Today i don’t know whether i am posting about a food company or some sort of a sexual awareness company or most appropriately a misleading company. The reason why i say this is the annual report of the company. The annual report can be seen as a latest edition of some magazine. However one thing the company has got absolutely correct is its tag line but in an indirect way which is ITS ALL IN THE SENSES. The annual report has involved a lot of Google images search i should say.
Some of the screenshots of annual reports are –
This post definitely mandates an age limit to read i guess but i was once taught that an annual report is a public document and i would like to add to that majority of the annual reports remain just a document without anyone reading them. It is public document which is not so public. Here is the link you where waiting for as you can download the annual report from here. I guarantee this would take less time to download than those videos (you know which videos i am talking about). This is value investing getting more by spending less (You spent less MB but you got the same fun probably).
Now out of all this i didn’t try to go deep into the annual report but by just a primary glance i understand that the company is in some sort of a food business (still trying to match the connection of food business with the images). What would the reason that the company has created has created such an annual report –
1) It is probably made for hiding the financials of the business or i should say the real financials of the business.
2) The images act as a unnecessary wow factor. When you see any image you are probably influenced by it and you maybe then don’t actually think what data as a shareholder you should get in the annual report.
3) Try this – Scan this annual report once and take up any other annual report and scan it similarly. Then think how well the annual report of Temptation Foods serves its purpose of hiding information.
This is an outright rejection for me for any company. On a primary scanning i get the following factors which are not favarouable for the company in the future and should mandate more disclosure –
1) Huge increase in loans which shows the company with no corresponding comparable increase in anything.
2) A large increase in debtors showing that the money is not coming in from the customers (Anyone can sell more by not accepting money). Even when i compare with the increase in sales it is still significant increase.
5) No disclosures as to where the huge amounts borrowed are to be used.
If we look what has happened to the company since then –
1) The company’s share price has fallen to somewhere around 4 (It has not traded in the recent times i guess). From a high of some 250-300 per share to a price of Rs 4. That’s the price the shareholders paid for that images.
This was not a post recommending something but was on learning from a wound up company.
Thnx for four time. Hope you are not going back to the annual report. Please do tell me if you think i have missed something (which i am pretty sure I have).
I will also update my post on Berkshire Hathaway Annual Meet soon as a summary on the fantastic meet so stay tuned. Hope to have a fantastic experience with you.