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Ensco PLC (NYSE:ESV)
Beneish M-Score
-3.00 (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.

Ensco PLC has a M-score of -3.00 suggests that the company is not a manipulator.

ESV' s 10-Year Beneish M-Score Range
Min: -3.81   Max: 0.01
Current: -3

-3.81
0.01

During the past 13 years, the highest Beneish M-Score of Ensco PLC was 0.01. The lowest was -3.81. And the median was -2.48.


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 Ensco PLC 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 * 1.0594+0.528 * 0.9871+0.404 * 0.9644+0.892 * 1.0346+0.115 * 0.9347
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9152+4.679 * -0.1125-0.327 * 1.1983
=-3.00

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

This Year (Sep14) TTM:Last Year (Sep13) TTM:
Accounts Receivable was $838 Mil.
Revenue was 1261.2 + 1203 + 1187 + 1255.6 = $4,907 Mil.
Gross Profit was 729.8 + 627 + 582.6 + 639.9 = $2,579 Mil.
Total Current Assets was $3,030 Mil.
Total Assets was $19,773 Mil.
Property, Plant and Equipment(Net PPE) was $13,128 Mil.
Depreciation, Depletion and Amortization(DDA) was $568 Mil.
Selling, General & Admin. Expense(SGA) was $139 Mil.
Total Current Liabilities was $1,132 Mil.
Long-Term Debt was $5,904 Mil.
Net Income was 429.4 + -1172.7 + 292.5 + 361.4 = $-89 Mil.
Non Operating Income was -3.5 + 2.1 + 1.9 + 2 = $3 Mil.
Cash Flow from Operations was 596 + 572.7 + 416.6 + 547.9 = $2,133 Mil.
Accounts Receivable was $765 Mil.
Revenue was 1266.2 + 1248.1 + 1149.9 + 1078.7 = $4,743 Mil.
Gross Profit was 647 + 641.3 + 589.1 + 583.7 = $2,461 Mil.
Total Current Assets was $1,517 Mil.
Total Assets was $19,143 Mil.
Property, Plant and Equipment(Net PPE) was $13,997 Mil.
Depreciation, Depletion and Amortization(DDA) was $564 Mil.
Selling, General & Admin. Expense(SGA) was $147 Mil.
Total Current Liabilities was $941 Mil.
Long-Term Debt was $4,744 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)
=(838.3 / 4906.8) / (764.9 / 4742.9)
=0.17084454 / 0.16127264
=1.0594

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)
=(627 / 4742.9) / (729.8 / 4906.8)
=0.51890194 / 0.52565827
=0.9871

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 - (3030.4 + 13127.6) / 19772.5) / (1 - (1517.1 + 13997.4) / 19142.9)
=0.1828044 / 0.18954286
=0.9644

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
=4906.8 / 4742.9
=1.0346

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))
=(564.2 / (564.2 + 13997.4)) / (567.7 / (567.7 + 13127.6))
=0.03874574 / 0.04145218
=0.9347

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)
=(138.8 / 4906.8) / (146.6 / 4742.9)
=0.02828727 / 0.03090936
=0.9152

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)
=((5903.9 + 1131.5) / 19772.5) / ((4743.6 + 940.5) / 19142.9)
=0.35581742 / 0.29692993
=1.1983

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
=(-89.4 - 2.5 - 2133.2) / 19772.5
=-0.1125

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.

Ensco PLC has a M-score of -3.00 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.

Ensco PLC Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.26131.07830.72710.95681.1020.84680.75822.19710.66370.9586
GMI 0.95810.7880.82991.00161.01131.07361.14591.13420.91321.0328
AQI 0.90030.86940.85891.08390.98930.95580.87592.65580.93570.9356
SGI 0.97121.36321.73231.18211.1430.79410.8721.67531.51291.144
DEPI 1.02361.02330.98711.06460.99891.07711.07691.58970.75690.9824
SGAI 1.23090.71960.99791.12850.79111.4981.54281.09950.62060.8618
LVGI 0.96540.87360.818910.75290.91320.75964.15340.89850.9498
TATA -0.047-0.0169-0.0388-0.0530.0052-0.0691-0.0372-0.0086-0.0549-0.031
M-score -2.57-2.24-2.35-2.59-2.12-3.16-2.97-1.06-2.59-2.51

Ensco PLC Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 0.53080.67840.66370.84360.95340.81670.95860.85340.85811.0594
GMI 1.02440.9570.91320.91460.95490.99241.03281.05121.03270.9871
AQI 0.93360.93750.93570.93740.94440.93320.93560.94671.02410.9644
SGI 2.27821.87721.51291.26131.14571.1231.1441.12041.06771.0346
DEPI 0.6430.82650.75690.82590.8930.90320.98240.97960.9310.9347
SGAI 0.56150.58170.62060.70630.84240.84660.86180.88410.92090.9152
LVGI 0.9450.9020.89850.89050.9060.94360.94980.95711.05661.1983
TATA -0.03-0.0409-0.0549-0.0412-0.0386-0.0416-0.031-0.0358-0.1295-0.1125
M-score -1.87-2.15-2.59-2.59-2.57-2.73-2.51-2.64-3.14-3.00
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