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GuruFocus has detected 4 Warning Signs with Century Casinos Inc $CNTY.
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Century Casinos Inc (NAS:CNTY)
Beneish M-Score
-2.06 (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.

Century Casinos Inc has a M-score of -2.06 signals that the company is a manipulator.

CNTY' s Beneish M-Score Range Over the Past 10 Years
Min: -3.35   Max: -1.08
Current: -2.06

-3.35
-1.08

During the past 13 years, the highest Beneish M-Score of Century Casinos Inc was -1.08. The lowest was -3.35. And the median was -2.40.


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 Century Casinos Inc 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 * 1.7253+0.528 * 1.0067+0.404 * 1.2708+0.892 * 1.0411+0.115 * 1.0235
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9955+4.679 * -0.0715-0.327 * 1.2119
=-2.06

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

This Year (Dec16) TTM:Last Year (Dec15) TTM:
Accounts Receivable was $4.7 Mil.
Revenue was 36.977 + 34.526 + 35.201 + 32.53 = $139.2 Mil.
Gross Profit was 17.091 + 17.109 + 18.157 + 16.462 = $68.8 Mil.
Total Current Assets was $45.9 Mil.
Total Assets was $217.8 Mil.
Property, Plant and Equipment(Net PPE) was $140.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $8.3 Mil.
Selling, General & Admin. Expense(SGA) was $44.3 Mil.
Total Current Liabilities was $28.6 Mil.
Long-Term Debt was $50.0 Mil.
Net Income was 3.185 + 1.887 + 2.249 + 1.894 = $9.2 Mil.
Non Operating Income was 0.745 + 0.02 + 1.56 + 0.198 = $2.5 Mil.
Cash Flow from Operations was 6.699 + 6.679 + 5.616 + 3.263 = $22.3 Mil.
Accounts Receivable was $2.6 Mil.
Revenue was 31.931 + 33.526 + 37.875 + 30.405 = $133.7 Mil.
Gross Profit was 15.013 + 17.395 + 20.696 + 13.439 = $66.5 Mil.
Total Current Assets was $33.9 Mil.
Total Assets was $186.4 Mil.
Property, Plant and Equipment(Net PPE) was $131.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $8.0 Mil.
Selling, General & Admin. Expense(SGA) was $42.7 Mil.
Total Current Liabilities was $23.1 Mil.
Long-Term Debt was $32.4 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)
=(4.706 / 139.234) / (2.62 / 133.737)
=0.03379922 / 0.01959069
=1.7253

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)
=(66.543 / 133.737) / (68.819 / 139.234)
=0.49756612 / 0.49426864
=1.0067

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 - (45.948 + 140.763) / 217.838) / (1 - (33.881 + 131.582) / 186.424)
=0.14289059 / 0.11243724
=1.2708

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
=139.234 / 133.737
=1.0411

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))
=(7.999 / (7.999 + 131.582)) / (8.349 / (8.349 + 140.763))
=0.05730723 / 0.05599147
=1.0235

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)
=(44.305 / 139.234) / (42.749 / 133.737)
=0.31820532 / 0.31964976
=0.9955

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)
=((50.026 + 28.608) / 217.838) / ((32.397 + 23.129) / 186.424)
=0.36097467 / 0.29784792
=1.2119

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
=(9.215 - 2.523 - 22.257) / 217.838
=-0.0715

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.

Century Casinos Inc has a M-score of -2.06 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.

Century Casinos Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 0.54710.88471.88251.18570.87220.62331.37350.97641.4991.7252
GMI 1.01431.02281.00021.08021.00991.00871.01471.05170.82741.0067
AQI 0.98770.65650.52361.22051.07171.14121.63740.88750.94251.2708
SGI 1.0490.89840.93771.22021.16761.01361.45611.14781.1141.0411
DEPI 0.45130.97521.43021.16880.95771.27370.96250.86170.95971.0235
SGAI 1.0541.01930.96110.95140.90220.98041.05871.02570.98560.9955
LVGI 0.92080.8840.50210.90690.90610.7582.51031.09220.91741.2119
TATA -0.075-0.13810.0305-0.0523-0.0575-0.037-0.0213-0.0447-0.055-0.0715
M-score -3.25-3.42-1.55-2.17-2.64-2.81-2.07-2.65-2.27-2.06

Century Casinos Inc Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 0.84630.97640.87531.81373.79121.49891.88990.82110.92791.7253
GMI 1.07821.05180.97860.88460.83940.82740.82750.91970.97711.0067
AQI 0.94060.88750.89480.90190.93420.94250.98070.98841.81421.2708
SGI 1.27231.14781.04871.07351.12561.1141.11971.04331.00841.0411
DEPI 0.89360.86170.92730.97140.99410.95970.98710.91120.93271.0235
SGAI 1.0611.02571.04560.96510.9750.98570.99381.07321.05070.9955
LVGI 1.44441.09221.11421.07580.98450.91740.86990.86671.13961.2119
TATA -0.0145-0.0447-0.0526-0.036-0.0606-0.055-0.0547-0.0818-0.0789-0.0715
M-score -2.60-2.65-2.90-1.96-0.19-2.27-1.87-3.02-2.65-2.06
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