OTC Markets Yields A Treasure Trove Of Data
I went onto the OTC markets to take a look at the BGMO financial statements. I printed them off and gave them to one of my sons (an accountant) and to one of my new neighbours (a CPA) for a review. I expect to get some comments and questions back later tonight or tomorrow. When I do, I will pass them along.
When I invested $ 9k back in 2009, there was some promise of increasing sales and profits from being in the Cleantech – Greentech sector. When I put together the numbers, I am not so sure if the investment makes sense anymore.
The BGMO supplied financials for nine unique time periods from December 2007 through to September 2013 to OTC can be summarized as follows:
Balance Sheet:
Cash and Cash Equivalent:
• There was no real cash and cash equivalent balance prior to January 2009.
• In the later part of 2009 through to December 2010, the cash balances rose to about $ 3 million
• In June 2011, BGMO reported $ 439 million in cash and cash equivalents
• By September 2012, the cash and equivalent balance fell to $ 179 million
Accounts Receivable:
• Accounts receivable from the garment business ran about $ 1 million in each period prior to September 2009
• In September 2009, BGMO reported to the OTC receivables of $ 1000 million
• By June 2010, the receivables fell by 90% to $ 100 million
• Currently, the receivables are reported as being of no concern
Others (inventory and restricted deposits):
• The garment inventory slowly rose from $ 4 million to $ 7 million from late 2007 into 2009 when it was liquidated
• In December 2010, BGMO reported a block deposit of $ 80 million which was reduced to $ 34 million six months later
Payables:
• The accounts payable seem to have shifted from trade payables (in the garment business) to expenses payable to the BGMO management in the financial game
• The amounts payable to HH and SP have been rising and ballooned to $ 80 million in September 2012
• There are two periods with some odd looking payables (cost of sales) in September 2009 and June 2011 but in no other periods
Shareholders’ Equity:
• As for the capital stock, it basically started off as small single digit value through to September 2009
• At that time, the capital stock fell back to $ 1 million but the excess over par blossomed to $ 89 million in 2010 and peaked at $ 239 million in June 2011
• At September 2012, the excess over par became nil
• The retained earnings were slightly positive through to September 2009 when they became nil through June 2011
• In the September 2012 report, the retained earnings became 86 million!
Income Statement:
• Prior to the change in business, the annual sales were $ 14 million and generated a profit just shy of $ 1 million per year
• On the September 2009 statements, BGMO reported to OTC, revenues of $ 1040 million yet a profit of only $ 21 million.
• The next P + L that I could find was in December 2010 where BGMO generated $ 800 million in revenue and a profit of $ 24 million
• In the September 2012 statement, the company reported $ 284 million in sales and a profit of $ 88 million.
• For some reason, I could not locate P + L statements on OTC for June 2010 and June 2011.
Per Share Values:
• The number of outstanding shares reported on the financial statements rose from 29 million at December 2007 to 49 million at January 2009 to 107 million at June 2011.
• At September 2012, BGMO reported over 134 million shares outstanding
• The EPS was nil to just a penny or two from December 2007 through January 2009
• In Sept 2009, December 2010 and Sept 2012, BGMO reported EPS of 34, 23 and 53 cents per share on the financials delivered to OTC
• While not calculated by BGMO, I did calculate the book value per share
• In 2007, the book value was a nickel and through 2009 was slightly north of a dime
• In 2010, the book value rose to pennies over a buck
• The book value per share hit $ 1.78 at June 2011
• At September 2012, the book value collapsed to 44 cents per share
I am not passing any judgment on these company reported financials (not yet at least).
I am waiting for the experts to get back to me on what they see.
