MaeMode III

Malaysian AE Models (MaeMode) announced its earnings last night.

Here is the updated financial data for MaeMode.



1. Earnings growth is there, no doubt. Back in 2002, it earned 8.259 million. 5 years later it earned some 16.218 million. Earnings grew at an annual compounded rate of 14.45%. Impressive. Fantastic!

2. Margins are terrible. Back in 2002, net earnings margins was around 7.6%. Now? It's only 4.3%.

3. Cash management is terrible. The evidence of debt built up is there to be seen. Back in 2002, MaeMode was in a nett debt of 65 million. 5 years later, it is now in a nett debt position of 150 million. Which meant that the nett debt grew at an annual compounded rate of 18.2%!

Is the debt built up justifiable?

4. Trade receivables. WOW! Warning bells all over. A year ago it was 109 million. Now it's 243 million.

If you put the trade receivables TRACK RECORD into perspective, back in 2002, MaeMode's trade receivables was only 57 million. 5 years later, it's now 243.109 million. Do you know that this means that MaeMode's receivables has compounded at an annual rate of 33.64%?!

So, its earnings grew at an compounded rate of 14.45% since 2002 but its nett debt grew at annual compounded rate of 18.2%. Its trade receivables grew at an annual compounded rate of 33.64%!

How?