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Aircastle Ltd (NYSE:AYR)
Beneish M-Score
-1.38 (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 -1.38 signals that the company is a manipulator.

AYR' s Beneish M-Score Range Over the Past 10 Years
Min: -3.36   Max: -0.99
Current: -1.38

-3.36
-0.99

During the past 12 years, the highest Beneish M-Score of Aircastle Ltd was -0.99. The lowest was -3.36. And the median was -2.82.


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 * 2.5674+0.528 * 1.0053+0.404 * 1.3643+0.892 * 1.0007+0.115 * 0.9881
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0069+4.679 * -0.1049-0.327 * 1.0117
=-1.38

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Dec15) TTM:Last Year (Dec14) TTM:
Accounts Receivable was $8.6 Mil.
Revenue was 208.267 + 212.074 + 204.565 + 194.296 = $819.2 Mil.
Gross Profit was 205.891 + 209.554 + 200.902 + 191.353 = $807.7 Mil.
Total Current Assets was $327.6 Mil.
Total Assets was $6,570.0 Mil.
Property, Plant and Equipment(Net PPE) was $5,867.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $318.8 Mil.
Selling, General & Admin. Expense(SGA) was $56.2 Mil.
Total Current Liabilities was $198.4 Mil.
Long-Term Debt was $4,041.2 Mil.
Net Income was 50.641 + -13.989 + 41.808 + 43.269 = $121.7 Mil.
Non Operating Income was -168.502 + 76.13 + 195.926 + 180.78 = $284.3 Mil.
Cash Flow from Operations was 117.815 + 158.864 + 116.678 + 132.928 = $526.3 Mil.
Accounts Receivable was $3.3 Mil.
Revenue was 238.257 + 177.596 + 226.146 + 176.603 = $818.6 Mil.
Gross Profit was 236.24 + 176.883 + 223.5 + 174.74 = $811.4 Mil.
Total Current Assets was $336.9 Mil.
Total Assets was $6,175.1 Mil.
Property, Plant and Equipment(Net PPE) was $5,579.7 Mil.
Depreciation, Depletion and Amortization(DDA) was $299.4 Mil.
Selling, General & Admin. Expense(SGA) was $55.8 Mil.
Total Current Liabilities was $194.1 Mil.
Long-Term Debt was $3,744.6 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)
=(8.566 / 819.202) / (3.334 / 818.602)
=0.01045652 / 0.0040728
=2.5674

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)
=(209.554 / 818.602) / (205.891 / 819.202)
=0.99115687 / 0.98595951
=1.0053

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 - (327.607 + 5867.062) / 6569.964) / (1 - (336.874 + 5579.718) / 6175.146)
=0.05712284 / 0.0418701
=1.3643

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
=819.202 / 818.602
=1.0007

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))
=(299.365 / (299.365 + 5579.718)) / (318.783 / (318.783 + 5867.062))
=0.05092036 / 0.05153427
=0.9881

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)
=(56.198 / 819.202) / (55.773 / 818.602)
=0.06860091 / 0.06813201
=1.0069

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)
=((4041.156 + 198.385) / 6569.964) / ((3744.587 + 194.079) / 6175.146)
=0.64529136 / 0.63782557
=1.0117

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
=(121.729 - 284.334 - 526.285) / 6569.964
=-0.1049

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 -1.38 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 own 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

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 0.63260.48661.16170.91250.68211.02170.45590.77640.71112.5674
GMI 0.9990.99780.9950.98780.9890.98950.99281.00021.00361.0053
AQI 1.0410.97080.94650.84640.80080.81731.08721.25211.25821.3643
SGI 1.03951.03211.01611.09881.1141.15521.17941.06521.09951.0007
DEPI 1.0161.02351.17531.141.00481.04990.96941.0331.07040.9881
SGAI 1.06161.07031.09870.9980.98390.90350.8740.96320.92021.0069
LVGI 0.85760.96371.03861.01381.04341.02290.98191.04141.02711.0117
TATA -0.1375-0.0916-0.0904-0.112-0.1045-0.0924-0.0861-0.0869-0.0985-0.1049
M-score -3.37-3.36-2.77-3.05-3.26-2.82-3.17-2.94-3.00-1.38
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