Buying Biz or Buying Stock?
Petronm: It's Time for a Math Class
Wow, I am so surprised that many ppl don't get my logic and my calculations for Petronm's 1Q17 profit. Let me put things in order and hopefully you can see it now.
1) Malaysia operations (listed co + 2 non-listed co in Malaysia owned by Petron Corp) reported Peso 1.5bn net profit in 1Q17, +335% yoy. So, 1Q16 net profit from Malaysia operation = Peso 345m
Workings
a) (1Q17 profit /1Q16 profit) - 1 = yoy growth
B) (1500/345) - 1 = 335% (In case you are still confuse, ask yourself, what's the yoy growth rate if your profit increase from 100 in 1Q16 to 150 in 1Q17? The answer is 50% right? Pls apply the same formula.)
2) Peso 345m net profit in 1Q16 equal to RM30m. This was the profit from Malaysia operation in 1Q16, including 2 non-listed co. So what's the profit belong to non-listed co? Petronm (listed co) reported RM16.6m net profit in 1Q16, so
A) Petronm's 1Q16 profit + 2 non-listed co 1Q16 profit = RM30m
B) RM16.6m + 2 non-listed co 1Q16 profit = RM30m
C) 2 non-listed co 1Q16 profit = RM30m - RM16.6m = RM13.4m
3) Given that 2 non-listed co is involved in fuel marketing and retailing (basically means petrol stations la), the profit growth should be steady due to fixed margin, so it should grow in tandem with sales volume growth. Petron Corp mentioned Malaysia sales volume + 6% yoy in 1Q17, so we can safely assume 2 non-listed co profit grow 10% yoy in 1Q17, from RM13.4m to about RM15m.
4) So how much of RM130m or Peso 1.5bn 1Q17 profit attributes to Petronm?
RM130m - RM15m (2 non-listed co estimated profit) = RM115m (42.6 EPS)
My final advise, if you still don't understand, please don't buy any stocks anymore as stock investment could be way too complicated for you.
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Petronm: A 6x PE stock generating 30% ROE with a clean balance sheet!
Created by sumato88 | May 25, 2017
Discussions
3 people like this. Showing 50 of 50 comments
Thx.. Now understand... One final question, y the fuel marketing n retailing is not listed since petronm is the abrevation name for petron refining and marketing bhd? Need ur advice..
2017-05-13 07:49
Sumota. Why u wanna help these idiots. Don't waste time with idiots, they never understand
2017-05-13 08:36
Thanks bro sumato for resummarizing it! Though the first one is pretty straightforward already! ;)
2017-05-13 09:33
the more i see the workings... the more i see the results infront of my eyes...
instead of the question what...the question when is what bothering me more now
2017-05-13 10:42
逍遥子...you are still the first person who had derived this like Einstein derived relativity...he he...and many people still could not grasp it ..he he
sumato88 just formally presented it in the blog.
2017-05-13 10:54
petron corp own 73.99% of petronm
1Q2016 2 non listed company result should arround 30-16.6*0.7399=17.7mil
This year increase 15% is arround 20mil
petronm 1Q2017 result should be arround (130-20)0.7399 = 148 mil
EPS=54
2017-05-13 11:02
kuokseng79.....i really cannot dispute your findings. This i need accountants consultations...:(
2017-05-13 11:08
Sumato88, final figure RM115m (42.6 EPS) is only account for 73.9% of earning. Need to divide by 0.739 to represent PetronM earning, so the earning for PetronM is 57cents for 1Q17.
2017-05-13 11:16
probability sifu hopefully my cal is no mistake. petronm will rocket to 10. hihihi...
2017-05-13 11:18
1) there are 3 companies that Petron Corp own that operate in Malaysia, so why 2 of them not part of the listed co, Petronm? That's because the two of the private co were not listed back then when it was own by Exxon Mobile. So Petron Corp bought all 3 companies separately. So the structure remain until now. Well, it is always possible that Petron Corp may inject the other 2 non-listed co into Petronm in future to consolidate the operation in Malaysia.
2) Peso 1.5bn net income is net income before minority, which means it is 100% of Malaysia operation. So don't need to regross it.
2017-05-13 11:31
thanks sumato88 sifu.
good jobs.
sumato88 sifu, how you expect petronm earning for this year?
2017-05-13 11:47
what are the business difference between petronm, petdag and shell?
why petdag is trading in PE25 and petronm is only 8.
2017-05-13 11:56
All these good result haven't even considered future growth some more. With more stations, potentially higher income.
I am super positive on Petronm now. It is now my third largest in portfolio. Maybe I will make it second largest soon
2017-05-13 12:03
@ probability, I just sharing what I think is correct & useful info. Anyway thanks to sumato88 to make it more accurate and precious on the estimation.
Hopefully we are benefit from this useful information and make some good $$ out of it.
Cheers & have a nice weekend to all Petronm believers, believe me this is just the beginning of our journey, many more to come.
2017-05-13 12:16
逍遥子 you are so humble...glad to have found you in i3. have a nice weekend too..
2017-05-13 12:18
plane
don't be so silly
every single dollar this company is subject to government saying Yes.
we the consumers have a right to demand the government protect our interests and lower the price.
2017-05-13 12:23
Thank you Sumo for your good clarification.
I am convinced that Petron will post a good set of result coming weeks...
2017-05-13 12:24
Yes, i think more will be convinced this time..., Many have fall towards calculation the percentages of listed to unlisted company and calculate from there they derived the profit... . Which is one of the way.Many have done this errors ...Simply by maths cannot arrive to the value in business, must understand the business as a whole. Anyway stay tuned for the result.
CC and Petron M is my holdings..
2017-05-13 13:11
Dear shift Sumo, may I understand whether if only 74% of the PETRONM earning to be contributed to the mother company Petron Corp? If so, the earning contributed during Q1 2016 shall be 74% of 16mil, which is 11.8mil, thus, the contribution from other 2 non listed co shall be 18.2mil. Making the same assumption of 10% growth, the earning of the 2 non listed co Q1 2017 shall be around 20mil. With this, the earning contribution to Petron Corp by PETRONM Q1 2017 will be 110mil (74%). So the 100% earning of PETRONM Q1 2017 would be 148mil?
2017-05-13 14:23
C NG, I am pretty sure Peso1.5bn of profit is 100% of Petron Malaysia operation, like wise, Peso 345m profit in 1Q16 or RM30m is also 100% of Malaysia operation. Don't think this quarter gonna make RM148m, perhaps 2Q17.
2017-05-13 17:53
Kuokseng, I expect RM400m profit for FY17, that means each quarter RM100m, anything above that is a bonus to me.
2017-05-13 18:02
Same question as me... I thought petronm including refinery and petrol station
2017-05-14 09:12
Petronm actually own 300+ petrol stations + refinery plant, the rest of 200+ petrol stations own by Petron Fuel International S/B, Petron Oil S/B & other individual authorise dealers. Simple as that
2017-05-14 10:34
suregain, looks like you are not fully understand PetronM businesses. Because of this ignorance, fear has conquered you. You can't be successful if you're ruled by fear. Back to basic, you need to do own study and fully understand their businesses, how they make money and etc. Not asking questions on the forum and looking for answers btw posted negative comments and hope to drag the price down.
FYI, retail business is referring to kedai runcit under the brand of "Treats".
2017-05-14 10:35
Lord94, looks like u dun even understand my q... Im not asking wat is retail bisnes.. Who dun know petron has treats, petdag has kedai mesra, shell got select shop? Im just wondering y they keep on saying petrol stations r under non listed entity whereas petronm stands for petron refinery n marketing.. Now 逍遥 has clear my doubts.. So next time dun simply simply make remarks on ppl....
2017-05-14 10:55
so already clear your doubt, just let go petron lor, since you can look far beyond next quarter.
2017-05-14 11:20
@逍遥子, you mentioned above that 200+ petrol station own by Petron Fuel International S/B (PFISB), that's quite a number there, would you mind to share where to get this information from?
If indeed 200+ of petrol stations own by PFISB, means these petrol stations wont be included in PETRONM profit, so it is like left 100+ of petrol stations (also, it would not be good if those good biz in city area (big one) are own by PFISB only) plus its refinery plant only, if based on this mentioned figures it seems to be refinery biz still the major contribution part on their earning.
Those petrol stations biz in klang valley seem to be good but it seems like no point if those petrol stations are belongs to PFISB and the remaining one (rural area or not big city) are left for PETRONM only (i just made assumption, i dont have the actual info yet about this area)
Please help to correct and advice me if my understanding is wrong.
Appreciated that.
Thank you.
2017-05-14 14:34
or by any chance we can know those petrol stations are actually owned by which entity?
2017-05-14 14:42
Sumato alredi said. Simple math......If still don't understand. Don't buy stocks.hehe.
2017-05-14 14:46
Ha ha ha..... paperplane agree with u !!!
I found that the young people now a days don't like to read carefully, and like to jump into the conclusion ! What is the total Petron stations in Malaysia ??? Annual report write it out clearly there, but people won't border to go and read.
2017-05-14 15:35
Yeah, don't do homework themselves, keep asking only for tips and guidance. When stock price went down cry father mother, no patient to hold for at least five years. Like that wanna spear big money! Impossible! This why all go play money game, jjptr. End up ggptr. 普通人Gg.
2017-05-15 01:38
Pls refer to my previous analysis for Petronm, http://klse.i3investor.com/m/blog/sumato88/118086.jsp
The 2 non listed co named, Petron Fuel International (formerly ExxonMobil Malaysia) & Petron Oil (M) (formerly ExxonMobil Borneo). If you read its annual report, you will realize that 6 out of 11 terminals (for crude oil and refinery product storage before distribute to petrol stations) that Petron Malaysia owns and operates are owned by the sister co, which I believe it is parked under Petron Fuel International. Out of the 6, 3 terminals are Sabah based.
Given that Petrol Oil was formerly known as ExxonMobil Borneo, we can draw to a conclusion that petrol stations in Sabah is owned by sister co.
Terminals in Penang, Port Dickson, KLIA, and Klang Valley Distribution Terminal are owned by listed co. This implies that the high volume stations in Klang Valley are mainly owned by listed co. So you tell me, how many % of its petrol station sales derived from Klang Valley and Penang? I would think the sales proportion is higher than the proportion of the numbers of petrol stations the listed co own.
2017-05-15 09:31
@sumato88, thanks for your response, I appreciated that. Noted on your message above.
2017-05-15 10:27
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This is good
2017-05-13 07:44