Virtual Mind Holding Co (HKSE:01520) Beneish M-Score : -4.28 (As of May. 16, 2024)

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What is Virtual Mind Holding Co Beneish M-Score?

The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Good Sign:

Beneish M-Score -4.28 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Virtual Mind Holding Co's Beneish M-Score or its related term are showing as below:

HKSE:01520' s Beneish M-Score Range Over the Past 10 Years
Min: -4.28 Med: -2.29 Max: 7.82
Current: -4.28

During the past 12 years, the highest Beneish M-Score of Virtual Mind Holding Co was 7.82. The lowest was -4.28. And the median was -2.29.

Virtual Mind Holding Co Beneish M-Score Historical Data

The historical data trend for Virtual Mind Holding Co's Beneish M-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Virtual Mind Holding Co Beneish M-Score Chart

Virtual Mind Holding Co Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.94

-3.35

-2.16

-1.91

-4.28

Virtual Mind Holding Co Semi-Annual Data
	Jun14	Dec14	Jun15	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23
Beneish M-Score	Get a 7-Day Free Trial															-2.16	-	-1.91	-	-4.28

Competitive Comparison of Virtual Mind Holding Co's Beneish M-Score

For the Apparel Manufacturing subindustry, Virtual Mind Holding Co's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Virtual Mind Holding Co's Beneish M-Score Distribution in the Manufacturing - Apparel & Accessories Industry

For the Manufacturing - Apparel & Accessories industry and Consumer Cyclical sector, Virtual Mind Holding Co's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Virtual Mind Holding Co's Beneish M-Score falls into.

Virtual Mind Holding Co Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski 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 Virtual Mind Holding Co for today is based on a combination of the following eight different indices:

-4.84

0.92 * DSRI

0.528 * GMI

0.404 * AQI

0.892 * SGI

0.115 * DEPI

-4.84

0.92 * 0.7965

0.528 * 0.9264

0.404 * 1.3522

0.892 * 0.7401

0.115 * 1.3237

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.2153

4.679 * -0.308215

0.327 * 1.1148

-4.28

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was HK$92.39 Mil.
Revenue was HK$66.33 Mil.
Gross Profit was HK$11.23 Mil.
Total Current Assets was HK$162.92 Mil.
Total Assets was HK$214.19 Mil.
Property, Plant and Equipment(Net PPE) was HK$5.93 Mil.
Depreciation, Depletion and Amortization(DDA) was HK$3.52 Mil.
Selling, General, & Admin. Expense(SGA) was HK$70.30 Mil.
Total Current Liabilities was HK$39.05 Mil.
Long-Term Debt & Capital Lease Obligation was HK$26.43 Mil.
Net Income was HK$-93.75 Mil.
Gross Profit was HK$0.00 Mil.
Cash Flow from Operations was HK$-27.73 Mil.

Total Receivables was HK$156.72 Mil.
Revenue was HK$89.62 Mil.
Gross Profit was HK$14.06 Mil.
Total Current Assets was HK$238.05 Mil.
Total Assets was HK$288.37 Mil.
Property, Plant and Equipment(Net PPE) was HK$5.19 Mil.
Depreciation, Depletion and Amortization(DDA) was HK$5.05 Mil.
Selling, General, & Admin. Expense(SGA) was HK$78.16 Mil.
Total Current Liabilities was HK$53.86 Mil.
Long-Term Debt & Capital Lease Obligation was HK$25.22 Mil.

1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Total 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)
	=	(92.385 / 66.328)	/	(156.715 / 89.62)
	=	1.392851	/	1.748661
	=	0.7965

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)
	=	(14.06 / 89.62)	/	(11.233 / 66.328)
	=	0.156885	/	0.169355
	=	0.9264

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 Property, Plant and Equipment to Total Assets.

AQI	=	(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)	/	(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
	=	(1 - (162.923 + 5.931) / 214.185)	/	(1 - (238.051 + 5.185) / 288.373)
	=	0.211644	/	0.156523
	=	1.3522

4. SGI = Sales Growth Index

Ratio of Revenue 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
	=	66.328	/	89.62
	=	0.7401

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization 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))
	=	(5.047 / (5.047 + 5.185))	/	(3.523 / (3.523 + 5.931))
	=	0.493256	/	0.372646
	=	1.3237

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales 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)
	=	(70.296 / 66.328)	/	(78.155 / 89.62)
	=	1.059824	/	0.872071
	=	1.2153

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 in leverage

LVGI	=	((LTD_t + CurrentLiabilities_t) / TotalAssets_t)	/	((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
	=	((26.425 + 39.048) / 214.185)	/	((25.216 + 53.857) / 288.373)
	=	0.305684	/	0.274204
	=	1.1148

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
	=	(-93.749 - 0	-	-27.734)	/	214.185
	=	-0.308215

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Virtual Mind Holding Co has a M-score of -4.28 suggests that the company is unlikely to be a manipulator.

Virtual Mind Holding Co Beneish M-Score Related Terms

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Virtual Mind Holding Co (HKSE:01520) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Manufacturing - Apparel & Accessories » Virtual Mind Holding Co Ltd (HKSE:01520) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

N/A

Address

538 Castle Peak Road, Room 2511-15, 25 Floor, Peninsula Tower, Cheung Sha Wan, Kowloon, Hong Kong, HKG

Website

https://www.vmh.com.hk

Virtual Mind Holding Co Ltd is engaged in designing, manufacturing, and trading apparel; provision of money lending business, namely money lending operation; selling of gaming and animated characters related products, namely IP application and products operation. It offers women's fashion outerwear such as coats and jackets, dresses, activewear, and pants. Majority of the revenue is generated from the Design, manufacture, and trading of the apparel segment. Geographically, it derives the majority of revenue from The PRC and also has a presence in Hong Kong and The USA.

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