“4Q/FY16’s 761%/148% reported net profit growth was inflated, mostly lifted by a $21.3 million gain from the spin-off of Aidite. This is a non-cash gain, essentially arising from a mark-to-market accounting treatment,” says Seow in a report on Thursday.
SINGAPORE (March 3): CIMB has downgraded its rating on Q&M Dental Group from “hold” to “reduce”, lowering its target price on the stock to 60 cents from 77 cents on growing concerns about the group’s continued earnings disappointments and goodwill impairment.
Although Q&M closed FY16 with earnings of $28.3 million, which was more than double that of $11.4 million a year ago, analyst Jonathan Seow underscores the group’s core net profit as “a big miss” as it formed only 79% of CIMB’s full-year forecasts.
