LOTTE Fine Chemical Co (XKRX:004000) Beneish M-Score : -3.08 (As of May. 22, 2024)

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What is LOTTE Fine Chemical 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 -3.08 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for LOTTE Fine Chemical Co's Beneish M-Score or its related term are showing as below:

XKRX:004000' s Beneish M-Score Range Over the Past 10 Years
Min: -3.57 Med: -2.61 Max: -0.62
Current: -3.08

During the past 13 years, the highest Beneish M-Score of LOTTE Fine Chemical Co was -0.62. The lowest was -3.57. And the median was -2.61.

LOTTE Fine Chemical Co Beneish M-Score Historical Data

The historical data trend for LOTTE Fine Chemical 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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LOTTE Fine Chemical Co Beneish M-Score Chart

LOTTE Fine Chemical Co Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.79

-2.00

-1.51

-3.57

-1.16

LOTTE Fine Chemical Co Quarterly Data
	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
Beneish M-Score	Get a 7-Day Free Trial															-2.40	-2.30	-2.28	-1.16	-3.08

Competitive Comparison of LOTTE Fine Chemical Co's Beneish M-Score

For the Chemicals subindustry, LOTTE Fine Chemical 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.

LOTTE Fine Chemical Co's Beneish M-Score Distribution in the Chemicals Industry

For the Chemicals industry and Basic Materials sector, LOTTE Fine Chemical Co's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where LOTTE Fine Chemical Co's Beneish M-Score falls into.

LOTTE Fine Chemical 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 LOTTE Fine Chemical 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

0.528 * 1.2968

0.404 * 2.51

0.892 * 0.7033

0.115 * 0.1372

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.6674

4.679 * -0.017254

0.327 * 0.6678

-3.08

This Year (Mar24) TTM:

Last Year (Mar23) TTM:

Total Receivables was ₩0 Mil.
Revenue was 399444.15 + 411264.998 + 401200.689 + 431178.007 = ₩1,643,088 Mil.
Gross Profit was 41440.791 + 41710.894 + 66321.666 + 100639.691 = ₩250,113 Mil.
Total Current Assets was ₩1,146,231 Mil.
Total Assets was ₩2,844,509 Mil.
Property, Plant and Equipment(Net PPE) was ₩0 Mil.
Depreciation, Depletion and Amortization(DDA) was ₩104,160 Mil.
Selling, General, & Admin. Expense(SGA) was ₩81,577 Mil.
Total Current Liabilities was ₩303,951 Mil.
Long-Term Debt & Capital Lease Obligation was ₩0 Mil.
Net Income was 83424.207 + 9700.888 + -12879.832 + -126.499 = ₩80,119 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = ₩0 Mil.
Cash Flow from Operations was 0 + 45157.44 + 41830.991 + 42208.066 = ₩129,196 Mil.

Total Receivables was ₩604,655 Mil.
Revenue was 524977.421 + 496608.949 + 628543.197 + 686259.159 = ₩2,336,389 Mil.
Gross Profit was 74254.762 + 76144.925 + 151479.549 + 159314.162 = ₩461,193 Mil.
Total Current Assets was ₩1,382,860 Mil.
Total Assets was ₩2,865,612 Mil.
Property, Plant and Equipment(Net PPE) was ₩801,132 Mil.
Depreciation, Depletion and Amortization(DDA) was ₩127,437 Mil.
Selling, General, & Admin. Expense(SGA) was ₩69,568 Mil.
Total Current Liabilities was ₩450,872 Mil.
Long-Term Debt & Capital Lease Obligation was ₩7,639 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)
	=	(0 / 1643087.844)	/	(604655.098 / 2336388.726)
	=	0	/	0.258799
	=	0

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)
	=	(461193.398 / 2336388.726)	/	(250113.042 / 1643087.844)
	=	0.197396	/	0.152221
	=	1.2968

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 - (1146231.004 + 0) / 2844508.574)	/	(1 - (1382859.59 + 801132.254) / 2865612.382)
	=	0.597037	/	0.237862
	=	2.51

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
	=	1643087.844	/	2336388.726
	=	0.7033

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))
	=	(127437.044 / (127437.044 + 801132.254))	/	(104159.986 / (104159.986 + 0))
	=	0.13724	/	1
	=	0.1372

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)
	=	(81577.137 / 1643087.844)	/	(69568.24 / 2336388.726)
	=	0.049649	/	0.029776
	=	1.6674

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)
	=	((0 + 303950.879) / 2844508.574)	/	((7638.603 + 450872.025) / 2865612.382)
	=	0.106855	/	0.160004
	=	0.6678

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
	=	(80118.764 - 0	-	129196.497)	/	2844508.574
	=	-0.017254

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.

LOTTE Fine Chemical Co has a M-score of -3.08 suggests that the company is unlikely to be a manipulator.

LOTTE Fine Chemical Co Beneish M-Score Related Terms

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LOTTE Fine Chemical Co (XKRX:004000) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Chemicals » LOTTE Fine Chemical Co Ltd (XKRX:004000) » Definitions » Beneish M-Score

Traded in Other Exchanges

N/A

Address

Samsung Materials Research Complex, 130, Samsung-ro, Yeongtong-gu, Suwon-si, Gyeonggi-do, KOR, 100-102

Website

http://www.sfc.samsung.co.kr

LOTTE Fine Chemical Co Ltd manufactures and sells a variety of chemicals, and chemical-based products. The firm organizes itself into three segments based on product type. The chlorine/cellulose segment, which generates the majority of revenue, sells cellulose and caustic soda used to make products for the construction, cement, ceramics, paint, detergent, and personal care industries. The electronic materials segment sells toner for color laser printers, liquid crystal display materials, and lithium nickel cobalt manganese oxide, used in rechargeable batteries. The ammonia segment's products are used in the production of fertilizer, textiles, and pharmaceuticals. The majority of sales come from Asia.

LOTTE Fine Chemical Co (XKRX:004000) Headlines

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