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Monday, 25 June 2012

There's something about Mary

Prospective investors on Mary Chia (MC) must not be blinded by its full year results (15M12) announced on 30 May.  MC has changed its full year financial year in 2011 to end it on 31st March 2012 which means that it is a 15-months financials.  For a more meaningful comparison, reference should be made to the 12-months financials (12M11) released on 10 Feb instead.

Revenue :- 15M12 +26.6%, 12M11 -27.2%.  MC doesn't report quarterly results so there is no comparison of 1st 3 months results versus year ago.  Under usual 12 months results, MC was in bad shape in 12M11.

Profit b4 tax :- 15M12 -$748k, 12M11 -$757k, 12M10 $2,221k

Staff costs (average per quarter) :- 2012 (1st 3 months) $2,033k, 2011 $1,776k, 2010 $1,398k.  Reasons for the significant increases as explained because of  increased headcount for new outlets, higher commissions payout in line of higher sales during 1H11, sharp increase in staff salaries.  It will be interesting if more information on the exact amount of the staff costs is available.

Gross profit margin :- this interesting info is not available so it is not possible to deduce whether there was any significant negative impact due to  competition.

Other operating expenses (average per quarter) :-  2012 (1st 3 months) $1,845k, 2011 $2,104k, 2010 $1,901k.  This expenses category seems 'under' control for now. 

Current ratio :- 15M12 at 0.39, 12M11 at 0.49, 12M10 at 0.16.  Improving versus 2010 but it probably requires many more years to achieve a 1 for 1 asset covers.

Inventories :- 2012 (1st 3 months) $754k, 2011 $678k, 2010 $515k.  I reckon current status of high or increasing inventories levels is quite dangerous unless it is backed by an increasing backlog orders?

Borrowings :- l am wondering how is it possible an audited 2010 info changed between current liabilities and non-current liabilities when 2011 results was announced on 30 May and 10 Feb?  Weird!

Working capital/cash flow :-  as reported - "The Group reported negative working capital of S$8.6 million as at YE2012 as compared to S$25.2 million as at YE2010. Notwithstanding this, the Group had a cash balance of S$2.6 million as at YE2012.  The Group is considering a fund raising exercise, and is confident that its current cash balance will be able to support its operation for the next 6 months. The Group is considering various forms and options of funds raising exercises, one of which will be divesting".

The pathetic cash balance of $2.6mil is able to cover the next 6 months operation???  Really interesting.  Anyways, MC needs to raise funds, very urgently.

Last done Stock price (@ 22 June) :- 6.5cents, 52 weeks H/L 14.0cents/6.2cents

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