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| Share Name | Share Symbol | Market | Stock Type |
|---|---|---|---|
| JQW | JQW | London | Ordinary Share |
| Price Change | Price Change % | Share Price | Last Trade
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|---|---|---|---|---|
| 0.00 | 0.00% | 2.70 | 01:00:00 |
| Open Price | Low Price | High Price | Close Price | Previous Close |
|---|---|---|---|---|
| 2.70 | 2.70 |
| Top Posts |
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Posted at 07/12/2015 15:11 by someuwin Didn't even last three months...09 September 2015 JQW plc ("JQW" or the "Company") Director Appointment After a formal selection process, the Directors of JQW have appointed Francis Chan Hein Huey to the Board of the Company as Chief Financial Officer, replacing Kooi Wei Boon, who has resigned from the Company. Francis Chan Hein Huey (aged 25) has a BSc (Hons) Accounting Degree from Oxford Brookes University and has over 5 years' experience in the auditing industry, having previously worked at Crowe Horwath Malaysia and One Assurance LLP. Francis is fluent in English, Mandarin and Malay. He has had previous experience working with JQW, having worked on the Company's IPO process in 2013 where he gained some exposure to JQW's management team. Kooi Wei Boon has been helping Francis integrate into his new role to ensure that the transition process runs smoothly. 07 December 2015 JQW plc ("JQW" or the "Company") Director Resignation JQW plc, a domestic Chinese B2B e-commerce operator, announces that the Board today received notice of resignation from Francis Chan Hein Huey, JQW's Chief Financial Officer, who is leaving the Company to pursue other options. The Board would like to thank Mr. Francis for his contribution and wish him well in his future endeavours. The Board is initiating the recruitment process for Francis' replacement. |
Posted at 23/9/2015 17:07 by soul limbo JQW – Interims invite belief in the tooth fairyBy Nigel Somerville, the Deputy Sheriff of AIM | Wednesday 23 September 2015 As George Osborne tweets lyrical about being the first UK minister ever to visit the key staging post at the end of China’s Silk Road, Urumqi, JQW has truly tried to make a silk purse from a sow’s ear. If you believe in the tooth fairy then you should buy the shares with all your might. Indeed, you should go down to the world’s local bank (HSBC) and get a mega-loan and buy the entire company for it is trading on a market capitalisation of £11.1 million (source: ADVFN) and yet has a cash pile of £46 million. Heck: shut down the business (except the Chinese authorities have already done that, for a month) and walk away with £35 million profit? With all that cash swilling around, if the Board of JQW wanted to swell the net assets per share in dramatic fashion all they would have to do is launch a thumping great share buy-back and cancel the resulting treasury stock. They could buy back half the company for buttons (about £6 million) and double the NAV per share at a stroke. So why have they not done so? If we look at cash generation we see that cash is up by £6.5 million during H1. With £4 million of receivables and a further £4 million of deferred tax credits we have current assets of about £54 million. Against that there are liabilities totalling £21 million, of which £17 million are deferred revenues (ie subscriptions or some such, paid but not yet used up) which one presumes will come back off the payables at year end. Hand around for a few more months and that’ll be net current assets of £50 million (plus a bit more profits on top). Yet the company is valued in the market at about £11 million. If we look at profitability, we see that total comprehensive income for H1 of over £8 million, and earnings per share of about 4p. With the shares now trading at 5.75p that suggests a PE of 0.7. I really must reply to that email from the Nigerian bank that wants my bank account details so that it can pay me that massive inheritance. Heck, maybe I could just buy out JQW myself. Last year’s Interims contained details of dividends totalling 5.2p per share (cost: about £10 million – just shy of the current market capitalisation) because the company was awash with cash. So this year, with the company even more awash with cash and generating the stuff like there is no tomorrow (er…..) and earnings nicely up on last year there is no dividend at all. Why? OK, there have been a few problems like the suspension of activity announced the other day due to penalties being imposed by the Chinese authorities for advertising infringements and a few problems with Prohibition of Pyramid Selling regulations. If all of JQW’s customers demanded their money back because they wanted to take their business elsewhere then perhaps that £17 of deferred revenues would become a liability and have to be paid back. But even so, this is all just nonsense. On other small point: the comparator figures for FY14 show dividends paid of RMB 114.4 million. We know from last year’s interims that 0.5p way paid as a full year dividend in respect of 2013 (in July, so it does not appear on the comparator figures for this H1 statement). We know that the 5p special dividend and the 0.2p interim dividend (paid together in Oct 14) cost RMB 97.7 million and RMB 3.9 million respectively. Thus, one might hazard a guess at the 0.5p dividend costing about RMB 9.75 million. Total dividends actually paid during FY14 add up to RMB 111.35 million. So where did the other RMB 3 million go? Why is JQW trading on a PE of 0.7? Why has the dividend been chopped despite improved financials since last year’s interims? Why no share buyback to push NAV per share significantly higher. Why, why, why…. The answer is, of course, that nobody believes the company. Nobody believes the cash is there. Nobody believes the earnings. And the company is doing absolutely nothing to convince us otherwise. That is why after publishing supposedly stonking financials the shares are down by 6%. The way the company is behaving suggests that the cash is not there. So if you believe in the tooth fairy then go on right ahead and fill your boots. But will I be buying? Norfolk and Chance. Target price: 0p and suspension (at least) well before Christmas. |
Posted at 05/9/2015 20:32 by xenawarriorprincess I thought I'd paste the whole of the 4th September 2015 Motley Fool article relating to JQW, simply because the last one they did on JQW ended up being deleted from the Motley Fool website in its entirety.Whilst the article is generally positive (and certainly better that the hatchet job last time, which had to be quickly pulled as the author basically got it all wrong) it is cautious on a number of points. They're right about the rapidly expanding market for B2B commerce, but then go on to say - "this explosive growth is attracting a wave of competitors from both inside and outside the country. As a result, established companies like JQW are on the defensive and need to come up with new ways to retain customers." There are certainly B2B competitors inside China, principally Alibaba and Youboy, but competition from outside - I see no evidence of that. Indeed over the last 10 years Alibaba has seen off all foreign B2B and B2C competition within China. This website target='window'>h clearly indicates that JQW is 3rd in B2B market rankings, close behind No 2 Youboy, with Alibaba way ahead, but the rest of the competitors are trailing way behind, number 4 has less than 30% of the number of JQW's users. Indeed outside the top 20, all competitors have less than 5% of the number of JQW's users, and many tend to be in small niche markets. I also think the author is making too much of the "changing business model". Certainly JQW is rapidly expanding the number of agencies it has and this has the effect of reducing the revenue it receives per customer, but it also increases the speed at which JQW can expand across China and enables that expansion to take place more cheaply. I see this as continuing development in a fast changing market space rather than changing its business model. To also suggest that JQW has gone ex growth is going a bit far. Indeed as the company expects to make similar profits to last year for the 2015 full year presumably they are expecting growth in profits to return in the 2nd half - that was the position at 30th June and presumably as there was no alteration to guidance that is still the case. Innovations due in 2015 such as the e commerce payment button on the website, the commission based payments model, in addition to the rural and urban finance offerings, and the mobile applications already introduced could provide a rapid step chance increase in revenues and profits. That is not to say that China does not at present face significant economic challenges, and these may reflect on JQW. However given JQW's cash pile and the fragmented nature of the market it is likely that it is JQW's smaller competitors which will find themselves under greater pressure than JQW and they could be taken out in moves to consolidate the market from which JQW could end up an ultimate beneficiary. As for the timing of MF and share price buy tips this week after months of bashing, I don't believe their 180 degree U turn at this point in time is mere coincidence. JQW announced around 3 months ago months ago that the OMP's had around 4.8M shares remaining. I reckon around 2.2M have gone over that time leaving about 2.6M left. Obviously very rough figures, but it wouldn't take a genius to realize that with a bit of heavy trading, if no new sellers appear, then that 2.6M could go quite quickly. Decent interims, and a sudden shortage of shares after almost a year of selling, together with a favourable press could make this a one way bet. Call me cynical if you must but I'm sure such a scenario has not escaped MF and share price They know the interims will be decent (JQW has said so), they can work out the selling is likely coming to an end, and they themselves provide the favourable press coverage after 12 months of incessant assault. And surprise, surprise up JQW goes. "JQW (LSE: JQW) is one of those companies you either love or hate. The company provides a B2B e-commerce platform focused on connecting Chinese buyers with Chinese sellers, a market that has exploded in size during the past few years. Indeed, data released last March from iResearch found that China's eCommerce sector expanded by more than 20% in 2014, with B2B sales the largest contributor. What's more, analysts predict that China's $2tn eCommerce market is set to double in size over the next three years. Other figures suggest that Chinese B2B e-commerce and B2B electronic payments will amount to $1.4trn and $140bn respectively, in 2015. However, this explosive growth is attracting a wave of competitors from both inside and outside the country. As a result, established companies like JQW are on the defensive and need to come up with new ways to retain customers. JQW itself is in the middle of a transition. The company is changing its business model, contracting out an increasing amount of business through external agents. Unfortunately, this change is hitting margins. For example, while revenue increased by 12% during the first four months of 2015, JQW's gross margin contracted as of commissions paid to agents ate away at profitability. With margins coming under pressure, JQW's net profit contracted by 10% during the first four months of the year. Still, JQW's management believes that the company's profit for the full year should be "of a similar magnitude to last year." Sudden halt It's disappointing that JQW's growth has come to an abrupt halt this year, but while the company is no longer a growth play, it ticks all the boxes as a value play. According to the figures supplied by the enterprise, at year end 2015 JQW had around RMB 394.7m, roughly £40.8m at the end of December last year. This cash balance was reported after dividend payments totalling RMB 114.4m during the year. This indicates that, at present levels, JQW is trading for less than the value of cash on its balance sheet. At time of writing, the company's market cap. is a tiny £20.2m. Furthermore, based on JQW's full-year 2014 results, the company is trading at a historic P/E of only 1.3. Clearly, judging by JQW's current valuation, the market believes that the company doesn't have a future. But the company is profitable and trading below the value of the cash on its balance sheet. For deep value investors, JQW could be a top pick. Trust issues However, there's one issue that's overhanging JQW. Certain Chinese companies have gained a reputation over the past few decades for falsifying accounts, misleading investors and taking advantage of poor corporate control by government. That said, there's currently no indication or proof that JQW is misleading investors, but you can never be too careful. Even at the best of times, deep value plays like JQW aren't for the faint of heart -- you can often end up losing all of your investment. But for those willing to take the plunge the potential reward can sometimes be enormous." |
Posted at 08/8/2015 10:49 by 43rick Xena - is the Internet Banking initiative you mentioned in your 8264 post different from the CreditEase group development referred to in this extract from the 30th April 2014 Finals?Financial services As a result of credit tightening in China, SME's are facing difficulties in obtaining bank loan financing. In this respect, JQW has been working with CreditEase Group, a financial institution which provides wealth management, credit management, microfinance investment, and microcredit loan origination and services in China, to provide a platform and a direct link to a financial institution that provides SMEs with microloan services. This service commenced in the fourth quarter of 2014. Through a cooperation agreement, CreditEase Group will provide microloan financing services to JQW's members with a lower interest rate provided that they can fulfil certain criteria, such as having being a subscribed member of JQW for a defined period of time. CreditEase Group will receive exposure to those SMEs registered as members of JQW. The benefit of the agreement for JQW is that the Group is able to provide a new additional service to its existing members and can also sell this service to attract new SME members to JQW who might need microloan financing. JQW does not bear the credit risk from this arrangement with CreditEase Group. The Group is also exploring the possibility of using its specialist knowledge of the Chinese SME sector in certain business information and e-commerce services in order to provide more valuable data to financial institutions for credit assessment. This is important to create a better opportunity for the Group to diversify its future source of income by sharing the introduction fee with the financial institutions and JQW will be well positioned to negotiate for improved financing terms for JQW's members. Facilities upgraded In the middle of 2014, server mirroring was successfully completed in the Shenzhen internet data centre. As part of this upgrade, some of the older servers were replaced. The server capacity is now sufficient to accommodate the Group's development for the next few years. |
Posted at 06/8/2015 14:51 by bad robot SCAMRNS Number : 7259Y JQW PLC 03 December 2014 3 December 2014 JQW plc ("JQW" or the "Group") Statement regarding Orderly Market Agreements Further to the announcement released on 15 October 2014, JQW, a domestic Chinese B2B e-commerce operator, received confirmation from Midasi Investment Limited ("Midasi"), one of the Orderly Market Parties, that they sold 301,500 shares in the Company in breach of the Orderly Market Agreement. Under the Orderly Market Agreement dated 9 December 2013, Midasi agreed not to dispose or agree to dispose of the legal and beneficial interest in any Ordinary Shares held by them for a period of 12 months from the date of Admission, being 9 December 2014, (the "Orderly Market Period") without the prior written consent of Cairn (Nominated Adviser) and Argento (Financial Adviser), save in certain limited circumstances, and not to dispose or agree to dispose of the legal and beneficial interest in any Ordinary Shares held by them for a period of six months following the expiry of the Orderly Market Period without the prior written consent of Cairn and Argento, such consent not to be unreasonably withheld or delayed. Midasi agreed to re-acquire the shares that they sold and so far bought back 130,000 JQW shares in the Company through the market. Therefore, JQW, Cairn and Argento believe that Midasi continues to be in breach of its Orderly Market Agreement until such time as it has bought back the remaining 171,500 JQW shares. One Capital Investment Group Limited ("One Capital") entered into an Orderly Market Agreement on 9 December 2013 on similar terms as Midasi, save that it was able to make such disposals of JQW shares as to recoup the costs to it of certain aspects the Admission process, which it had agreed to fund. One Capital has disclosed to the Company that it has sold 1,706,000 Ordinary Shares in the market to recoup the cost to it of the JQW admission process. In addition, One Capital has shown the Company documentation indicating that it had transferred 1,406,666 JQW shares to a trust on 7 July 2014 without informing the Company, Cairn and Argento, and has confirmed that the JQW shares held by the trust are subject to the restrictions of the Orderly Market Agreement. - Ends - |
Posted at 03/7/2015 09:28 by 43rick Dividend policy - imo regular dividend payments are needed to move the JQW share price back up to where it should be -From the finals RNS - 30th April 2015 For financial year 2014, JQW has declared a total dividend of 5.2 pence per share (an interim dividend of 0.2 pence per share as well as a special dividend of 5.0 pence per share), with approximately RMB 101.6 million paid out as dividend to shareholders on 23 October 2014. In light of the significant amount paid at that time, the Board has decided to not propose any final dividend in respect to the financial year 2014. Going forward, the Directors intend to resume the payment of regular dividends, which will take into account the Group's profitability, growth, availability of cash and distributable reserves as well as expected financing requirements to develop and expand the operations. |
Posted at 08/6/2015 19:10 by xenawarriorprincess Rupe,There is no doubt that JQW is at a huge discount to its US listed peers. Its closest 'rival' on Alexa rankings is 58.com, C2C, whose 2014 revenues were $264M compared to roughly $126m for JQW, so a little over double. But JQW's shares are valued at less that half of one percent the value of 58.com. Due to consolidating with rivals 58.com's revenues are estimated to jump to a very impressive $677M in 2015, whilst I've pencilled in $210m for JQW, if it achieves 60%-65% revenue growth this year. But as for the market, I suspect that the market either doesn't know about or doesn't care about JQW. Chinese stocks are regarded by some in London as simply toxic - Shares Magazine for example appears to have a simple policy of buying nothing China related, and IC also tends to steer clear these days, possibly due to getting its fingers burned with several tips last year, one of which was JQW. And that is the mainstream press - others take an even dimmer view. But of course that provides the opportunity. B2B is dominated by Alibaba, as it dominates B2C. 58.com appears to be moving to dominate C2C, after it has either bought out or bought major stakes in its rivals. However, whilst Alibaba does have 65% of B2B web traffic, JQW does have a quite respectable 18% (2014 figures). And the history of web traffic in China shows that the dominant player can be overturned. 10 years ago ebay was dominant in China in terms of B2C and C2C. Now it is nowhere having been overtaken by Alibaba. How so? Simply because ebay charged a % fee for its services and Alibaba didn't. Alibaba went for market share, even at the expense of profits. I'm not suggesting that JQW can out do Alibaba, but simply saying that Alibaba's continued dominance in China is not an absolute given. The secret of JQW's anticipated (at least by me) ultimate success is that whilst B2C and C2C represent 68% of total internet platforms in China, and B2B only 32% of platforms, in value terms B2C and C2C represents only 22% of the value of goods transacted, whereas B2B represents 78% of the value of goods sold. And that is why I believe that JQW hold great potential, which one day will be realised. The company is making progress, not only is it holding its own in terms of Alexa rankings, but it is also expanding across China. China has 34 provinces (if you include Taiwan); at the end of 2013 JQW had an agency presence in just 7, at the end of 2014 it was present in 14. Here is the list, showing the 2013/4 expansion - Anhui 1 to 1 Chongqing 0 to 1 Fujian 18 to 17 Guangdong 3 to 5 Guangxi 3 to 5 Guizhou 1 to 1 Hebei 0 to 2 Hubei 2 to 3 Hunan 0 to 1 Jiangxi 1 to 2 Jilin 0 to 1 Shandong 0 to 2 Sichuan 0 to 1 Zhejiang 1 to 2 At the end of 2013 there were 30 agencies, 44 at the end of 2014, by the end of this year there should be at least 60. Presumably each province could support at least a dozen agencies (that is 1 per 3 million population), so there is room for massive potential expansion by JQW, and that in turn would significantly expand its internet presence in China. So, whilst in some ways is presently a 'niche' business, I think that long term it is in the process of expanding into the mainstream, taking in not only B2B websites, design, promotion, advertising but also financial and banking services across a wide range of industries. The underlying business and the share price have become disconnected, but I don't believe that this situation will continue indefinitely. All IMHO, DYOR etc. Xena |
Posted at 07/6/2015 10:07 by xenawarriorprincess Rupe, yes interesting.Shanghai is up 55% since March on repeated stimulation packages, however in terms of p/e ratios valuations remain lower than they were 10 years ago. JQW have said that they are committed long term to Aim, so hopefully that means they won't jump ship and leave for China. However a dual listing on a US market would be a distinct possibility. This part of the recent (30-4-15) Chairman's statement caught the eye of a few investors - "JQW's reputation has been enhanced in China and internationally with the public profile gained from joining AIM. JQW plans to explore the new opportunities for future development that arise from its status as a public company on a recognised international stock market." However exactly what that means was not explained. The Chairman's statement generally was also bullish - "the Board believes that JQW offers a robust and highly reputable branded platform. With exposure in over 50 industry sectors and considerable scope for future growth, JQW is in a strong position to capitalise on the development of this market" and "Trading in 2015 has started positively and JQW views the future with optimism." Similar comments in 2014 were followed by 60% revenue growth. Meanwhile this week, JQW's US listed peers have been at the deal making game again, as they appear to be almost every week - Alibaba - (5-6-15) - is looking to consolidate its position in Russia as well as boosting its presence in cloud computing (5-6-15) - JD.com - (5-6-15) - has launched its Japanese Mall looking to bring Japanese goods to the Chinese market that is just a few days after Alibaba and YahooJapan did a similar deal. And 58.com is also getting noticed following its deals last month with Anjuke and Ganji which looks like will result in massive growth in revenues over the next couple of years. The revenue growth of 58.com is amazing, from $10M in 2010 to $87M in 2012, $145M 2013, $264m in 2014 to an estimated $677M in 2015. Jumei.com has also done a deal (2-6-15) to acquire a stake in a Korean beauty brand. The present low share price may be hampering JQW in terms of consolidating/mergin However, notwithstanding these difficulties the Alexa figures continue to show JQW holding its own against the US listed peers - these are not direct competitors as Alibaba is B2B, B2C and C2C, JD.com is B2C, 58.com C2C, whereas JQW is B2B, but the common thread is that they all link into the booming China internet market. All are predicting revenue growth rates of between 40% and 120% this year - last year JQW grew revenue at 60%, although its agencies channel, which now dominates revenues, grew at 69%. It is likely to do as well this year, IMHO. The US peers are priced at roughly 10x 2014 annual revenues. Current Alexa ratings are Alibaba.com....China JD.com.........China 58.com.........China Jumei.com......China JQW.com........China Both "daily page views" and "time spent on site" are up 13% for JQW in the last 3 months, which is significantly better than the US listed peers. So, despite its deal making ability being effectively crippled by the low share price, the day to day business appears to be doing very well, and for the time being at least JQW is doing more than just holding its own in the China internet market. As yet however the real golden egg has so far eluded JQW, which is not just to charge fees for services provided on its website (after all 90% of users pay nothing) but to pass the revenue for the goods sold through the website and then to take a small share of that. At present revenues only come from web design, advertising and promotion, all the actual payments take place off site, either through banks or by cash. The JQWmall international initiative in 2014 was the first stab at doing this as payments were to go via that website, this now appears to be on something of a back burner, and it seems to have been side lined in favour of grabbing market share in China and expanding there. However the annual results reported that an e payment system will now be launched in the main Chinese based JQW.com website in H2 2015. Orders will be placed and payment made through the JQW website, but initially no commission will be taken. But when commissions are taken, maybe a number of years hence that is when the true worth of JQW will be shown. Most of the US listed peers rely on small transactions involving consumers. The beauty of JQW is that it is B2B, selling anything from machinery to coal to bulk electronics, and the value of goods sold by JQW customers is almost certainly immense. Each deal on JQW will be of a far greater value than its peers, simply by virtue of it being a B2B sale rather than B2C or C2C. A commission based model would propel JQW way up the league table in terms of revenues. Obviously the figures are unknown, probably JQW itself only has a rough idea of the figures as most deals are presently concluded away from the JQW website. But adding the e commerce function and allowing deals to be concluded outside of the unwieldy China banking system will be the first stage of quantifying the potential. This will no doubt tie in with the micro loan offering via CreditEase, and providing credit information to third parties. In time I could see JQW offering a full range of banking and investment facilities. Whilst the M&A route to expansion may be off the agenda at present, JQW in pure market terms appears to be doing very well in an already booming China internet market, and potentially could eventually become one of the big players in terms of revenues. In time JQW will show its true worth, which is presently only hinted at by company accounts and the independent Alexa figures. The AGM announcement can't be far off, so let's see what that brings. All IMHO, DYOR etc. Xena |
Posted at 04/5/2015 00:45 by mrwhippey dogrunner11 -The translation issue is a fairly recent phenomenon. I don't know what has changed but Google now struggles with JQW.com. Hitherto the translation worked absolutely fine. In terms of the international offering, it is not as simple as translating JQW into English and opening it up worldwide. JQW has a different business model to the likes of Alibaba. All trades on JQW are completed off-platform. There is no 'shopping cart' or shipping options. You cannot pay for goods through JQW.com. JQW does not even receive commission from the sales originated on its site. JQWmall is a new format for JQW in terms of offering online transactions. A work-in-progress whose content at the moment is largely driven by the client. It's a case of 'steady as she goes'. This is what they state in last weeks results: "In July 2014, JQW launched its English language B2B e-commerce platform www.jqwmall.com. The platform was established to enable certain of JQW's premier members and other new members to consider expanding their sales internationally through JQW Mall." "Initially the Group chose to focus on suppliers in industries where there was an international price competitive position and where there were lower barriers for exports. At the end of 2014, JQW Mall successfully engaged with 52 local suppliers with more than 600 products being promoted through the platform. Although the contribution at this stage is still small in relation to the Group's overall financial results, the management believes that the contribution from JQW Mall will grow in the future and the international platform will become a more meaningful revenue stream for the Group. JQW continues to strengthen the quality of this platform as well as attracting more high quality suppliers to it." As others have said, it is one for the future if it takes off. Interestingly JQWmall has an almost non-existent Alexa ranking. Surprising really given that JQW have been accused on here of being world-class manipulators of their rankings :-) |
Posted at 02/5/2015 10:39 by xenawarriorprincess It is interesting that Motley Fool, a supposed reputable site, has been caught out publishing completely false information about JQW.The author was saying that the figure for interest received was negative (when it was in fact positive), and therefore intimated JQW did not have the cash reported in the accounts. Indeed not only did "The Fool" say it did not have the cash (a mere £40M or so - note market capitalisation £23M), but that it had a negative cash balance, it actually owed money, and therefore the accounts showed it had to pay interest on those borrowings. This is what "The Fool" said - "2: Net cash? According to JQW’s 2014 balance sheet, the group has no debt and a strong net cash balance, a situation that also existed at the end of 2013, and at the time of the company’s interim results last year. Normally, I would expect a firm in this position to report interest income from its cash balance, with little or no financing costs. However, JQW’s cash flow statement for 2014 shows interest income of minus RMB 4,576,000 — in other words, JQW paid more interest than it received last year. One possible explanation for this is that JQW’s cash balance varies widely, and at various points in the year, it does use debt facilities, which are subsequently repaid before the next reporting date. Today’s results don’t provide enough information to explain this discrepancy, but in my view this calls into question the quality of JQW’s cash balance" This was altered to "#2: Insiders exiting the business According to the firm, “a number of the overseas and early stage investors” have “realised returns on their original investments” over the last year. Although it’s normal for early-stage investors to take some profits when a business is floated, I tend to be suspicious when they start flogging large volumes of shares into the market after a flotation — there’s a risk that they are taking advantage of less well-informed retail buyers. In this case, you have to wonder why a Chinese business has chosen London’s AIM market, rather than the Chinese or Hong Kong markets for its listing. Unfortunately, one possible reason is that UK investors have zero visibility of JQW’s business, whereas investors in Hong Kong or China would be much closer to the action and able to form an informed impression of progress." And "The Fool" said "N.B. The author's second point was changed on 1/5/15 from net cash to insider selling following a miscalcuation (sic - not only can they not get the figures right their spelling is awry as well) in the analysis of cash flow." Effectively "The Fool" was saying that the accounts showed that JQW was cooking the books - borrowing in between account reporting dates, and then repaying the borrowings just before the year end date in order to show a large cash balance, then borrowing again immediately after the year end date, and the evidence was in the accounts as they showed interest being paid, despite a large cash balance on the year end date. This was an outright allegation of fraud, (despite couched in terms such as "possible explanation" and "calls into question") - as if there was no cash then what has happened to all the profits, the clear implication was all the accounts were false, together with the profits, the cash, and no doubt the company itself. This followed on from point 1 of the article "#1: No dividend Today’s results contained some bad news: JQW will not pay a final dividend for 2014......In my view, JQW’s decision to cancel the final dividend is a warning flag for investors" Point 1 - no dividend, followed by point 2 - no cash and cooked books. The reason there is no dividend is that there is no cash with which to pay it. Then point 3 - "#3: The P/E is too low As a value investor, I love buying cheap stocks — but I wouldn’t buy JQW, despite the firm’s shares now trading on a trailing P/E of just 1.8, based on the firm’s reported 2014 earnings per share. In my view, this is simply too cheap. When the stock market prices a share this low, it’s usually because the market does not believe the earnings are sustainable or genuine. I share this view and rate JQW as a strong sell, even after today’s falls. After all, the catastrophic declines of several other Chinese AIM stocks over the last year should serve as a warning: these companies are not necessarily being run to the same accounting standards as UK firms. Some may be genuine, but it appears that some may not be: why take the risk?" So there is the original article - Point 1 - no dividend, because Point 2 - there is no cash and the books are being cooked, followed by Point 3 - JQW is too cheap, because the market doesn't believe the books either Therefore sell even at this lowly price, whilst you can (and you can then buy this share promoted by us). All very logical - but there was a problem - that the central premise of the article was false - JQW wasn't paying interest on borrowings, they were receiving it, on all that cash the company supposedly didn't have. When this glaring error was pointed out to "The Fool", the article was altered to insert a new point 2, but the "sell" conclusion of the article was not altered. So despite the central foundation of the article, from which all the other parts are produced, being proven wrong, that they indeed have £40M cash, instead of supposedly major borrowings (remember the market cap is only £23M), the "sell" conclusion remains. It is as if "The Fool" has decided to publish a conclusion - "I...rate JQW as a strong sell, even after today’s falls." and despite whatever the evidence actually says, despite the central premise of the article being wrong - the cooked books - they are determined to say sell, whatever the reality may be. In many ways this is similar to what TW has been saying over the last several months - he called JQW an outright fraud, then changed his mind a few weeks ago saying he didn't know whether it was a fraud or not. But no matter "The Fool" can then take up the baton and call JQW a fraud. Of course this then gives ammunition to the derampers on here (and other websites) who can then republish the allegations infinitum, all adding up to a crescendo of fraud and false accounting allegations and innuendo. And "The Fool" amended second point "#2: Insiders exiting the business In this case, you have to wonder why a Chinese business has chosen London’s AIM market, rather than the Chinese or Hong Kong markets for its listing." All have a very familiar ring about it on here, indeed it is almost as if they are all reading off a script, and TW, MF, and the derampers can only sell one central message - fraud, cooked books, false accounting - whatever the reality and figures may actually show. Well, "The Fool" has been caught red handed - the message remains "sell", even though the evidence upon which that recommendation was made has been proven manifestly false. Well done to Loobrush, Loverat and Forwood for exposing this attempted fraud by "The Fool" - and it is noticeable that their posts have been marked down on ADVFN, whilst those supporting the manifestly false allegations by "The Fool" have been voted up. Very happy to be buying at these levels, given the manipulation and downright falsehoods being published against this company by supposedly reputable websites. All IMHO, DYOR etc. Xena |
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