Sujibaby Stock-Talk

Prolexus (8966): Q3/2021 ACTUAL versus my FORECAST - 25 July 2021 - Sujibaby

Publish date: Sun, 25 Jul 2021, 06:18 PM

Finally, after the one month delay, the financial quarterly result is out.

Let's see how accurate was my calculated prediction and where it went different.

For those of you who has missed my previous sharing, please do feel free to read this first:


First, let us analyse the revenue breakdown.

The table below shows the actual revenue and profits based on the numbers reported in the quarterly reports (in GREEN) in comparison to my forecast numbers (in BROWN).



The Analysis


Worse than predicted, the latest Q3/2021 showed serious decline in the apparel revenue. A fall to RM 30.8 million from RM 84 million at Q2/2020 reported prior to the pandemic, shows that Prolexus may have lost its main clients.


The loss surpassed my predict profit despite the textile factory's effort to cut down its operation cost as the revenue seems stagnant. The apparel and textile segments both recorded a disappointing poor performance.


An important highlight will be the appreance of unusual number of incoming profit from investment holding to cover the massive financial loss. Investment holdings profit may come from a related external source which are not directly related to the core business of the company. One may only speculate that the revenue may be from selling of shares or assets.


Textile Factory - An asset that becomes a liability without proper management


The textile factory continues to struggle as the external sales failed to boost its profit. The decline in Inter-segmental may provide clue on the absence of fabric mask order accompanied by declining apparel orders.


I cannot help to wonder what the executive directors do all day despite knowing that their factories are at brink of becoming money sucking black holes without orders.


How bad it looks?


Clearly, the QR is worse than my prediction. It could have been much worse without the contribution from investment holding segment. So, would Prolexus management practise similar strategy to cover the loss in the next quarter? I am waiting to analyse the next quarter results. 




The pandemic is not an excuse


Exactly! How I knew it?

The pandemic is not the reason for the poor performance as its counterpart, Magni-Tech reported steady revenue and profit as seen in its quarter results.


Magni-Tech Industries (7087), Quarterly Reports


Please investors! Never wish that you bought their shares instead of being here. No one could have predicted the market but, we all can take calculated risk through business fundamental analysis accompanied by chart's technical know-how.


How the share price will react to this decline and lack of business prospects? Lets watch it together.


Trade Safe!


Disclaimer: The above analysis is intended solely for informational and educational purpose for peers and, should not be used as a basis for making any specific investment, business or commercial decision. Any decisions to place trades in the financial markets, including trading in stock or options or other financial instruments, is a personal decision that should only be made after thorough research, including a personal risk and financial assessment, and the engagement of professional assistance to the extend one believe its necessary.

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