Keep writing KC, you wrote good articles.

Haha. I was too into the tenets that i forgot you actually wrote this for Pintaras Jaya. My bad.

Actually i am just seeking your opinion on OE that could help on my other companies analysis. Some have minimal impact, some have significant one.

Yes, you are right. It is better to be approximately right than precisely wrong. Margin of safety could help.

For this quote " (If the business requires additional working capital to maintain its competitive position and unit volume, the increment also should be included in ( c) . However, businesses following the LIFO inventory method usually do not require additional working capital if unit volume does not change.)", i can understand because if it follows LIFO, it would have been reflected in its cost of goods sold.

Yea, i have seen different opinions on websites. Some equate OE to FCFF and some say it is entirely a different thing. I think the key point here is "if unit volume does not change". But I think that is a hard information to get or if you don't mind to share with me if you know where to find it. IMHO, i think additional working capital is like a additional maintenance capex by itself. The additional working capital occurs when lets just say the inventory cost increases somehow. Because the business will need to reserve some of this earnings for the next earnings cycle. This definitely can't be returned to the shareholders else the business will stop functioning or unit volume would decrease.

I think the same should go to receivables and payable. If lets just say a business need to give looser credits to maintain its competitive position, then i think it should also included as additional WC as well.

But the problem is these information are hard to come by and we can only estimate, i guess. Plus it could just be simply, timing issue. And if it is included in OE, for some we will get a very volatile OE.

To be honest, i am still a little in the dark. Hope by exchanging opinions with you i could get some light. haha

What do you think?

hi kcchongnz, when you calculate company’s “owner earnings”, do you take changes in working capital into account?

Shouldn't be surprise, saw some huge warrants conversions. If the big boys convert their warrants, their holdings would have increased as others have yet to convert

nice...but segmental operating result will be somewhat distorted because SG and Philippines ops are paying for services to Msia HQ. so the only meaningful figures here would be revenue