S$143.42 dividends received.
(Cambridge Ind REIT: S$23.42; AIMS AMP Ind REIT: S$108; Lee Metal Group: S$12)
Bought 2 lots of Sakari @1.41 & @1.17 respectively.
Portfolio Snapshot:
| No. |
Counter |
Cost
(S$) |
Lots |
Avg Px
(S$) |
% of
Port |
Mkt Px
(S$) |
Mkt Value
(S$) |
P/L
(S$) |
P/L
(%) |
| 1 |
Sakari Resources |
7,987.74 |
5 |
1.598 |
20.00% |
1.365 |
6,825.00 |
(1,162.74) |
-14.56% |
| 2 |
SMRT
|
5,669.62 |
3 |
1.890 |
14.19% |
1.690 |
5,070.00 |
(599.62) |
-10.58% |
| 3 |
AIMS AMP Ind REIT |
4,186.95 |
4 |
1.047 |
10.48% |
1.200 |
4,800.00 |
613.05 |
14.64% |
| 4 |
Sabana REIT |
3,745.36 |
4 |
0.936 |
9.38% |
0.975 |
3,900.00 |
154.64 |
4.13% |
| 5 |
StarHub |
2,858.20 |
1 |
2.858 |
7.16% |
3.420 |
3,420.00 |
561.80 |
19.66% |
| 6 |
InnoTek |
2,574.78 |
6 |
0.429 |
6.45% |
0.390 |
2,340.00 |
(234.78) |
-9.12% |
| 7 |
First REIT |
2,497.25 |
4 |
0.624 |
6.25% |
0.915 |
3,660.00 |
1,162.75 |
46.56% |
| 8 |
GRP
|
2,364.68 |
12 |
0.197 |
5.92% |
0.215 |
2,580.00 |
215.32 |
9.11% |
| 9 |
Kingsmen Creative |
1,679.22 |
3 |
0.560 |
4.20% |
0.680 |
2,040.00 |
360.78 |
21.48% |
| 10 |
UMS |
1,467.48 |
3 |
0.489 |
3.67% |
0.405 |
1,215.00 |
(252.48) |
-17.21% |
| 11 |
Lee Metal Group |
1,317.41 |
6 |
0.220 |
3.30% |
0.215 |
1,290.00 |
(27.41) |
-2.08% |
| 12 |
Tai Sin Electric |
1,167.33 |
6 |
0.195 |
2.92% |
0.200 |
1,200.00 |
32.67 |
2.80% |
| 13 |
Memtech |
1,062.00 |
12 |
0.089 |
2.66% |
0.075 |
900.00 |
(162.00) |
-15.25% |
| 14 |
Cambridge Ind REIT |
825.93 |
2 |
0.413 |
2.07% |
0.570 |
1,140.00 |
314.07 |
38.03% |
| 15 |
Mapletree Log Trust |
542.18 |
1.08 |
0.502 |
1.36% |
0.980 |
1,058.40 |
516.22 |
95.21% |
| |
39,946.13 |
|
|
|
|
41,438.40 |
1,492.27 |
3.74% |
In The Edge Financial Daily Today 2012
Written by Goola Warden of The Edge Singapore
Thursday, 14 June 2012
Key article highlights:
- It is possible for investors to identify the "accounting games" companies play by reconciling their revenues and earnings with their cash flow statement and balance sheet.
- Reported revenue and earnings albeit easily manipulated, impacts figures on balance sheets.
- Legitimate sales and real earnings booked results in increased cash on the balance sheet; unreal revenues and earnings however, inflates the accounts receivable figure.
- An annual 10% revenue growth accompanied with 20% to 30% accounts receivable growth poses a big problem because the company will never get the cash.
- This manipulation technique is likely to be used by companies whose business have a significant time lag between signing contracts and actual delivery of the product or service.
- Companies with an unexpected surge in sales towards the end of a financial year should be looked out for.
- 'Bill and hold' sales allowed Sunbeam to meet revenue and earnings expectations but was essentially fraudulent as their inventory of barbeque grills stockpiled.
- Investors should read every line of a company's financial statements, check all the footnotes and try to understand the company's policy for recognising revenues, earnings, depreciation and accruals.
- Artificially lowering reported expenses to achieve revenue boost results in telltale balance sheets.
- America Online's floppy disks to get signups, an advertising expense that should have been in the income statement, ended up as deferred customer acquisition cost on the balance sheet.
- Inventory consistently growing faster than sales could be a sign that the cost of goods sold on the income statement is understated thereby boosting reported earnings.
- Investors ought to have a healthy skepticism of any move by a company to revalue assets on its balance sheet, especially commodity and agricultural companies.
- Bre-X, a mining company, kept increasing the estimates of the size of its supposedly Indonesian gold deposit. Eventually, it met with a share collapse when earlier ore samples from its mine had been found salted with gold dust.
- Ordinarily, cash should be coming from the operation of the business and going to investments for the future and repaying debt, that is, investing cash and financing cash flow.
- Cash flow classification tricks, however, overstates the operating cash flow instead of the investing or financing cash flow (e.g. classifying tax expense as capital expenditure).
- WorldCom's payment for use of third-party satellites expense was classified as an asset under property, plant and equipment on the balance sheet (instead of an expense in the income statement) and cash outflow as a result of investing activities (instead of operating cash outflow in the cash flow statement) resulted in overstated earnings, overstated operating cash flow and an increase in assets.
My view - an investor is essentially risking his money when buying any company's shares. While there is potential capital growth and cash flow from dividends, adequate pre-investment due diligence and post-investment monitoring must be conducted. Periodic review of financial statements can serve as a means to uncover any irregularities on the company's operating state of affairs.
S$854.97 dividends received.
(Memtech: S$48; Sakari: S$72.81; InnoTek: S$300; UMS: S$90; StarHub: S$50; Lee Metal: S$60; Kingsmen: S$75; Sabana: S$90.40; Mapletree Log: S$18.36; First REIT: S$50.40)
Bought 6 lots of Memtech @0.08 and 2 lots of Sakari @1.74 & @1.53 respectively.
Portfolio Snapshot:
| No. |
Counter |
Cost
(S$) |
Lots |
Avg Px
(S$) |
% of
Port |
Mkt Px
(S$) |
Mkt Value
(S$) |
P/L
(S$) |
P/L
(%) |
| 1 |
SMRT
|
5,669.62 |
3 |
1.890 |
15.20% |
1.620 |
4,860.00 |
(809.62) |
-14.28% |
| 2 |
Sakari Resources |
5,352.93 |
3 |
1.784 |
14.35% |
1.450 |
4,350.00 |
(1,002.93) |
-18.74% |
| 3 |
AIMS AMP Ind REIT |
4,186.95 |
4 |
1.047 |
11.22% |
1.140 |
4,560.00 |
373.05 |
8.91% |
| 4 |
Sabana REIT |
3,745.36 |
4 |
0.936 |
10.04% |
0.950 |
3,800.00 |
54.64 |
1.46% |
| 5 |
StarHub |
2,858.20 |
1 |
2.858 |
7.66% |
3.240 |
3,240.00 |
381.80 |
13.36% |
| 6 |
InnoTek |
2,574.78 |
6 |
0.429 |
6.90% |
0.405 |
2,430.00 |
(144.78) |
-5.62% |
| 7 |
First REIT |
2,497.25 |
4 |
0.624 |
6.69% |
0.880 |
3,520.00 |
1,022.75 |
40.96% |
| 8 |
GRP
|
2,364.68 |
12 |
0.197 |
6.34% |
0.215 |
2,580.00 |
215.32 |
9.11% |
| 9 |
Kingsmen Creative |
1,679.22 |
3 |
0.560 |
4.50% |
0.650 |
1,950.00 |
270.78 |
16.13% |
| 10 |
UMS |
1,467.48 |
3 |
0.489 |
3.93% |
0.400 |
1,200.00 |
(267.48) |
-18.23% |
| 11 |
Lee Metal Group |
1,317.41 |
6 |
0.220 |
3.53% |
0.210 |
1,260.00 |
(57.41) |
-4.36% |
| 12 |
Tai Sin Electric |
1,167.33 |
6 |
0.195 |
3.13% |
0.195 |
1,170.00 |
2.67 |
0.23% |
| 13 |
Memtech |
1,062.00 |
12 |
0.089 |
2.85% |
0.080 |
960.00 |
(102.00) |
-9.60% |
| 14 |
Cambridge Ind REIT |
825.93 |
2 |
0.413 |
2.21% |
0.540 |
1,080.00 |
254.07 |
30.76% |
| 15 |
Mapletree Log Trust |
542.18 |
1.08 |
0.502 |
1.45% |
0.975 |
1,053.00 |
510.82 |
94.22% |
| |
37,311.32 |
|
|
|
|
38,013.00 |
701.68 |
1.88% |
