Takasago Thermal Engineering Co (TSE:1969) Beneish M-Score : -2.74 (As of May. 14, 2024)

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What is Takasago Thermal Engineering Co 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 -2.74 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Takasago Thermal Engineering Co's Beneish M-Score or its related term are showing as below:

TSE:1969' s Beneish M-Score Range Over the Past 10 Years
Min: -2.94 Med: -2.31 Max: -1.64
Current: -2.74

During the past 13 years, the highest Beneish M-Score of Takasago Thermal Engineering Co was -1.64. The lowest was -2.94. And the median was -2.31.

Takasago Thermal Engineering Co Beneish M-Score Historical Data

The historical data trend for Takasago Thermal Engineering Co'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.

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Takasago Thermal Engineering Co Beneish M-Score Chart

Takasago Thermal Engineering Co Annual Data

Trend

Mar14

Mar15

Mar16

Mar17

Mar18

Mar19

Mar20

Mar21

Mar22

Mar23

Beneish M-Score

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-2.46

-2.13

-2.84

-2.20

-2.74

Takasago Thermal Engineering Co 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															-	-2.74	-	-	-

Competitive Comparison of Takasago Thermal Engineering Co's Beneish M-Score

For the Building Products & Equipment subindustry, Takasago Thermal Engineering Co'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.

Takasago Thermal Engineering Co's Beneish M-Score Distribution in the Construction Industry

For the Construction industry and Industrials sector, Takasago Thermal Engineering Co's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Takasago Thermal Engineering Co's Beneish M-Score falls into.

Takasago Thermal Engineering Co 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 Takasago Thermal Engineering Co 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 * 0.8283

0.528 * 0.9993

0.404 * 0.951

0.892 * 1.1192

0.115 * 0.9042

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0.8955

4.679 * -0.043393

0.327 * 0.9765

-2.74

This Year (Mar23) TTM:

Last Year (Mar22) TTM:

Total Receivables was 円139,010 Mil.
Revenue was 円338,831 Mil.
Gross Profit was 円46,363 Mil.
Total Current Assets was 円238,331 Mil.
Total Assets was 円313,391 Mil.
Property, Plant and Equipment(Net PPE) was 円23,756 Mil.
Depreciation, Depletion and Amortization(DDA) was 円2,481 Mil.
Selling, General, & Admin. Expense(SGA) was 円3,718 Mil.
Total Current Liabilities was 円137,146 Mil.
Long-Term Debt & Capital Lease Obligation was 円25,000 Mil.
Net Income was 円12,227 Mil.
Gross Profit was 円0 Mil.
Cash Flow from Operations was 円25,826 Mil.

Total Receivables was 円149,948 Mil.
Revenue was 円302,746 Mil.
Gross Profit was 円41,396 Mil.
Total Current Assets was 円228,208 Mil.
Total Assets was 円300,736 Mil.
Property, Plant and Equipment(Net PPE) was 円20,760 Mil.
Depreciation, Depletion and Amortization(DDA) was 円1,941 Mil.
Selling, General, & Admin. Expense(SGA) was 円3,710 Mil.
Total Current Liabilities was 円134,342 Mil.
Long-Term Debt & Capital Lease Obligation was 円25,000 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)
	=	(139010 / 338831)	/	(149948 / 302746)
	=	0.410264	/	0.495293
	=	0.8283

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)
	=	(41396 / 302746)	/	(46363 / 338831)
	=	0.136735	/	0.136832
	=	0.9993

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 - (238331 + 23756) / 313391)	/	(1 - (228208 + 20760) / 300736)
	=	0.163706	/	0.172138
	=	0.951

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
	=	338831	/	302746
	=	1.1192

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))
	=	(1941 / (1941 + 20760))	/	(2481 / (2481 + 23756))
	=	0.085503	/	0.094561
	=	0.9042

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)
	=	(3718 / 338831)	/	(3710 / 302746)
	=	0.010973	/	0.012254
	=	0.8955

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)
	=	((25000 + 137146) / 313391)	/	((25000 + 134342) / 300736)
	=	0.517392	/	0.52984
	=	0.9765

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
	=	(12227 - 0	-	25826)	/	313391
	=	-0.043393

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.

Takasago Thermal Engineering Co has a M-score of -2.74 suggests that the company is unlikely to be a manipulator.

Takasago Thermal Engineering Co Beneish M-Score Related Terms

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Takasago Thermal Engineering Co (TSE:1969) Business Description

Industry

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Address

6-27-30, Shinjuku, Shinjuku-ku, Tokyo, JPN, 160-0022

Website

http://www.tte-net.co.jp

Takasago Thermal Engineering is a Japan-based company that designs, constructs, manufactures, and installs heating, ventilation, and air conditioning, or HVAC, systems, clean room and related systems, plumbing and sanitation systems, cogeneration systems, electrical systems, instrumentation systems, equipment diagnosis/failure diagnosis systems, dehumidifying/drying systems, vacuum conveying systems for waste, discharged-heat recovery systems, heating/cooling systems, refrigerating/freezing systems, other types of environmental control systems and thermal engineering systems, and so on. In addition, the company is engaged in coordinating construction work, security, and cleaning, with further focuses on energy supply, power generation, and water treatment.

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