If one were to read line by line KNM's latest quarterly and cumulative 12 month results, one should be able to sense an urgency (finally) to try and address the fears and rumours circulating in the markets on KNM's future.
The company makes more money from overseas than locally, thats fine and dandy. KNM should improve the transparency on foreign earnings by making available as much as possible the details from these foreign operations. A reputable international audit firm should be hired to vet the accounts. If there are additional information that KNM can deliver to shareholders on the details of each and every part of these foreign contributors, that would be wonderful. Key figures would be the EBITDA of RM584m. No goodwill was amortised from the Borsig's acquisition which was RM896m. As long as EBITDA stays above the RM350m-RM400m a year, the Borsig's goodwill figure is still OK. The EBITDA figure is still unaudited but that would be petty at this point in time to say those things. The EBITDA/Goodwill figure is reasonable and that ratio should continue to be improved on over the next 12 months, but considering the very difficult operating environment over the last 6 months of 2008, its a decent performance. The sooner the global recovery and more , the recovery in oil and gas prices, the better the comfort level.
0.5 sen tax exempt and 1 sen non-exempt will support KNM's share price almost immediately. Should allow KNM to establish a new trading range from the current 40 sen to above 50 sen over the near term. Nothing untoward in the corresponding rise in receivables. As long as KNM keeps up this level of clarity and information flow, its on the right track to improving investors relations. Now, please do something on the "details on revenue and cost of foreign subsidiaries".
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