【Consolidated Statement of Profit or Loss and Other Comprehensive Income】 The Group’s revenue for the period under review was RM116.1 million, a decrease of 9% as compared topreceding year corresponding period of RM127.1 million.
Preceding year corresponding period partially spanned before the World Health Organization declared the Coronavirus (COVID-19) outbreak to be a pandemic on 11 March 2020, which has since caused severe global social and economic disruptions and uncertainties, including markets where the Group operates.
Share of profit of equity-accounted associate for the period under review was RM11.5 million, an increase of 12% as compared to preceding year corresponding period of RM10.3 million. The increase was mainly attributable to impairment of certain investment cost recorded in preceding year of which no longer recurs in the current year.
Profit before tax for the period under review was RM40.6 million, a decrease of 6% as compared to preceding year corresponding period of RM43.1 million.
【Consolidated Statement of Financial Position】 The Group’s total assets as at 31 August 2021 was RM603.0 million, a decrease of RM29.5 million from last financial year ended 30 November 2020 of RM632.5 million. The decrease was mainly attributable to the special dividend in respect of the financial year ended 30 November 2020 paid on 10 March 2021.
The Group’s total liabilities as at 31 August 2021 was RM43.2 million, a decrease of RM3.4 million from last financial year ended 30 November 2020 of RM46.6 million.
The Group’s total equity as at 31 August 2021 was RM559.8 million, a decrease of RM26.2 million from last financial year ended 30 November 2020 of RM586.0 million.
The Group’s net asset per ordinary share as at 31 August 2021 was RM1.22.
【Consolidated Statement of Cash Flows】 The Group’s cash and cash equivalents as at 31 August 2021 was RM238.7 million, an increase of RM47.0 million from last financial year ended 30 November 2020 of RM191.7 million.
The net cash inflow from the operating activities was RM110.3 million, substantially contributed by dividend received from an associate.
The net cash inflow from the investing activities was RM1.2 million.
The net cash outflow used in financing activities was RM64.5 million, mainly dividends paid to shareholders of the Group.
No point invest in this counter, their Glory age already OVER....better buy TOPGLOVE , Soon this counter price will back to Glory age trust us...TOPGLOVE this month will rose to price RM4.50....Come IB together we Push up the price to more higher than RM5.00.
my point of view their management team all are family & relatives how to improve on R&D. 2. Jewellery totally can't sell 3. Homecare products do not sell much only Ginseng coffee. onside factory in Plot 3 is almost empty and plot 42 on fake Jewellery, Water Filter, detergent & Toothpaste.
After its Q3/2022 quarterly report showing YTD Operating Cashflow of only 16m, market sentiment has changed and now becomes fearful, so, I think we may have seen a peak, unless next quarterly report can show substantially higher Operating Cashflow. Zhu Lian's yearly dividend payment cost is around 78m, to maintain its high dividend. If you linearly extrapolate 16m to full year, that is only 22m so, it will have to dip into its Net Cash chest. If you look at its Net Cash recently, it continues to decline as it dips into its Net Cash. So, you have to be confident that Zhu Lian can stop its Net Cash from declining, else, soon, it will have to cut its high dividends as it is not sustainable to keep paying 78m in dividends every year when operating cash inflow is much smaller. I suspect this stock can keep falling before it gets better, unless somebody knows that its underlying business will turn around. It's not fully without risk. Looking at its business, 37% revenues from Food and Beverages, 26% Health Nutritionals, 18% Personal Care, 10% jewelry, 9% others. The Covid pandemic has hurt its business, some temporary, some permanent because of consumer shifts to online purchasing. 70% of its revenue is exported to Thailand. So, hard to get an edge here and most players look at the Operating Cashflow as proof of a turnaround. The comparable number of this year's 16m is last year's >100m Operating Cashflow, so, that's a big big drop from last year. Even net of cash, based on last year's earnings, the business is priced at a P/E of 15 at RM1.91, meaning if this doesn't grow, then, it's rather expensive. I think this is why market doesn't know and price has been sideways range for 18 months. I like to think the next direction is up as Operating Cash of 16m is already so low, but who knows ... if that number keeps staying low, price can fall. Because of the uncertainty, a dividend investor's protection is to keep the total ownership of Zhulian to a small % of its portfolio, so that poor returns will not significantly impact one's dividend's portfolio.
ZHULIAN high dividend yield is not sustainable by the business. Last FYE EPS is only 8.33 sen. The year before 9 sen. Whereas Total Dividend paid is 3+3+3+3+5 special dividend = 17 sen, more than earnings. For now, it has a cash chest but that cash chest is declining as the business doesn't support the dividend payout.
A long term dividend investor's fears is a dividend cut. Right now, at RM1.85, the Dividend yield is very high since 17 sen / 1.85 = 9%. However, if long term dividend is 8 sen, then, the Dividend can get cut by nearly 50%, dropping that down to 4.5%. Why take the risk? Keep your money in EPF and earn 5%-6% safely.
The business model that relies on emotional connections with individuals is at threat. Something seems broken, as economies have reopened, yet, last Q EPS is weak at only 1.49 sen. Extrapolating gives 6 sen EPS for the whole year, that's not good.
Even if one is optimistic that ZHULIAN can earn 9 sen going forward in EPS and assuming we require 6% dividend yield (to be better than EPF), price needs to drop to RM1.50 before I am interested.
ZHULIAN operating cashflow is still negative for Q1/23. If company keeps losing monies, how can it continue to pay its high dividend of 3+3+3+3 + 5 special dividend. Eventually, that special dividend of 5 sen will get cut to zero. Then the table 3 sen quarterly dividend will get cut to zero eventually. Then what?
Basically ZHULIAN's business needs to make Operating Profit again to support its future dividends.
Or put another way, to support 3+3+3+3+5 sen dividend = 17 sen dividend needs 78 million payout. Investing activities may add 8 million. So, Operating Profit needs to get to 70 million in a year. Last Q1, Operating Profit is negative. How to make 70 million Operating Profit a year to support the 17 sen dividend? For sure, that dividend is going to get cut, if the business doesn't turn around.
So economies gloablly have reopened for nearly a year now. Yet, how come ZHULIAN cannot make an Operating Profit yet??? Something is broken ... the question is - is it broken permanently?
This is a multi-level marketing company initially distributing gold-plated jewellery through its channel. However, in 2021, jewellery accounted for about 10% of the total revenue. So when looking at Bursa companies which can be proxies for gold, I left out Zhulian but instead focus on others such as Poh Kong or Tomei. Refer to Are there Bursa proxies for gold? https://www.youtube.com/watch?v=CvdIyx3eAWA
I took the opportunity to exit my entire position in ZHULIAN at 1.9. I didn't make much money on price - the gains barely covers commissions. I made money via dividends. After subtracting all expenses, I made around 4.1% per annum returns from ZHULIAN, which beats FD, but didn't beat EPF. I didn't feel comfortable to continue owning ZHULIAN, relative to so many good investments out there to own when their prices are depressed. Hence, taking the opportunity to sell my small holdings in ZHULIAN to raise cash as my cash is too small as so many good investments when prices were lower this year. Thank-ful, I didn't lose monies in ZHULIAN. The business is better to avoid.
I do not disagree, there are strategies that could be put in place for solid gains regardless of economy or market condition, but such executions are usually carried out by investment experts or advisors. I speak from experience.
It's hard to predict the future until we see this month's inflation results. However, historical data consistently show that stocks tend to outperform bonds in the long term. Therefore, I'm staying in the market and focusing on selecting high-quality stocks. The challenge lies in identifying these stocks.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....