Ahh now its time to dig really deep into this company, especially their financials which is really important because why would you put your money in a certain company if you don’t even know whether are they really earning money for you or not. 💵
DRBHCOM 5 Years CAGR
❎ Revenue : (-2.65 %)
❎ Gross Profit : (-13.7 %)
✅ Net Income : 6.05 %
From the above you already know their financials is shit “just joking” I don’t want to sound harsh but it’s really bad in my opinion. If you compare it to their new biggest shareholder of PROTON, Geely Automobile Holdings Ltd, they are not even on par with them in terms of profitability, you can see below for the 5 years CAGR for Geely and compare yourself. 😳
GEELY 5 Years CAGR
✅ Revenue : 48.81 %
✅ Gross Profit : 52.64 %
✅ Net Income : 72.1 %
But we should not only see their past and predict their future and with Geely’s provisioning will we see better financials for DRBHCOM in the future? If Geely can see the future in PROTON should we also see the same thing? That is up to you to decide but for us we would not want to touch a company that has no clear future, we need to either deep dive the Geely Automobile Holdings Ltd or make sure that Geely is implementing the same model to PROTON moving forward.
Lets look more into the DRBHCOM’s 3 financial sheets. As you can see from the Income statement, their revenue has been decreasing up until 2017, in the year 2018 it turned around this is right after Geely took over for PROTON in the year 2017 June. So we can see that Geely is really moving the company in the right direction but how long can it go? In 2019 which is not yet shown in this report we wont really know how much will the new proton x70 increased their revenue as you guys already know that their top sales the latest quarter will be proton x70. 🚘
Not only Income statement but we will also look at their Balance sheet which his equally important. Balance sheet image as below. In their assets section, things to note are their total cash and total assets. Their total cash is increasing especially from 2016 to 2017 but we can see their assets from 2017 to 2018 has been decreasing this is due to the sale of their 10 non profitable properties as mentioned in part 1 of our analysis. ⚖
As for their Liabilities below in the image, there is nothing much to look at, in the year 2018 went down is also due to the sales of their properties but I can see more and more people taking interest in DRBHCOM is it due to Geely? Probably they just like the magic of Geely 😊
In their cashflow statement we can see that their net cash from operations is fluctuating really high, it’s a roller-coaster ride with their cash from operations, in 2018 there is a spike to around 1.1bil which is really high compared to the revenue which only increased a little, why? It could be because of their net profit margin in 2018 finally turned positive 2.31% shown in the picture below and it could also be because of the sale of the 10 properties in 2018. 💰
But for their net change in cash and their free cash flow is decreasing, probably due to the fact that Geely is still changing the workflow in the company but they are using a lot of cash! They are using more cash than they are getting from operations which worries me as it might mean they will need more cash to turnaround the company to make it truly profitable moving forward in the future. In the below picture you can see they have lowered down their dividend payout and their DY should be going down as well, so instead of using it to reward shareholders, Geely will be going to use more cash to build this company in my opinion.
Now we shall see if the directors of DRBHCOM have the same interest in growing the company are inline with their shareholders. From the below image we can see that they do have stake in the company as indirect interest using Etika Strategi Sdn. Bhd holding 55.92%, thus we know that they still have interest in growing the company and it is aligned with their shareholders.
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