Sunday, July 03, 2011
Golf club shafts. Losing money.
China Education Resources CHNUF
This is the same company I was following on this blog for a long time (CEDA).
Q1 2011 Results
Weak balance sheet.
Earned about a penny a share.
Cash flow statement was horrible.
Ok, let's go back to the annual report.
Auditors are Chang Lee. Who? Running through the google list, it's not Chang Lee's Tae Kwon Do of Mesquite, TX. Not the Chang W. Lee of the NYT. Not the Chang Lee from Doctor Who. Not Ron Chang Lee. Oh, here they are, all three of them.
Doubts about the company as a going concern. Well, that about wraps it up.... but let me just take a peek:
Balance sheet is horrifying. Income statement... how do you spell hemorrhage?
Equity statement shows lots of share printing for acquisitions etc.
Operations actually generated cash flow. Why did they make a gigantic advance to related parties???
I think I'll skip China Health Labs & Diagnostics Ltd.
They help commercialize technologies coming from universities and other sources. That's certainly a better business than actually trying to guess which ones will succeed. Sort of like selling restaurant equipment instead of starting a restaurant.
10-Q March 2011. "Unlocking the potential of innovation" (I'd rather it be "Picking the pockets of mousetrap builders")
Holy cow, where are your assets? only 10% of them are remaining... and total current liabilities are bigger than total assets. Tiny sliver of equity.
Wow, revenues have gone way up. 50% gross margins. Actual net income! although not much.
Cash flow is terrible: receivables are climbing.
They have a slight customer concentration: 94% of revenues are from Calmare(R) pain therapy.
I've got to toss in a note about Pandora. I rely on them for what was once called "FM radio" (and later satellite radio). I signed up for the $3 per month premium service to get rid of advertisements. For investing work, I find the "Squirrel Nut Zippers" station is perfect. It's like going back in time to 1911 when children in the US worked in factories and sent text messages on what must have been very primitive mobile phones. Hehe.