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Hi all,
I'd start this topic to discuss the difference between the Group results and Company results in financial reports
For every financial results release, there are always two sets of data: Group results and Company results, and they are different set of figures.
I'm puzzled about what's the difference, and how shld we interpret these 2 sets of data.
I searched on the internet but didn't really find much useful info.
But based on the research reports I obtained from broker houses, it seems the Group data is more meaningful when deriving Profit, P/E, Net Asset etc, as they all refer to this Group results.
Anyone can share some more information with me on this?
I'm not from accounting background and being curious about the two sets data's relations and how to make sense of the Company results figure.
Thanks
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The short answer - use Group numbers only. Ignore company-level.
Group means the results are consolidated, taking into account line items for subsidiaries, associates (share of profit and proportional interest) and investments (such as AFS investments or HFT ones).
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the group normally consists many subsidiaries, the company is the principal subsidiary.
that's my understanding only.
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(20-04-2011, 11:45 AM)Musicwhiz Wrote: The short answer - use Group numbers only. Ignore company-level. this is what I do too but somehow I am wondering if there might be useful information in some line items or more applicable for some industries that the company info might provide...???
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Hi Jacmar,
Not that I am aware of.
I've been using Group figures to analyze for the past 5-6 years, and so far have not encountered any issues.
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I guess it depends. Starhub is a classic example - all of its debts are held by the Company alone so if we use the Group NAV to calculate gearing, we get a pretty outrageous figure !
Disclaimer: Please feel free to correct any error in my post. I am not liable for anything. Do your own research and analysis. I do NOT give buy or sell calls and stock tips. Buy and sell at your risk. I am not a qualified financial adviser so I do not give any advice. The postings reflects my own personal thoughts which may or may not be accurate.
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(20-04-2011, 12:32 PM)Nick Wrote: I guess it depends. Starhub is a classic example - all of its debts are held by the Company alone so if we use the Group NAV to calculate gearing, we get a pretty outrageous figure !
If Company level shows debts but at a Group level there are no such debts, it would mean the debt is inter-company and was eliminated upon consolidation. Unless there is another explanation, I would take that to be the case.
At Group level, all inter-company transactions (be it sales, purchases, debtors, creditors) must be eliminated in full.
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(20-04-2011, 12:43 PM)Musicwhiz Wrote: (20-04-2011, 12:32 PM)Nick Wrote: I guess it depends. Starhub is a classic example - all of its debts are held by the Company alone so if we use the Group NAV to calculate gearing, we get a pretty outrageous figure !
If Company level shows debts but at a Group level there are no such debts, it would mean the debt is inter-company and was eliminated upon consolidation. Unless there is another explanation, I would take that to be the case.
At Group level, all inter-company transactions (be it sales, purchases, debtors, creditors) must be eliminated in full.
The Debts are held by the Company and will naturally be expressed in the Group level. But the Group equity is extremely small due to the merger with SCV in 2004. Hence, if we only look at the Group figures, it may seem that Starhub's Debt to Equity ratio exceeds 4.00x. However, based on the Company figures, we know that it is the Company (and not the Group) which borrowed from the bank hence the debt to equity (company's one) is at a decent level. Of course, this whole mess can be mitigated by looking at debt to ebitda instead.
Disclaimer: Please feel free to correct any error in my post. I am not liable for anything. Do your own research and analysis. I do NOT give buy or sell calls and stock tips. Buy and sell at your risk. I am not a qualified financial adviser so I do not give any advice. The postings reflects my own personal thoughts which may or may not be accurate.
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(20-04-2011, 11:45 AM)Musicwhiz Wrote: The short answer - use Group numbers only. Ignore company-level.
Group means the results are consolidated, taking into account line items for subsidiaries, associates (share of profit and proportional interest) and investments (such as AFS investments or HFT ones).
Thanks for the answer,
Seems I'm going on the right direction, use Grp's data for analysis 
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(20-04-2011, 12:43 PM)Musicwhiz Wrote: If Company level shows debts but at a Group level there are no such debts, it would mean the debt is inter-company and was eliminated upon consolidation. Unless there is another explanation, I would take that to be the case.
At Group level, all inter-company transactions (be it sales, purchases, debtors, creditors) must be eliminated in full.
Correct me if I am wrong.. The main Company debt should be fully consolidated and thus any elimination at Group level is due to debt owned to consolidated subsidaries or associates. Am I right?
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