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GuruFocus has detected 3 Warning Signs with Neptune Technologies & Bioressources Inc $NEPT.
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Neptune Technologies & Bioressources Inc (NAS:NEPT)
Beneish M-Score
2.45 (As of Today)

Warning Sign:

Beneish M-Score 2.45 higher than -2.22, which implies that it might have manipulated its financial results.

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.

Neptune Technologies & Bioressources Inc has a M-score of 2.35 signals that the company is a manipulator.

NEPT' s Beneish M-Score Range Over the Past 10 Years
Min: -6.48   Max: 19.85
Current: 2.45

-6.48
19.85

During the past 13 years, the highest Beneish M-Score of Neptune Technologies & Bioressources Inc was 19.85. The lowest was -6.48. And the median was -2.44.


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 Neptune Technologies & Bioressources 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 * 0.8705+0.528 * -0.8191+0.404 * 11.2757+0.892 * 2.6242+0.115 * 0.7841
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.3969+4.679 * 0.0692-0.327 * 1.2951
=2.35

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

This Year (Nov16) TTM:Last Year (Nov15) TTM:
Accounts Receivable was $10.76 Mil.
Revenue was 9.03751674855 + 8.91675642407 + 8.69602162997 + 7.26969631079 = $33.92 Mil.
Gross Profit was 2.57034390353 + 1.99338359748 + 2.719196601 + 2.22077263173 = $9.50 Mil.
Total Current Assets was $28.94 Mil.
Total Assets was $81.91 Mil.
Property, Plant and Equipment(Net PPE) was $34.22 Mil.
Depreciation, Depletion and Amortization(DDA) was $2.44 Mil.
Selling, General & Admin. Expense(SGA) was $12.20 Mil.
Total Current Liabilities was $14.01 Mil.
Long-Term Debt was $13.26 Mil.
Net Income was 7.95369956826 + -0.916294814587 + -2.95403630745 + 0.445749075886 = $4.53 Mil.
Non Operating Income was 0.0260532976031 + 0.277735036159 + -0.359984550019 + 0.126839167935 = $0.07 Mil.
Cash Flow from Operations was -0.186094982879 + 2.59347591937 + -0.905368868289 + -2.71218380807 = $-1.21 Mil.
Accounts Receivable was $4.71 Mil.
Revenue was 4.15693952858 + 3.33003727086 + 2.22158344284 + 3.21705736459 = $12.93 Mil.
Gross Profit was 1.2433165148 + 0.528637712026 + -0.691524310118 + -4.0467237379 = $-2.97 Mil.
Total Current Assets was $29.24 Mil.
Total Assets was $65.17 Mil.
Property, Plant and Equipment(Net PPE) was $34.61 Mil.
Depreciation, Depletion and Amortization(DDA) was $1.90 Mil.
Selling, General & Admin. Expense(SGA) was $11.71 Mil.
Total Current Liabilities was $8.13 Mil.
Long-Term Debt was $8.62 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)
=(10.7570343904 / 33.9199911134) / (4.70893892612 / 12.9256176069)
=0.31712963 / 0.36431056
=0.8705

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)
=(-2.96629382119 / 12.9256176069) / (9.50369673374 / 33.9199911134)
=-0.22948952 / 0.28017981
=-0.8191

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 - (28.9385142177 + 34.2228673515) / 81.913056424) / (1 - (29.243165901 + 34.6057685067) / 65.1720762106)
=0.22892168 / 0.02030228
=11.2757

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
=33.9199911134 / 12.9256176069
=2.6242

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))
=(1.90359778554 / (1.90359778554 + 34.6057685067)) / (2.43795479996 / (2.43795479996 + 34.2228673515))
=0.05213998 / 0.06650028
=0.7841

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)
=(12.1980459902 / 33.9199911134) / (11.7124528815 / 12.9256176069)
=0.3596123 / 0.90614261
=0.3969

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)
=((13.26112848 + 14.0129522108) / 81.913056424) / ((8.62414338429 + 8.13088334965) / 65.1720762106)
=0.33296378 / 0.25708904
=1.2951

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
=(4.5291175221 - 0.0706429516783 - -1.21017173987) / 81.913056424
=0.0692

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.

Neptune Technologies & Bioressources Inc has a M-score of 2.35 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.

Neptune Technologies & Bioressources Inc Annual Data

May06May07May08Feb10Feb11Feb12Feb13Feb14Feb15Feb16
DSRI 1.20570.59511.19791.38760.49431.18451.28141.2194
GMI 1.64881.14960.21321.0621.32343.0727-0.2431-2.636
AQI 2.02050.93910.79611.2960.27740.82121.03978.6017
SGI 1.38421.16631.41041.13571.33910.68640.68361.3605
DEPI 0.90911.3640.79891.28132.41144.03510.26690.6599
SGAI 1.25640.087512.66361.28251.751.57140.91660.3948
LVGI 0.86511.45160.76760.64730.58591.59360.93721.5342
TATA -0.2887-0.18080.09880.1127-0.23140.0187-0.16160.0052
M-score -2.55-3.44-3.92-1.22-3.68-1.42-3.95-0.89

Neptune Technologies & Bioressources Inc Quarterly Data

Aug14Nov14Feb15May15Aug15Nov15Feb16May16Aug16Nov16
DSRI 1.02730.92871.23690.63170.99290.70781.28850.70810.44490.8705
GMI -1.4722-0.6549-0.2505-0.21510.49250.6999-2.6395-2.3079-1.0482-0.8191
AQI 0.49720.61981.03971.81881.55611.10058.60176.27758.216511.2757
SGI 0.58350.66090.70820.74970.97390.97791.28751.95112.24252.6242
DEPI 1.15250.43280.25840.18570.29760.49640.67790.83350.87340.7841
SGAI 1.72741.50260.94210.65030.39410.43990.39640.33050.3840.3969
LVGI 1.2810.99830.93721.21970.99591.11881.53421.45041.48741.2951
TATA -0.0969-0.0873-0.1811-0.1086-0.0411-0.0906-0.00430.0113-0.05850.0692
M-score -4.99-4.44-4.07-3.97-2.72-3.31-0.94-1.51-0.392.35
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