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Aircastle Ltd (NYSE:AYR)
Beneish M-Score
-1.98 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Aircastle Ltd has a M-score of -1.98 signals that the company is a manipulator.

AYR' s Beneish M-Score Range Over the Past 10 Years
Min: -3.83   Max: 2.36
Current: -1.98

-3.83
2.36

During the past 12 years, the highest Beneish M-Score of Aircastle Ltd was 2.36. The lowest was -3.83. And the median was -2.67.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Aircastle Ltd for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 1.8905+0.528 * 0.997+0.404 * 1.1416+0.892 * 0.9145+0.115 * 1.027
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1669+4.679 * -0.0573-0.327 * 1.0067
=-1.98

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Sep16) TTM:Last Year (Sep15) TTM:
Accounts Receivable was $5.3 Mil.
Revenue was 194.652 + 189.988 + 183.665 + 208.267 = $776.6 Mil.
Gross Profit was 192.818 + 187.721 + 182.262 + 205.891 = $768.7 Mil.
Total Current Assets was $715.5 Mil.
Total Assets was $7,182.9 Mil.
Property, Plant and Equipment(Net PPE) was $6,004.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $309.2 Mil.
Selling, General & Admin. Expense(SGA) was $60.4 Mil.
Total Current Liabilities was $144.1 Mil.
Long-Term Debt was $4,547.7 Mil.
Net Income was 27.437 + 20.03 + 36.262 + 50.641 = $134.4 Mil.
Non Operating Income was 56.712 + 64.771 + 77.001 + -137.433 = $61.1 Mil.
Cash Flow from Operations was 132.716 + 113.433 + 121.264 + 117.815 = $485.2 Mil.
Accounts Receivable was $3.0 Mil.
Revenue was 212.074 + 204.565 + 194.296 + 238.257 = $849.2 Mil.
Gross Profit was 209.554 + 200.902 + 191.353 + 236.24 = $838.0 Mil.
Total Current Assets was $236.3 Mil.
Total Assets was $6,488.4 Mil.
Property, Plant and Equipment(Net PPE) was $5,885.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $311.7 Mil.
Selling, General & Admin. Expense(SGA) was $56.6 Mil.
Total Current Liabilities was $214.7 Mil.
Long-Term Debt was $3,995.2 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(5.266 / 776.572) / (3.046 / 849.192)
=0.00678108 / 0.00358694
=1.8905

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(838.049 / 849.192) / (768.692 / 776.572)
=0.98687811 / 0.98985284
=0.997

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (715.513 + 6004.489) / 7182.856) / (1 - (236.345 + 5885.807) / 6488.396)
=0.06443871 / 0.056446
=1.1416

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=776.572 / 849.192
=0.9145

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(311.673 / (311.673 + 5885.807)) / (309.163 / (309.163 + 6004.489))
=0.05029028 / 0.04896738
=1.027

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(60.418 / 776.572) / (56.618 / 849.192)
=0.0778009 / 0.06667279
=1.1669

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((4547.727 + 144.14) / 7182.856) / ((3995.22 + 214.656) / 6488.396)
=0.65320354 / 0.64883154
=1.0067

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(134.37 - 61.051 - 485.228) / 7182.856
=-0.0573

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Aircastle Ltd has a M-score of -1.98 signals that the company is likely to be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Aircastle Ltd Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.42750.3090.41710.950.66731.75161.35990.48661.02172.5674
GMI 111.00691.02820.98391.00380.99940.99780.98951.0053
AQI 1.18414.19760.42060.47280.92062.55161.53290.97080.81731.3643
SGI 5.77952.08421.52870.97940.92491.14681.13451.03211.15521.0007
DEPI 0.60231.11160.64710.99261.02810.93570.95551.02351.04990.9881
SGAI 0.38550.67290.78431.00381.07560.87540.92781.07030.90351.0069
LVGI 1.02341.10221.01410.90350.98181.02911.07720.96371.02291.0117
TATA -0.0385-0.0144-0.047-0.0449-0.0978-0.0524-0.1073-0.07-0.056-0.0705
M-score 1.20-0.89-3.00-2.92-3.36-1.27-2.33-3.26-2.65-1.22

Aircastle Ltd Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 0.91250.68211.02170.45590.77640.71112.56743.20260.92421.8905
GMI 0.98780.9890.98950.99281.00021.00361.00531.00240.99930.997
AQI 0.84640.80080.81731.08721.25211.25821.36431.19251.35911.1416
SGI 1.09881.1141.15521.17941.06521.09951.00070.96680.97460.9145
DEPI 1.141.00481.04990.96941.0331.07040.98810.91580.93911.027
SGAI 0.9980.98390.90350.8740.96320.92021.00691.07131.06361.1669
LVGI 1.01381.04341.02290.98191.04141.02711.01171.00240.98131.0067
TATA -0.0757-0.068-0.056-0.0522-0.0537-0.0624-0.0739-0.073-0.0705-0.0573
M-score -2.88-3.09-2.65-3.01-2.78-2.83-1.24-0.77-2.77-1.98
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