 2010
  China crash unlikely but India’s outlook less rosy
  CAPITAL TALK
  
  WE all know that there is an endless list of people, at least based on what is being reported in the Western mass media, forecasting that China’s economy will crash soon.
  
  Based on the latest April data on China’s property price, bank lending and inflation rate, it would appear that all the dire forecasts for China are unfolding right in front of our eyes.
  
  As i Capital has advised repeatedly, it does not see China crash landing this or next year. In fact, it continues to see a soft landing in the coming months.
  
  By focusing on China, what the China bashers have not shown is that between the two emerging Asian giants of India and China, India should be the economy that is heading for a crash.
  
  
  
  The three charts above show key economic statistics for these emerging giants.
  
  India’s situation is somewhat similar to Greece. She has persistent and high levels of budget deficit, external trade deficit and also a high inflation rate.
  
  In contrast, China’s economy is better managed. Despite such contrasting economic performance, why is it that China is forecast to crash and not India?
  
  Is it because China has some problems with some minorities? The China bashers love to highlight Tibet and Xinjiang as China’s major trouble spots. This cannot be because the social problems that India faces are even more serious than China’s.
  
  In 2006, Prime Minister Manmohan Singh called the Naxalites “the single biggest internal security challenge ever faced by our country.”
  
  In 2009 he said that India was “losing the battle against Maoist rebels.” The Naxalites are very popular and growing in popularity in India. So why zoom in only on China?
  
  The answer is simple.
  
  To the China bashers, India is seen as a rare Asian democracy which they will go all out to portray as the model nation.
  
  In contrast, China is still portrayed as a communist country and they would go all out to discredit her as a successful nation, and if possible to cause the country to break up.
  
  Unfortunately, the facts of the matter do not support such a conclusion.
  
  No matter how one looks at it, China’s economy is not ready to crash.
  
  Based on anecdotal evidence, the property bubblet is already being busted. Property prices are already peaking.
  
  The numerous measures need time to take effect.
  
  The economic and housing data in the coming months will be more reflective of the underlying trend and thus more accurate.

See also Possible Sign Of China's Manufacturing Slowing?

China still portrayed as a communist country?

Why divert attention to India?

Clinton Warns North Korea And How Did North Korean Subs Responds?

Well here is another worry.

http://www.todayonline.com/World/EDC100527-0000104/N-Korean-subs-go-Awol

• N Korean subs go Awol
  05:55 AM May 27, 2010
  SEOUL - United States Secretary of State Hillary Clinton warned North Korea yesterday halt its "provocations and policy of threats" and said the world must respond to its sinking of a South Korean warship.
  
  Mrs Clinton, who was visiting Seoul to show solidarity amid rising inter-Korean tensions, also said the US was reviewing additional options to hold the North accountable.
  
  North Korea threatened yesterday to shut a border crossing and open fire on loudspeakers if South Korea makes good on its vow to blare out propaganda across the tense frontier.
  
  Military tensions are high after the South last week accused the North of sinking a warship in a submarine torpedo attack in March.
  
  The South on Monday announced a package of reprisals, including a halt to most trade with its neighbour. It is also mounting a diplomatic drive to punish the North through the United Nations Security Council, although veto-wielding member China is reluctant to sign up.
  
  The North, which denies involvement, announced late on Tuesday that it was cutting all ties with the South.
  
  Meanwhile, South Korea's military is trying to track four North Korean submarines which disappeared from radar screens after leaving a base this week, officials said yesterday.
  
  Yonhap news agency quoted an unidentified military official saying "it's quite rare that a multiple number of North Korean submarines have left no traces for two straight days. We're trying to find them by using all naval capabilities in the Sea of Japan". North Korea reportedly operates 40 Sang-O class submarines.
  
  The US on Tuesday announced a plan to carry out an anti-submarine exercise in the Yellow Sea soon, jointly with the South Korean navy. AFP

Multiple number os submarines have disappeared.

Irony. U.S. Intelligence Sees Scant Evidence That North Korea Is Preparing for War

• Despite all the recent huffing and puffing from Pyongyang, U.S. officials say they've seen little physical evidence that North Korea might actually be preparing to go to war. Just hours after Seoul blamed the North for the March 26 sinking of the South Korean naval vessel Cheonan, North Korean leader Kim Jong-il publicly ordered his armed forces to get ready for military action, according to sources quoted in The Guardian. But two U.S. national-security officials, asking for anonymity when discussing sensitive information, tell Declassified they're not aware of any intelligence reporting on significant military mobilization or redeployments inside North Korea. The North Korean military is always on the move somewhere, one of the officials said, but at the moment whatever movements are being noted by Western intelligence agencies are regarded as not particularly threatening. A third U.S. foreign-policy official, who also asked for anonymity, told Declassified that U.S. agencies are picking up "nothing of extreme concern" in what North Korean forces are currently up to.

Could these US Intelligence explains why the four subs went dark?

What if war starts between these two Koreans countries?

How?

So What Is OSK Saying Now About MMC

Blogged this morning. Comments On MMC Earnings

Just got a copy of OSK latest report on MMC.

Here's OSK comments.

• MMC’s results disappointed again, pulled down by continued losses at Zelan and high tax and MI rates. While we expect the high tax and MI rates to normalize, the disappointment at Zelan leads us to forecast zero associate earnings for 2010 and strip out Zelan from of our Sum of Parts value for MMC. Due to the lower net profit forecast (down 5%-6%) and a higher attributed WACC due to market volatility, our SOP fair value is reduced to RM2.54. Nonetheless, there is still value in the company, and the upcoming 10MP as well as hopes for expansion of the Tanjung Bin power plant prompt us to maintain our Trading Buy call.
  
  

So it's Zelan's losses, higher tax rates and MI rates.

It's not the fault of the researcher who had assigned such incredible earnings forecast of 424 million.

Yeah, MMC is only expected to see an earnings growth of ONLy 79.3%.

So if MMC disappoint, it's not all MMC's fault and not the fault of the researcher who assign such an incredible earnings forecast.

Hey, researcher cannot be wrong, yes?

Now here comes another incredible thing.

MMC only earned some 34.3 million for the first quarter. OSK did revised down the earnings forecast for MMC.

Earnings estimate fell from 424 million to 399.1 million. Yeah, OSK downgraded the earnings estimate to 399.1 million.

Yeah, after MMC earnings on a Q-Q basis fell from 107.7 million to 34.3 million, OSK still expects MMC to have a yearly growth of some 68.6%!!!

WOW!

No wonder MMC is still considered a trading buy despite having its target price revised down from 2.80 to 2.54.

Incredible!

Let's see.. one year has 4 quarters. First quarter MMC only earned some 34.3 million. To reach 399.1 million, MMC needs to earn some 364.8 million for the remaining 3 quarters!. Oh, this equates to roughly an earnings of rm 121.6 million per quarter.

LOL!

Good or what??!!

Comments On MMC Earnings

I just saw Business Times article on MMC earnings.

• Power, ports drive MMC profit jump
  
  Published: 2010/05/26
  
  MMC Corp Bhd (2194), a power producer and port operator, said its first quarter net profit rose by a tenth, driven by its power and logistics businesses.
  
  The group, controlled by Tan Sri Syed Mokhtar Al-Bukhary, expects to do better for the year to December 31 due to a better Malaysian economy. It made a net profit of RM236.7 million for 2009.
  
  MMC made a net profit of RM34.4 million for the quarter to March 31. Revenue was up 8.2 per cent to RM2.1 billion. Its pre-tax profit jumped by almost a third to RM210.4 million.
  
  The group's energy and utilities division, which posted a revenue of RM1.7 billion in the quarter, reported improved results. Its share of the group's pre-tax profit rose by 19 per cent.
  This was "mainly driven by better performance of Malakoff Corp Bhd and higher volume gas sold by Gas Malaysia Sdn Bhd," MMC said in a statement to Bursa Malaysia.
  
  Its transport and logistics division's share of pre-tax profit surged 75 per cent due to higher throughput volume from port business, following the global economic recovery.
  
  However, there was lower contribution from its engineering and construction division due to the lower contribution from the double-track railway project. This is due to revisions in the overall margin, MMC said.
  
  Shares of MMC fell 1.3 per cent to close at RM2.26 yesterday.

It is sounding good eh?

Then I look more carefully.

That one line "It made a net profit of RM236.7 million for 2009." made me curious.

Last year, it made 236.7 mil. Now the first quarter it only made 34.4 million. At this rate, surely MMC would make much less money.

Time to do some digging. :D

Feb 2010: Quarterly rpt on consolidated results for the financial period ended 31/12/2009. MMC made 107.7 million.

Nov 2009: Quarterly rpt on consolidated results for the financial period ended 30/9/2009. MMC made 90.534 million.

Doh!

MMC said it made only 34.4 million!

Then I realised something..... hey... Mr. OSK, did write something on MMC and I blogged on it. OSK's What If Blue Sky Valuation! LOL! the report was written by Head of research, himself, Chris Eng! Hello Is The Stock Market Heading For Better Times Or .... Not???

Hmm... my mind started racing. LOL!

Seriously... LOL!

I was so excited... cos...I forgot how OSK made their valuation on MMC already and I was wondering how is MMC earnings compared to OSK's forecast made.

Oh my!!!!!!!!!!!!!!!!!

Quote:

• While we are conservatively sticking to our earnings forecast for now

Chris Eng's conservative forecast earnings for MMC Corp was rm 424.2 million!!!!!!

Come lah.. how can this be considered conservative when the earnings forecast was assumed to grow at 79.3% this year!!!!!!!!!!

Does earnings grow so easily????

79.3%!

LOL!

Oh... MMC only earned 34.4 million!!!!!!!!!!!!!!!

How lah?

JP Morgan Sell Call On National Bank Of Greece

The following posting on Zero Hedge just needs to be highlighted:

After 70% Plunge, JPMorgan Cuts National Bank Of Greece From Buy To Sell

• This is Wall Street value added at its purest. The day when the stock price of National Bank of Greece (NBG) is trading within millimeters of its all time low set during the March 2009 lows, and following a 70% straight decline from highs hit in September of last year, JPMorgan analyst Paul Formanko has officially submitted his bid for the client wealth destroyer of the century title (despite the guaranteed shoe-in of every Goldman Sachs "sellside analyst" for this title), by downgrading the soon to be insolvent Greek firm (which as even Formanko acknowledges has >200% of core equity exposure to GGBs) from Overweight to Underweight. The stock which now trades at around €10/share was initiated by Paul with an Overweight in May 2008, a rating from which he has never wavered, with just his price target moving up and down. His most recent PT on NBG: €25/share. Yet something happened between yesterday and today: Paul decided that the firm is no longer worth his old price target... or even half of it. His new expected price: €9.80, a 60% discount for all those who were dumb enough to listen to Paul as recently as yesterday, not just when he slapped a €45 price target at initiation in May 2008, or a €36 PT in September of 2009. And just to prove that Paul is man of action, he has also gone and downgraded every single Greek bank in his coverage universe from Overweight or Neutral to Underweight with a comparable price target cut.

Do read the rest of the posting: here

Oh KNM, Can You Please Buyout The Company At 90 Sen?

I looked at KNM's earnings reported last night.

Less anyone forget I wrote Why I Also Like KNM A Whole Lot and Why I Like KNM Even So Much More Today! and I Just Like KNM So So So Much just last month.

So what was I going to expect I asked myself. Here we have a company who is run and managed by a person, who is also the Managing Director and Chairman of the company, who had been busy attempting to buyout the rest of the company. Yeah, what can we expect, he has been rather busy. How nice. What a caring owner we have here. The minority shareholders should be so pleased.

Before I look into it's earnings, there was one interesting side note. On Feb 2010, KNM reported its 2009 Q4 earnings. Quarterly rpt on consolidated results for the financial period ended 31/12/2009. It was said KNM lost some 31 million.

But end April this figure was adjusted due to tax incentive. Deviation Between Announced Unaudited Financial Statements And Audited Financial Statements For the Year Ended 31 December 2009. KNM's profits were adjusted higher by 94.6 million, thanks to the "recognition of tax incentive granted for Borsig acquisition".

Earlier this month, KNM had a feature article on Business Times. ( Sometimes, it's good to read these comments and then compare it to the company's earnings. Hey we need to know if the article is trying to scare the investors away, yes? :D )

• KNM Group expects to perform better this year
  
  Published: 2010/05/04
  
  PROCESS equipment manufacturer KNM Group Bhd (7164) expects to perform better this year on lower tax rates and higher exploration and production activities.

Moolah: Ok... KNM is given a huge helping hand from taxes.

• "We recently spoke to the management of KNM following the breakdown of its proposed takeover offer. We believe that investors have overlooked the business aspect in the last few months after the takeover news first broke off back in February 2010," wrote HWANGDBS Vickers Research Sdn Bhd (HDBSVR) analyst Lee Wee Keat in a note to clients yesterday.

Moolah: Excuse me, Mr. Lee Wee Keat. What can the investors do? Should we watch the business aspect? Should we? We are not even sure if the management is busy watching the business aspect themselves since they are so busy trying to buyout the minority shareholders. Some naughty and bad investors are saying 'why bother'. Mr. Lee, you should drill some sense into them.

• KNM's substantial shareholder and group managing director Lee Swee Eng had recently aborted his proposed offer via Bluefire Capital Group to buy KNM's entire business at RM0.90 per share.

Moolah: KNM now so cheap. Its only 48 sen. Here's a tip to KNM management. In my flawed opinion, if you do a proper takeover at RM0.90 per share, I believe many minority shareholders and funds would be soooooooooooo happy to sell to you now. How?

• Last year was a bad year for KNM as oil majors held back spending in view of low and volatile oil prices.

Moolah: OOoooo... oil prices now even lower. How?

• "We understand that KNM managed to secure only RM1.5 billion worth of jobs last year, and capacity utilisation was only 65 per cent compared with 80 per cent in 2008.

Moolah: Mr. Lee, as an analyst, do not understand la. Why don't you get proper confirmation before you make such statement? If not, if the management denies such statement, then how? Yaloh, what if KNM says they got more contracts, then how?

• "(Profit) margins for the jobs secured were also slimmer as intense competition over the modest number of jobs available led competitors to cut prices," he said.
  
  Lee expects margins for the next few quarters to remain sluggish as the company completes jobs secured last year. He estimated that the average completion ranges from 15 to 18 months per project.
  
  "We gather that margins have improved since, but have yet to recover to previous levels."
  
  Lee also said concerns over KNM's orderbook replenishment persists.
  
  "KNM has a RM2.4 billion orderbook, with RM400 million of new contracts secured thus far. This is slow, but we foresee a rise in exploration and production activities in the second half of this year to trigger contract flows."
  The group currently has a RM11 billion tender book comprising jobs mostly in the Middle East and Europe.
  
  However, Lee has cut his new wins assumption for KNM to RM1.7 billion from RM1.8 billion previously for the financial year ended December 31 2010 (FY10), based on current tender book and historical hit rate of 15 per cent.
  
  KNM's FY09 audited net profit stood at RM260.6 million after adjusting for the tax incentive, which was granted by the Finance Ministry on April 7 2010 to its subsidiary KNM Process Systems Sdn Bhd for the acquisition of Borsig.
  
  Totalling RM1.4 billion, the tax incentive will apply for a period of four years from 2009.
  
  "We expect a lower tax rate going forward as local operations will be spared from paying taxes. Also, there was no impairment charge for Borsig. Borsig contributed about 45 per cent of total FY09 earnings," said Lee.
  
  The research firms has upgraded KNM to "hold" from "fully valued", but lowered its target price to RM0.60 from RM0.65.
  
  "We expect some overhang in the share price given the EPF's recent heavy selling, but at the current price level, we believe that most of the negatives have been priced in. KNM has also started to buy back its shares.
  
  "We believe KNM's strong RM571.7 million cash balance should support more buyback on share price weakness," said Lee.

Strange. This was basically an article based on HWANGDBS Vickers Research Sdn Bhd (HDBSVR) analyst Lee Wee Keat notes. Why the article titled 'KNM Group expects to perform better this year'? Why ah?

So how?

Time to take a guess.

KNM has got huge tax benefit. 1.4 billion woh. No play-play, yes? With so much incentive, I am going to guess that its net earnings should easily be more than 100 million.

That was my guess.

And I was wrong.

LOL! Yeah, wrong again.

Last night, KNM's earnings before tax fell to just a mere 245 thousand but its final net profit came in at 40.334 million many thanks to deferred taxes.

How? Is this very happening set of earnings or what?

On the Edge Financial : KNM's 1Q net profit falls 60%

• KUALA LUMPUR: KNM GROUP BHD []'s net profits for the first quarter (1Q) ended March 31, 2010 fell by 59% to RM40.33 million from RM98.45 million a year earlier as revenue declined nearly 30% to RM373.3 million on the back of lower utilisation of capacity.
  
  Meanwhile, profit before tax fell to RM249,000 in 1QFY10 from RM124.9 million a year ago. It recorded basic earnings per share of 1.02 sen from 2.51 a year ago.
  
  Compared to the preceding quarter, revenue is lower by 10.38% compared to 4QFY09's revenue of RM416.52 million. However, its profit before tax and minority interest at RM249,000 is better than the 4Q loss before taxation and minority interest of RM80.9 million.
  
  In a filing to Bursa Malaysia, KNM said the difference in the profitability was due to one off foreseeable losses provided in the previous quarter.
  
  KNM's board maintained that it is confident that the group will “continue to be profitable” for FY2010.
  
  At its close on Tuesday, May 25, the stock fell two sen to 48 sen and was the second most actively traded counter on the local bourse.

RM 249 thousand profit before tax is better.... better???

Nice that KNM Group decided to make a comparison when their profit before tax is only rm 249 thousand.

Anyway, I was looking at company's balance sheet.

KNM cash is at 496 million. Lots of money eh? ( Oops... Mr. Lee from HWANGDBS Vickers Research Sdn Bhd noted in early May that KNM had some 571 million!) Of course some would argue that despite the drop, KNM is very rich. Cash rich.

But what about debts?

Oh KNM only has some total debts of 1.157 Billion.

How?

Oh KNM, can you please, please, please, please buyout the company at 90 sen????

Pretty please?

Quick Comments On MBM's Earnings

Ok.. here's a set of really decent earnings announced.

From the company earnings notes.

• Group Financial Performance
  First quarter ended 31 March 2010 compared with first quarter ended 31 March 2009
  The Malaysian motor TIV of sales by registration improved in the first quarter of 2010 by 24.2% compared against the same period of 2009. Similarly, it improved by 6.1% over the preceding quarter.
  
  Group revenue improved by 47.9% to RM363.8 million. Profit from operations improved by 192.8% to RM14.7 million, whilst share of results of associate companies improved by 400.2% to RM30.6 million. Net profit attributable to owners of the Company improved by 327.3% to RM40.0 million.
  
  The group's net cash position (after total borrowings) more than doubled to RM111.6 illion as at 31 March 2010 compared with RM54.7 million as at 31 March 2009 (refer note 24).
  
  First quarter ended 31 March 2010 against previous quarter ended 31 Dec 2009
  Group revenue improved by 24.4%. Profit from operations improved by 74.9%, whilst share of results of associate companies improved by 76.8%. Net profit attributable to owners of the Company improved by 92.9%.
  
  The group’s net cash position (after total borrowings) declined to RM111.6 million as at 31 March 2010 compared with RM120.3 million as at the end of 31 December 2009.
  
  Net assets per share rose to RM3.83 as at the end of March 2010 from RM3.69 as at end of December 2009.
  

Source: here

How?

This sector is doing well yes?

Could this strong trend last?

Would the recent hike in rates have an impact in the future?

The company said the following of its prospects.

• Prospects
  The demand for the vehicles the Group offers remains strong. Based on the outstanding orders to date, revenues are expected to continue to improve. Profitability will consequently be determined by this and by the Ringgit's strength, which if sustained, will reflect on the revenue growth of the Group.
  The new dealerships that commenced operations recently, namely Volkswagen, Mitsubishi and Hino, are contributing positively and will provide an added boost to the performance of the Group for the remainder of the year.
  
  

ps: I have to give credit because I do remember some of my not so optimistic comments on this company before a couple of years ago. :D
ps/ps: Is this a stock tip? Well... I have no idea if you can lose money or not. So follow me not.

:D

Lion Forest Earnings

Earnings time yet again. I opened Lion Forest earnings announcement. I wrote on it before. Some Comments On Lion Forest

It said it made some 18.969 million.

My first thing, look at the balance sheet. Sadly I did not have much to read.

Amount owing by associates = 246.763 million!!!!!!!!!

Since when Lion Forest became a bank and started lending money???

My oh my.... such a practice is still allowed???

Sigh.

Is The Stock Market Heading For Better Times Or .... Not???

On May 7th 2010, OSK Research Head, Chris Eng said Stock market heading for better times

• ... economy will be back in business in 2011, and the stock market will be better than what it is now, said OSK Investment research head Chris Eng.
  
  “With the listing of Petronas’ (Petroliam Nasional Bhd) units in the second half of the year, there will be a spillover into the oil and gas play.
  
  “The Sarawak state election should also provide some excitement. Things should go back to normal by year-end,” Eng said during the launch of OSK’s Top Malaysian Small Cap Book: 50 Jewels.
  
  Eng added that most of his clients were now trading in the market, although clients who had global headquarters were still cautious. According to him, the next few months will be choppy with a mixture of positive and negative headlines, but all these are temporary factors.
  
  Eng has a year-end FBMKLCI target of 1,465 for 2010, and a fair value target of 1,580 for 2011....
  
  

Now it's ONLY May 24th 2010, in the Edge Financial Daily, Volatile landscape for FBM KLCI, Eng was quoted to have said the following:

• ...OSK Research head of research Chris Eng said while the current market weakness raised concerns, it was largely within the research house’s expectation.
  
  Eng foresees a volatile landscape for the FBM KLCI, which is expected to trade at between 1,250 and 1,400 within the next five months.
  
  “We are still hopeful of a stronger year-end once the sovereign debt crisis in Europe subsides,” Eng said in a research note.
  
  
  This article appeared in The Edge Financial Daily, May 24, 2010.

You can also read this: OSK Research still hopeful of a stronger year-end

Tada... the FBM KLCI target is NOW only expected to trade between 1250 and 1400!

May 7th 2010, the stock market is headed for better times, a target of 1465 was expected. Today the target is now only 1250 and 1400!!!!

Good or what???