PT Adaro Energy Indonesia Tbk (ISX:ADRO) Beneish M-Score : -2.28 (As of Apr. 30, 2024)

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What is PT Adaro Energy Indonesia Tbk Beneish M-Score?

The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Good Sign:

Beneish M-Score -2.28 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for PT Adaro Energy Indonesia Tbk's Beneish M-Score or its related term are showing as below:

ISX:ADRO' s Beneish M-Score Range Over the Past 10 Years
Min: -2.96 Med: -2.62 Max: -2.1
Current: -2.28

During the past 13 years, the highest Beneish M-Score of PT Adaro Energy Indonesia Tbk was -2.10. The lowest was -2.96. And the median was -2.62.

PT Adaro Energy Indonesia Tbk Beneish M-Score Historical Data

The historical data trend for PT Adaro Energy Indonesia Tbk's Beneish M-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

PT Adaro Energy Indonesia Tbk Beneish M-Score Chart

PT Adaro Energy Indonesia Tbk Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.96

-2.87

-2.10

-2.39

-2.28

PT Adaro Energy Indonesia Tbk Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Beneish M-Score	Get a 7-Day Free Trial															-2.39	-2.17	-2.53	-2.53	-2.28

Competitive Comparison of PT Adaro Energy Indonesia Tbk's Beneish M-Score

For the Thermal Coal subindustry, PT Adaro Energy Indonesia Tbk's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

PT Adaro Energy Indonesia Tbk's Beneish M-Score Distribution in the Other Energy Sources Industry

For the Other Energy Sources industry and Energy sector, PT Adaro Energy Indonesia Tbk's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where PT Adaro Energy Indonesia Tbk's Beneish M-Score falls into.

PT Adaro Energy Indonesia Tbk Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of PT Adaro Energy Indonesia Tbk for today is based on a combination of the following eight different indices:

-4.84

0.92 * DSRI

0.528 * GMI

0.404 * AQI

0.892 * SGI

0.115 * DEPI

-4.84

0.92 * 0.8307

0.528 * 1.4781

0.404 * 1.1831

0.892 * 0.8105

0.115 * 0.9157

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.5835

4.679 * 0.044655

0.327 * 0.7014

-2.28

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was Rp8,761,017 Mil.
Revenue was 23686056.389 + 23317160.419 + 24653372.661 + 27692530.147 = Rp99,349,120 Mil.
Gross Profit was 8471288.484 + 8409004.458 + 10263495.98 + 11494030.925 = Rp38,637,820 Mil.
Total Current Assets was Rp66,320,110 Mil.
Total Assets was Rp161,447,238 Mil.
Property, Plant and Equipment(Net PPE) was Rp42,377,917 Mil.
Depreciation, Depletion and Amortization(DDA) was Rp122,046 Mil.
Selling, General, & Admin. Expense(SGA) was Rp4,089,820 Mil.
Total Current Liabilities was Rp32,916,752 Mil.
Long-Term Debt & Capital Lease Obligation was Rp7,561,406 Mil.
Net Income was 6513858.207 + 5357447.278 + 6247706.656 + 6899033.32 = Rp25,018,045 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = Rp0 Mil.
Cash Flow from Operations was 5456012.777 + 11290676.173 + 7034302.861 + -5972297.951 = Rp17,808,694 Mil.

Total Receivables was Rp13,011,970 Mil.
Revenue was 34439118.623 + 36162834.843 + 34398024.621 + 17572835.595 = Rp122,572,814 Mil.
Gross Profit was 20260301.06 + 20430636.089 + 21131462.781 + 8636499.3 = Rp70,458,899 Mil.
Total Current Assets was Rp83,678,115 Mil.
Total Assets was Rp169,616,604 Mil.
Property, Plant and Equipment(Net PPE) was Rp39,095,514 Mil.
Depreciation, Depletion and Amortization(DDA) was Rp103,081 Mil.
Selling, General, & Admin. Expense(SGA) was Rp3,186,521 Mil.
Total Current Liabilities was Rp38,501,841 Mil.
Long-Term Debt & Capital Lease Obligation was Rp22,132,669 Mil.

1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Total Receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI	=	(Receivables_t / Revenue_t)	/	(Receivables_t-1 / Revenue_t-1)
	=	(8761016.654 / 99349119.616)	/	(13011969.727 / 122572813.682)
	=	0.088184	/	0.106157
	=	0.8307

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI	=	GrossMargin_t-1	/	GrossMargin_t
	=	(GrossProfit_t-1 / Revenue_t-1)	/	(GrossProfit_t / Revenue_t)
	=	(70458899.23 / 122572813.682)	/	(38637819.847 / 99349119.616)
	=	0.574833	/	0.38891
	=	1.4781

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than Property, Plant and Equipment to Total Assets.

AQI	=	(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)	/	(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
	=	(1 - (66320110.009 + 42377916.899) / 161447237.994)	/	(1 - (83678115.173 + 39095513.987) / 169616603.769)
	=	0.326727	/	0.27617
	=	1.1831

4. SGI = Sales Growth Index

Ratio of Revenue in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI	=	Sales_t	/	Sales_t-1
	=	Revenue_t	/	Revenue_t-1
	=	99349119.616	/	122572813.682
	=	0.8105

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI	=	(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1))	/	(Depreciation_t / (Depreciaton_t + PPE_t))
	=	(103081.256 / (103081.256 + 39095513.987))	/	(122046.454 / (122046.454 + 42377916.899))
	=	0.00263	/	0.002872
	=	0.9157

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI	=	(SGA_t / Sales_t)	/	(SGA_t-1 /Sales_t-1)
	=	(4089819.782 / 99349119.616)	/	(3186521.189 / 122572813.682)
	=	0.041166	/	0.025997
	=	1.5835

7. LVGI = Leverage Index

The ratio of total debt to Total Assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase in leverage

LVGI	=	((LTD_t + CurrentLiabilities_t) / TotalAssets_t)	/	((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
	=	((7561405.754 + 32916752.097) / 161447237.994)	/	((22132669.065 + 38501841.315) / 169616603.769)
	=	0.250721	/	0.35748
	=	0.7014

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA	=	(IncomefromContinuingOperations_t	-	CashFlowsfromOperations_t)	/	TotalAssets_t
	=	(NetIncome_t - NonOperatingIncome_t	-	CashFlowsfromOperations_t)	/	TotalAssets_t
	=	(25018045.461 - 0	-	17808693.86)	/	161447237.994
	=	0.044655

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

PT Adaro Energy Indonesia Tbk has a M-score of -2.28 suggests that the company is unlikely to be a manipulator.

PT Adaro Energy Indonesia Tbk Beneish M-Score Related Terms

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PT Adaro Energy Indonesia Tbk (ISX:ADRO) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Energy » Other Energy Sources » PT Adaro Energy Indonesia Tbk (ISX:ADRO) » Definitions » Beneish M-Score

Traded in Other Exchanges

PADEF:USA ADOOY:USA A64:Germany

Address

Jalan H.R. Rasuna Said, Block X-5, Menara Karya Lantai, 23rd Floor, Kav. 1-2, Jakarta, IDN, 12950

Website

https://www.adaro.com

PT Adaro Energy Indonesia Tbk is an Indonesia-based energy group that focuses on integrated coal mining. The company's primary location is in the Tabalong district in South Kalimantan, where its subsidiary PT Adaro Indonesia operates the single-site coal mine in the southern hemisphere. The company produces thermal coal, which is marketed under the brand name Envirocoal. The company's main customers are blue-chip power utilities, and roughly three-quarters of its coal is produced for foreign customers, with the remainder in Indonesia. In addition to the core mining business, the company also engages in barging, ship-loading, dredging, port services, marketing, and power generation. Its segment comprises coal mining and trading, mining services, logistics, and others.