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VAALCO Energy, Inc. (NYSE:EGY)
Beneish M-Score
-2.51 (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.

VAALCO Energy, Inc. has a M-score of -2.51 suggests that the company is not a manipulator.

EGY' s 10-Year Beneish M-Score Range
Min: -7.15   Max: 5.37
Current: -2.51

-7.15
5.37

During the past 13 years, the highest Beneish M-Score of VAALCO Energy, Inc. was 5.37. The lowest was -7.15. And the median was -2.42.


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 VAALCO Energy, 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 * 1.9104+0.528 * 1.0166+0.404 * 0.155+0.892 * 0.8668+0.115 * 1.4452
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1021+4.679 * -0.1046-0.327 * 0.8843
=-2.51

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

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $21.7 Mil.
Revenue was 58.282 + 37.74 + 29.118 + 44.137 = $169.3 Mil.
Gross Profit was 47.17 + 14.094 + 17.823 + 29.647 = $108.7 Mil.
Total Current Assets was $167.5 Mil.
Total Assets was $308.2 Mil.
Property, Plant and Equipment(Net PPE) was $138.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $16.9 Mil.
Selling, General & Admin. Expense(SGA) was $11.3 Mil.
Total Current Liabilities was $45.8 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was 26.376 + 2.386 + 7.121 + 7.188 = $43.1 Mil.
Non Operating Income was 0.057 + -0.072 + -0.002 + -0.094 = $-0.1 Mil.
Cash Flow from Operations was 38.596 + 46.35 + -0.576 + -8.969 = $75.4 Mil.
Accounts Receivable was $13.1 Mil.
Revenue was 53.553 + 37.63 + 58.818 + 45.286 = $195.3 Mil.
Gross Profit was 8.832 + 30.99 + 48.797 + 38.907 = $127.5 Mil.
Total Current Assets was $149.1 Mil.
Total Assets was $268.0 Mil.
Property, Plant and Equipment(Net PPE) was $106.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $19.9 Mil.
Selling, General & Admin. Expense(SGA) was $11.8 Mil.
Total Current Liabilities was $45.1 Mil.
Long-Term Debt was $0.0 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)
=(21.714 / 169.277) / (13.113 / 195.287)
=0.12827496 / 0.06714733
=1.9104

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)
=(14.094 / 195.287) / (47.17 / 169.277)
=0.65301838 / 0.64234361
=1.0166

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 - (167.464 + 138.524) / 308.167) / (1 - (149.125 + 106.608) / 267.956)
=0.00707084 / 0.0456157
=0.155

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
=169.277 / 195.287
=0.8668

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))
=(19.913 / (19.913 + 106.608)) / (16.929 / (16.929 + 138.524))
=0.15738889 / 0.10890108
=1.4452

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)
=(11.255 / 169.277) / (11.781 / 195.287)
=0.06648865 / 0.0603266
=1.1021

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)
=((0 + 45.829) / 308.167) / ((0 + 45.063) / 267.956)
=0.14871482 / 0.16817313
=0.8843

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
=(43.071 - -0.111 - 75.401) / 308.167
=-0.1046

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.

VAALCO Energy, Inc. has a M-score of -2.51 suggests that the company will not 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.

VAALCO Energy, Inc. Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 8.74010.76861.25821.37060.44952.57151.29580.33480.66341.9104
GMI 0.83280.9710.9941.12140.84921.10091.03120.92791.29531.0166
AQI 0.73570.87042.56610.86141.01160.91140.14884.77461.02460.155
SGI 1.57021.50321.15761.27171.35570.68011.16631.56490.9280.8668
DEPI 1.66231.21491.37630.4191.19920.8681.25770.83981.29641.4452
SGAI 0.3541.42340.76452.63610.99371.30710.66260.89921.21851.1022
LVGI 0.58690.48191.7730.82691.73370.61430.67410.81451.84340.8843
TATA 0.0018-0.0698-0.1432-0.1302-0.3049-0.1523-0.0317-0.2063-0.3498-0.1045
M-score 5.29-2.52-2.31-2.79-4.39-1.96-2.34-2.01-4.60-2.51

VAALCO Energy, Inc. Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 0.48920.33480.42850.6950.81870.66341.57811.81240.86331.9104
GMI 1.00840.92790.94650.99090.99521.29531.38651.56421.93141.0166
AQI 0.8914.77464.51824.90860.89321.02461.08191.06371.07290.155
SGI 1.40291.56491.38161.1881.15840.9280.92910.7860.78540.8668
DEPI 0.87440.83981.07061.08421.10881.29641.33371.85311.8491.4452
SGAI 0.82310.89910.97551.21071.02771.21881.17661.26081.19271.1021
LVGI 0.5810.81451.86740.94561.01691.84341.29961.70261.71030.8843
TATA -0.12-0.2063-0.2058-0.1635-0.1779-0.3498-0.2614-0.2227-0.3212-0.1046
M-score -3.04-2.01-2.51-1.79-3.38-4.60-3.09-2.82-3.95-2.51
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