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Athi River Mining..Growth in Earnings but.. -2009-
Rank: Member Joined: 2/12/2008 Posts: 345
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Athi River Mining..Growth in Earnings but.....
Turnover up 19%
PBT up 14%
EPS up 19%
BUT.....
Net Workin capital down 74.41% compared to previous period.
-net cash from operating activities decreased by huge margin,compared to previous period..
-cash from finance activities increased huge on the other hand!
The company seems to be craving more cash than It's business can generate!!
Fact that company is takin up more debt..short term or otherwise ought to be a concern.
Long term debt comprise about 47% total equity....could say Company is 47% 'owned' bond holders than share holders?
Anyway..picking between growth in earnings vs shaky cash status..i choose follow the cash. Some restructurin is bound to come..jobs will be lost.
DISCLAIMER: This is the opinion of one Jammo,CFA,CPA,Opinionated and Loud,based in nairobi. Whilst care has been taken in compiling the data to be as most factual n logical,he doesn't accept any responsibility of accuracy or completeness of info contained herein..neither does he purport to be a genius!
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Rank: Chief Joined: 1/3/2007 Posts: 18,103 Location: Nairobi
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ARM is expanding substantially in 2008-9. Thus the cash would go down as 'equity' is invested in the new plants. As for loans,they are needed since these projects are often funded 20/80 (equity/debt). If cement consumption drops then ARM will have a huge problem servicing the debts. Greedy when others are fearful,Very fearful when others are greedy - to paraphrase WB Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 6/23/2009 Posts: 13,519 Location: nairobi
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VituVingiSana wrote:ARM is expanding substantially in 2008-9. Thus the cash would go down as 'equity' is invested in the new plants. As for loans,they are needed since these projects are often funded 20/80 (equity/debt).
If cement consumption drops then ARM will have a huge problem servicing the debts.
Greedy when others are fearful,Very fearful when others are greedy - to paraphrase WB @vvs 10 years later! the thing has printed KES 5.80. I wish @Jammo was here to review his prediction, he was 100% accurate
HF 90,000 ABP 3.83; KQ 414,100 ABP 7.92; MTN 23,800 ABP 6.45
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Rank: Chief Joined: 1/3/2007 Posts: 18,103 Location: Nairobi
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obiero wrote:VituVingiSana wrote:ARM is expanding substantially in 2008-9. Thus the cash would go down as 'equity' is invested in the new plants. As for loans,they are needed since these projects are often funded 20/80 (equity/debt).
If cement consumption drops then ARM will have a huge problem servicing the debts.
Greedy when others are fearful,Very fearful when others are greedy - to paraphrase WB @vvs 10 years later! the thing has printed KES 5.80. I wish @Jammo was here to review his prediction, he was 100% accurate 2012 was the eye-opener for me after KQ started crashing and burning... Overload of debt. ARM did the same thing. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Member Joined: 3/20/2008 Posts: 503
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VituVingiSana wrote:obiero wrote:VituVingiSana wrote:ARM is expanding substantially in 2008-9. Thus the cash would go down as 'equity' is invested in the new plants. As for loans,they are needed since these projects are often funded 20/80 (equity/debt).
If cement consumption drops then ARM will have a huge problem servicing the debts.
Greedy when others are fearful,Very fearful when others are greedy - to paraphrase WB @vvs 10 years later! the thing has printed KES 5.80. I wish @Jammo was here to review his prediction, he was 100% accurate 2012 was the eye-opener for me after KQ started crashing and burning... Overload of debt. ARM did the same thing. @VVS, in view of the fact that your sentiments about ARM, as quoted above, were also spot on, it would be nice if you opined on where ARM is and where they are going based on their current situation.
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Rank: Elder Joined: 6/23/2009 Posts: 13,519 Location: nairobi
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xxxxx wrote:VituVingiSana wrote:obiero wrote:VituVingiSana wrote:ARM is expanding substantially in 2008-9. Thus the cash would go down as 'equity' is invested in the new plants. As for loans,they are needed since these projects are often funded 20/80 (equity/debt).
If cement consumption drops then ARM will have a huge problem servicing the debts.
Greedy when others are fearful,Very fearful when others are greedy - to paraphrase WB @vvs 10 years later! the thing has printed KES 5.80. I wish @Jammo was here to review his prediction, he was 100% accurate 2012 was the eye-opener for me after KQ started crashing and burning... Overload of debt. ARM did the same thing. @VVS, in view of the fact that your sentiments about ARM, as quoted above, were also spot on, it would be nice if you opined on where ARM is and where they are going based on their current situation. @xxxxx cement consumption has dropped in Kenya?
HF 90,000 ABP 3.83; KQ 414,100 ABP 7.92; MTN 23,800 ABP 6.45
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Rank: Veteran Joined: 1/20/2011 Posts: 1,820 Location: Nakuru
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xxxxx wrote:VituVingiSana wrote:obiero wrote:VituVingiSana wrote:ARM is expanding substantially in 2008-9. Thus the cash would go down as 'equity' is invested in the new plants. As for loans,they are needed since these projects are often funded 20/80 (equity/debt).
If cement consumption drops then ARM will have a huge problem servicing the debts.
Greedy when others are fearful,Very fearful when others are greedy - to paraphrase WB @vvs 10 years later! the thing has printed KES 5.80. I wish @Jammo was here to review his prediction, he was 100% accurate 2012 was the eye-opener for me after KQ started crashing and burning... Overload of debt. ARM did the same thing. @VVS, in view of the fact that your sentiments about ARM, as quoted above, were also spot on, it would be nice if you opined on where ARM is and where they are going based on their current situation. FY 2017 numbers are a good starting point on where ARM stands. Also, the talk of raising more funds(through equity) is something to look out for. If yes(raising capital via equity), then there are high chances of further dilution. TZ coal situation is a major pain. If this is amicably resolved and a solution is found on retiring expensive debt then ARM will return to profitability. Finally, i beg to disagree with @Obiero on cement demand...if cement demand was dwindling then why are more cement companies (e.g., Ndovu, Raiply) setting up? Why is almost every existing cement company increasing capacity? I was one day fortunate to visit Singapore and i can tell you for free that there is no concrete jungle in East Africa...labda Lagos, Jo'burg na Cairo. Nairobi is still mtoto in terms of construction... Dumb money becomes dumb only when it listens to smart money
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Rank: Member Joined: 3/20/2008 Posts: 503
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Fyatu wrote:xxxxx wrote:VituVingiSana wrote:obiero wrote:VituVingiSana wrote:ARM is expanding substantially in 2008-9. Thus the cash would go down as 'equity' is invested in the new plants. As for loans,they are needed since these projects are often funded 20/80 (equity/debt).
If cement cones motion drops then ARM will have a huge problem servicing the debts.
Greedy when others are fearful,Very fearful when others are greedy - to paraphrase WB @vvs 10 years later! the thing has printed KES 5.80. I wish @Jammo was here to review his prediction, he was 100% accurate 2012 was the eye-opener for me after KQ started crashing and burning... Overload of debt. ARM did the same thing. @VVS, in view of the fact that your sentiments about ARM, as quoted above, were also spot on, it would be nice if you opined on where ARM is and where they are going based on their current situation. FY 2017 numbers are a good starting point on where ARM stands. Also, the talk of raising more funds(through equity) is something to look out for. If yes(raising capital via equity), then there are high chances of further dilution. TZ coal situation is a major pain. If this is amicably resolved and a solution is found on retiring expensive debt then ARM will return to profitability. Finally, i beg to disagree with @Obiero on cement demand...if cement demand was dwindling then why are more cement companies (e.g., Ndovu, Raiply) setting up? Why is almost every existing cement company increasing capacity? I was one day fortunate to visit Singapore and i can tell you for free that there is no concrete jungle in East Africa...labda Lagos, Jo'burg na Cairo. Nairobi is still mtoto in terms of construction... I have seen dilution work in favour of shares if interests are aligned. Total OutreMer did preference shares and look how that's worked out for Total shareholders..best return in 2018.....One would expect ARM to have learnt by now that debt is not an option. The challenge is the uncertainty occasioned on the market and shareholders as a result of unending noises about capital raising. Its like management and the board have no idea what the company's capital requirements, both long or short term are. On top of that there's too much opaqueness about them. A sensible investor would most surely RUN until the company gets a handle of things.
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Rank: Elder Joined: 6/23/2009 Posts: 13,519 Location: nairobi
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Fyatu wrote:xxxxx wrote:VituVingiSana wrote:obiero wrote:VituVingiSana wrote:ARM is expanding substantially in 2008-9. Thus the cash would go down as 'equity' is invested in the new plants. As for loans,they are needed since these projects are often funded 20/80 (equity/debt).
If cement consumption drops then ARM will have a huge problem servicing the debts.
Greedy when others are fearful,Very fearful when others are greedy - to paraphrase WB @vvs 10 years later! the thing has printed KES 5.80. I wish @Jammo was here to review his prediction, he was 100% accurate 2012 was the eye-opener for me after KQ started crashing and burning... Overload of debt. ARM did the same thing. @VVS, in view of the fact that your sentiments about ARM, as quoted above, were also spot on, it would be nice if you opined on where ARM is and where they are going based on their current situation. FY 2017 numbers are a good starting point on where ARM stands. Also, the talk of raising more funds(through equity) is something to look out for. If yes(raising capital via equity), then there are high chances of further dilution. TZ coal situation is a major pain. If this is amicably resolved and a solution is found on retiring expensive debt then ARM will return to profitability. Finally, i beg to disagree with @Obiero on cement demand...if cement demand was dwindling then why are more cement companies (e.g., Ndovu, Raiply) setting up? Why is almost every existing cement company increasing capacity? I was one day fortunate to visit Singapore and i can tell you for free that there is no concrete jungle in East Africa...labda Lagos, Jo'burg na Cairo. Nairobi is still mtoto in terms of construction... @fyatu I stated that cement demand was dropping or asked a sarcastic question ?
HF 90,000 ABP 3.83; KQ 414,100 ABP 7.92; MTN 23,800 ABP 6.45
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Rank: Chief Joined: 1/3/2007 Posts: 18,103 Location: Nairobi
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xxxxx wrote:VituVingiSana wrote:obiero wrote:VituVingiSana wrote:ARM is expanding substantially in 2008-9. Thus the cash would go down as 'equity' is invested in the new plants. As for loans,they are needed since these projects are often funded 20/80 (equity/debt).
If cement consumption drops then ARM will have a huge problem servicing the debts.
Greedy when others are fearful,Very fearful when others are greedy - to paraphrase WB @vvs 10 years later! the thing has printed KES 5.80. I wish @Jammo was here to review his prediction, he was 100% accurate 2012 was the eye-opener for me after KQ started crashing and burning... Overload of debt. ARM did the same thing. @VVS, in view of the fact that your sentiments about ARM, as quoted above, were also spot on, it would be nice if you opined on where ARM is and where they are going based on their current situation. I do not know what's happening at ARM but based on the 1H results + the undercurrents, it doesn't seem good. I am not a shareholder in ARM but I do have some (old) Bamburi. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Rank: Elder Joined: 12/4/2009 Posts: 10,696 Location: NAIROBI
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5.50 smashed Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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Rank: Elder Joined: 12/7/2012 Posts: 11,908
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Rank: Elder Joined: 6/23/2009 Posts: 13,519 Location: nairobi
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Sickening!
HF 90,000 ABP 3.83; KQ 414,100 ABP 7.92; MTN 23,800 ABP 6.45
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Rank: Elder Joined: 6/23/2009 Posts: 13,519 Location: nairobi
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Resumption to the NSE in 10 days time https://www.nation.co.ke...735070-l4p4w0/index.html
HF 90,000 ABP 3.83; KQ 414,100 ABP 7.92; MTN 23,800 ABP 6.45
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Rank: Elder Joined: 12/7/2012 Posts: 11,908
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jammo wrote:Athi River Mining..Growth in Earnings but.....
Turnover up 19%
PBT up 14%
EPS up 19%
BUT.....
Net Workin capital down 74.41% compared to previous period.
-net cash from operating activities decreased by huge margin,compared to previous period..
-cash from finance activities increased huge on the other hand!
The company seems to be craving more cash than It's business can generate!!
Fact that company is takin up more debt..short term or otherwise ought to be a concern.
Long term debt comprise about 47% total equity....could say Company is 47% 'owned' bond holders than share holders?
Anyway..picking between growth in earnings vs shaky cash status..i choose follow the cash. Some restructurin is bound to come..jobs will be lost.
DISCLAIMER: This is the opinion of one Jammo,CFA,CPA,Opinionated and Loud,based in nairobi. Whilst care has been taken in compiling the data to be as most factual n logical,he doesn't accept any responsibility of accuracy or completeness of info contained herein..neither does he purport to be a genius! This guy @jammo on the 1st post of this thread was spot on 8/9 years ago. Wow!!!! In the business world, everyone is paid in two coins - cash and experience. Take the experience first; the cash will come later - H Geneen
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Rank: Elder Joined: 4/22/2010 Posts: 11,522 Location: Nairobi
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Resumption to the NSE in 10 days time https://www.nation.co.ke...35070-l4p4w0/index.html[/quote] Candidate for 2 Bob... possunt quia posse videntur
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Rank: Elder Joined: 6/23/2009 Posts: 13,519 Location: nairobi
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Or worse
HF 90,000 ABP 3.83; KQ 414,100 ABP 7.92; MTN 23,800 ABP 6.45
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Rank: Chief Joined: 1/3/2007 Posts: 18,103 Location: Nairobi
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It's highly unlikely it will resume trading unless there are some significant positive announcements regarding the restructuring in the next few days. Short of a massive Rights Issue or a Strategic Investor, I doubt much will happen. ARM needs to get the banks off its case and more debt may not be the solution. I provided for it soon after the suspension. Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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Athi River Mining..Growth in Earnings but.. -2009-
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