Keep dropping and still dropping, when is the end point!

I'm reposting the honest bang wall account of RainT dated 18/11/2017.

RainT
Finally sell of Sas and realised the loss 25% :
Among the lesson learnt are :

1. Failed to follow cut off rules set by myself again. Lost of over 20% is already hard to recoup in short term

2. If company profit drop due to operating reason and not one off item for continuous 2 qtr , it is indication that the company prospect is deteriorating. Sas is this in this case, profit drop due to operating not one off item

3. Balance sheet wise,from net cash , now become net debt. Also the inventory and debtors amount are growing by quarter. This indicate something wrong with Sas management , cash is tie up in inventory and debtors.

4. Bad benchmark ratio , PE high due to recent loss , ROE low , and low dividend yield

5. News is not good always . Such as promoting Sas acqusition etc . But acq is bad company and for related parties. For me , related parties is OK, as long it is good company . But in Sas case it is not .

6. Big fund buying is not necessarily a good thing. We small shareholders will not know what is the behind motive EPF is buying even profit dropping. Maybe EPF want to include a education company in their portfolio or etc. Big fund can hold very long and Sas loss in drop share price only small thing to them . Don't follow blindy when big funds and directors buying / selling . Need study the reason behind.

SasbadI prospect, profit , balance sheet , ratio all is on the bad side !

Lesson learnt and move on to better company!

Kevin008, don't be deceived.

That's exactly what @powerinvestor said earlier. SAS is good at making news and announcement, but sustantially a loss making company.

Rather than thinking hard how to run the business well, it is thinking how to get more money from the investors to cover the loss. Particularly from cheap publicity like this.

And bear in mind that July this year SAS paid Law En Tzer RM 9,400,000 this year to purchase 30% share of sanjung unggul sdn bhd. And who is Law En Tzer? A family member of the Managing Director!

Such acquisition resulted in nett loss of SAS. Looks like a very bad businesses decision to me.

So at the end, what do we as investors get? big dividend? High share price? Completely the opposite

Hi RainT, the textbook list for 2017 is not new anymore. These textbooks have been in use since 1st of Jan 2017.

I have the hardcopy with me. This forum doesn't allow us to attach a file, if not I could attach here.

Burning money...

Don't kena trap

Dropped 12.70% in one day, remarkable!

Yusof63, do you work for SAS? Looks like what you have said is not supported by data but driven by pure emotions.

Textbook is a big and vital part for SAS. If it were not so, will SAS be so eager to make announcement for EACH and EVERY successful tender that it gets?

What you say doesn't change the fact that SAS failed to secure the tenders it wished. Of the near to 100 textbook tenders in 2017, how many did SAS managed to secure?

You said time to buy? I say it is highly likely that you work for SAS.

HAVENT YOU HEARD THAT HARD SELL DOESNT WORK??

Sanofi, yes I think so.

I looked at the standard 1 and form 1 new textbook list. These are new textbook starting 2017.

I don't see anything from SAS in year 1. For Form 1, 0 subject also. That means bad news for SAS.

Before listing they have quite many textbooks, but now...no government project for SAS means sales will drop to rock bottom. i think the revenue will bye bye further..

Good point RainT, it's ok if SAS is run by good management and profitable. But the fact is that it is not. From what I observed it is a downward trend, revenue plunged and cost soared, sounds like mismanagement.

July 2017, SAS paid RM9.4 million in cash to Law En Tzer, to acquire the remaining 30% stake in Sanjung Unggul Sdn Bhd. As below:

http://www.theedgemarkets.com/article/sasbadi-buy-remaining-30-stake-publisher-chinese-school-educational-materials-rm94m

From I what I see in the financial report, Sanjung unggul gives a gross profit of RM5,779,000 in financial year ended 31 Aug 2016. But this gross profit dropped to RM5,421,000 in financial year ended 31 Aug 2017.

My question for the management is: "Why make an acquisition decision that is not benefiting the company?" You paid RM9,400,000 to Law En Tzer, who coincidentally happens to be the family member of the managing director, but that decision resulted in a reduced income for the company.

It doesn't make good business sense to me.

RainT, maybe a good place to start your research is by finding out who is Law En Tzer and his relationship with the MD Law King Hui

Quan,

Praying is not sufficient in this case :)

July 2017, SAS paid RM9.4 million in cash to Law En Tzer, to acquire the remaining 30% stake in Sanjung Unggul Sdn Bhd. As below:

http://www.theedgemarkets.com/article/sasbadi-buy-remaining-30-stake-publisher-chinese-school-educational-materials-rm94m

From I what I see in the financial report, Sanjung unggul gives a gross profit of RM5,779,000 in financial year ended 31 Aug 2016. But this gross profit dropped to RM5,421,000 in financial year ended 31 Aug 2017.

My question for the management is: "Why make an acquisition decision that is not benefiting the company?" You paid RM9,400,000 to Law En Tzer, who coincidentally happens to be the family member of the managing director, but that decision resulted in a reduced income for the company.

It doesn't make good business sense to me.

Sanofi, you may check out the Q4 2016 report for internal billing, contributing to 38.59% of the undiscounted revenue.

It's called "inter company elimination" in the report.

Sanofi, you may get a copy of their financial report from SAS official website.

Don't just follow my opinions, read up on the report and interpret the result.

At the end of the day, you are responsible for your own investment :) but for sure we can share views and resources

It's a decision that you need to make Mishelle.

I make my decision based on the financial figures, it's like the medical report of a person after a medical check up. A medical report tells you whether a person is healthy or has cancer. Similarly, a financial report tells us whether a company is healthy or not.

Based on the latest quarter financial report, thereis a big loss before and after tax. Revenue has dropped tremendously but cost has incteased significantly, hence leading to a nett loss.

From the financial report, I cant say that the company is healthy. And there is a very high percentage of internal billing, i.e. the revenue contributed by internal company selling to another internal company. These are essentially not revenue because they are not generated from customers. For example in Q4 2016, the internal billing amounted to more than RM9,772,000, which is about half of the total revenue.

Talking about the digital platform, have you guys heard about Khan Academy?

They provide all courses online for free!

https://www.khanacademy.org

Why would you pay when you can get good quality materials for free?

My children learn from here. Don't see a good reason why SAS online platform sales will soar.

SAS core business is still very much in it's print publishing, namely sasbadi sdn bhd and malaysian book promotion sdn bhd, contributed to the bulk (approx. >70%) of it's revenue.

However, the sales from these 2 subsidiaries dropped more than 11.80% year on year. Cost increased and sales dropped, sounds like mismanagement to me.

I don't think this stock is good to buy or keep.

https://www.google.com/amp/www.astroawani.com/berita-malaysia/guru-besar-guru-berdepan-tindakan-tegas-157613%3famp=1

This is such an inactive stock.

No activity, no comment, no interest.

The ministry of education is being very strict with ikthisas 1/2000.

Student from year 1 to 3 CANNOT buy any buku kerja. Students from year 4 to 6 can only 1 book for BM, ENG, MATHS and SCIENCE.

As one of the largest school book publisher, this is a veth very bad news for SAS.

Really so good?