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Ensco PLC (NYSE:ESV)
Beneish M-Score
-4.34 (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 -4.34 suggests that the company is not a manipulator.

ESV' s 10-Year Beneish M-Score Range
Min: -4.71   Max: 0.01
Current: -4.34

-4.71
0.01

During the past 13 years, the highest Beneish M-Score of Ensco PLC was 0.01. The lowest was -4.71. And the median was -2.51.


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 * 0.9267+0.528 * 0.911+0.404 * 0.1633+0.892 * 0.9069+0.115 * 1.1285
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8812+4.679 * -0.2671-0.327 * 1.3258
=-4.34

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

This Year (Jun15) TTM:Last Year (Jun14) TTM:
Accounts Receivable was $695 Mil.
Revenue was 1059 + 1163.9 + 970.4 + 1261.2 = $4,455 Mil.
Gross Profit was 556.4 + 645.6 + 553.5 + 729.8 = $2,485 Mil.
Total Current Assets was $2,641 Mil.
Total Assets was $16,338 Mil.
Property, Plant and Equipment(Net PPE) was $13,170 Mil.
Depreciation, Depletion and Amortization(DDA) was $520 Mil.
Selling, General & Admin. Expense(SGA) was $117 Mil.
Total Current Liabilities was $928 Mil.
Long-Term Debt was $5,911 Mil.
Net Income was 260.3 + 324.7 + -3451.8 + 429.4 = $-2,437 Mil.
Non Operating Income was -7.6 + -22.6 + 0 + -3.5 = $-34 Mil.
Cash Flow from Operations was 423.3 + 467.7 + 472.6 + 596 = $1,960 Mil.
Accounts Receivable was $827 Mil.
Revenue was 1203 + 1187 + 1255.6 + 1266.2 = $4,912 Mil.
Gross Profit was 627 + 582.6 + 639.9 + 647 = $2,497 Mil.
Total Current Assets was $1,776 Mil.
Total Assets was $18,271 Mil.
Property, Plant and Equipment(Net PPE) was $12,881 Mil.
Depreciation, Depletion and Amortization(DDA) was $577 Mil.
Selling, General & Admin. Expense(SGA) was $147 Mil.
Total Current Liabilities was $1,090 Mil.
Long-Term Debt was $4,679 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)
=(694.6 / 4454.5) / (826.5 / 4911.8)
=0.1559322 / 0.16826825
=0.9267

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)
=(645.6 / 4911.8) / (556.4 / 4454.5)
=0.50826581 / 0.55793018
=0.911

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 - (2640.6 + 13169.9) / 16338.1) / (1 - (1775.8 + 12881.2) / 18271.2)
=0.03229262 / 0.19780857
=0.1633

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
=4454.5 / 4911.8
=0.9069

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))
=(577.1 / (577.1 + 12881.2)) / (520.2 / (520.2 + 13169.9))
=0.0428806 / 0.03799826
=1.1285

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)
=(117.4 / 4454.5) / (146.9 / 4911.8)
=0.02635537 / 0.02990757
=0.8812

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)
=((5911.3 + 928.3) / 16338.1) / ((4679.1 + 1090) / 18271.2)
=0.41862885 / 0.31574828
=1.3258

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
=(-2437.4 - -33.7 - 1959.6) / 16338.1
=-0.2671

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 -4.34 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

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.03930.73610.95841.09910.82720.75822.19710.66370.95861.0749
GMI 0.7890.82351.00330.98951.09351.14591.13420.91321.03280.9389
AQI 0.86940.85891.08390.98930.95580.87592.65580.93570.93560.1974
SGI 1.41431.71111.18011.1460.8130.8721.67531.51291.1440.9278
DEPI 0.95910.9791.06461.01191.06331.07691.58970.75690.98240.9751
SGAI 0.68360.81451.13040.7891.46331.54281.09950.62060.86180.9684
LVGI 0.87360.818910.75290.91320.75964.15340.89850.94981.4699
TATA -0.0197-0.043-0.0580.0014-0.0691-0.0372-0.0086-0.0549-0.031-0.3712
M-score -2.24-2.35-2.61-2.14-3.14-2.97-1.06-2.59-2.51-4.72

Ensco PLC Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 0.84360.95340.81670.95860.85340.85811.05941.06161.08880.9267
GMI 0.91460.95490.99241.03281.05121.03270.98710.94860.91130.911
AQI 0.93740.94440.93320.93560.94671.02410.96440.19740.18650.1633
SGI 1.26131.14571.1231.1441.12041.06771.03460.93940.92770.9069
DEPI 0.82590.8930.90320.98240.97960.9310.93470.97511.06861.1285
SGAI 0.70630.84240.84660.86180.88410.92090.91520.95650.90790.8812
LVGI 0.89050.9060.94360.94980.95711.05661.19831.46991.4891.3258
TATA -0.0412-0.0386-0.0416-0.031-0.0358-0.1295-0.1125-0.3712-0.3643-0.2671
M-score -2.59-2.57-2.73-2.51-2.64-3.14-3.00-4.71-4.68-4.34
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