AL Group (HKSE:08360) Beneish M-Score : -4.52 (As of May. 01, 2024)

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What is AL Group 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 -4.52 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for AL Group's Beneish M-Score or its related term are showing as below:

HKSE:08360' s Beneish M-Score Range Over the Past 10 Years
Min: -5.29 Med: -2.91 Max: 0.98
Current: -4.52

During the past 10 years, the highest Beneish M-Score of AL Group was 0.98. The lowest was -5.29. And the median was -2.91.

AL Group Beneish M-Score Historical Data

The historical data trend for AL Group'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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AL Group Beneish M-Score Chart

AL Group Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-4.92

-5.29

-3.91

-1.91

-4.52

AL Group Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Beneish M-Score	Get a 7-Day Free Trial															-1.91	-	-	-	-4.52

Competitive Comparison of AL Group's Beneish M-Score

For the Engineering & Construction subindustry, AL Group'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.

AL Group's Beneish M-Score Distribution in the Construction Industry

For the Construction industry and Industrials sector, AL Group's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where AL Group's Beneish M-Score falls into.

AL Group 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 AL Group 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 * 0.952

0.528 * 0.4571

0.404 * 1.8661

0.892 * 0.4556

0.115 * 0.7464

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.7938

4.679 * -0.316405

0.327 * 0.7829

-4.52

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was HK$16.44 Mil.
Revenue was HK$63.81 Mil.
Gross Profit was HK$15.26 Mil.
Total Current Assets was HK$49.36 Mil.
Total Assets was HK$52.79 Mil.
Property, Plant and Equipment(Net PPE) was HK$0.94 Mil.
Depreciation, Depletion and Amortization(DDA) was HK$2.43 Mil.
Selling, General, & Admin. Expense(SGA) was HK$5.60 Mil.
Total Current Liabilities was HK$26.20 Mil.
Long-Term Debt & Capital Lease Obligation was HK$26.89 Mil.
Net Income was HK$-15.86 Mil.
Gross Profit was HK$0.00 Mil.
Cash Flow from Operations was HK$0.85 Mil.

Total Receivables was HK$37.90 Mil.
Revenue was HK$140.06 Mil.
Gross Profit was HK$15.31 Mil.
Total Current Assets was HK$50.91 Mil.
Total Assets was HK$54.74 Mil.
Property, Plant and Equipment(Net PPE) was HK$2.45 Mil.
Depreciation, Depletion and Amortization(DDA) was HK$2.86 Mil.
Selling, General, & Admin. Expense(SGA) was HK$6.86 Mil.
Total Current Liabilities was HK$58.85 Mil.
Long-Term Debt & Capital Lease Obligation was HK$11.46 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)
	=	(16.436 / 63.812)	/	(37.897 / 140.064)
	=	0.257569	/	0.270569
	=	0.952

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)
	=	(15.312 / 140.064)	/	(15.262 / 63.812)
	=	0.109321	/	0.239171
	=	0.4571

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 - (49.358 + 0.936) / 52.79)	/	(1 - (50.907 + 2.446) / 54.74)
	=	0.047282	/	0.025338
	=	1.8661

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
	=	63.812	/	140.064
	=	0.4556

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))
	=	(2.856 / (2.856 + 2.446))	/	(2.427 / (2.427 + 0.936))
	=	0.538665	/	0.721677
	=	0.7464

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)
	=	(5.603 / 63.812)	/	(6.856 / 140.064)
	=	0.087805	/	0.048949
	=	1.7938

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)
	=	((26.886 + 26.2) / 52.79)	/	((11.46 + 58.854) / 54.74)
	=	1.005607	/	1.284509
	=	0.7829

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
	=	(-15.857 - 0	-	0.846)	/	52.79
	=	-0.316405

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.

AL Group has a M-score of -4.52 suggests that the company is unlikely to be a manipulator.

AL Group Beneish M-Score Related Terms

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AL Group (HKSE:08360) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Construction » AL Group Ltd (HKSE:08360) » Definitions » Beneish M-Score

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Traded in Other Exchanges

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Address

39 Gloucester Road, Suite 807, 8th floor, Harcourt House, Wan Chai, Hong Kong, HKG

Website

http://www.al-grp.com

AL Group Ltd through its subsidiaries is engaged in providing interior design and fit-out solutions in Hong Kong. It also provides overall project management solutions. Its services include pre-lease services, interior design & planning, project management, contracting, and customer service. Geographically, the firm generates a majority of its revenue from Hong Kong.

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