Increases in liabilities are treated as source/inflow of fund, and increases in assets are treated as outflows.

In order to prepare a statement of cash flows, you have to look back at the comparative balance sheets for XYZ company. From the two years of balance sheet data and some income statementdata, you build your cash flows statement.

mkmk, It will be a lot easier if you have an accountant friend to explain the making of cash flow statement to you.

Cash flow does not necessarily involves funds flow in and out of bank account. If you know how a cash flow statement is prepared, then you know what I meant. Anyway, believe what you believe, no worries.

Yes, generally speaking ASSETS.

Sorry, I don't know enough to provide specific answer.

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mkmk DK66, better u said asset la like that... haiyoo...
22/12/2018 17:16

All payments will follow the contractual terms.

Banks, receivables, deposits, prepayments

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mkmk DK66, if the gkhl credited advance from customer, where they debit the other leg?
22/12/2018 17:06

Exactly. That is why I still maintain my stand that Jaks doesn't need funding for its vietnam jobs.

But many do not believe.

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SarifahSelinder DK66 if bank bank China willing to pay the suppliers first JAKS mana ada cash flow problem for d EPC contract?
22/12/2018 17:03

If I m an insider, I can't be talking here. Otherwise, I will be in trouble.

I m not an insider

Sarifah, It is the JV, JHDP who borrowed from the 3 chinese banks. Therefore, all disbursements of loan are made in the name of the JV who is the borrower.

With limited disclosure of information in the AR, unless with insider information, we can't be absolute sure of our thoughts. We can only rely on our knowledge of the industry and make the most logical assumptions.

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SarifahSelinder How u know that?
22/12/2018 16:48

SarifahSelinder If progress payment supplier dah paid it wil b term loan kan? Y advances from jv?
22/12/2018 16:49

These advances were used to make progressive payments for the equipment. It doesn't flow into Jaks' sub bank accounts

Sarifah, the reason why it is included in Jaks' AR is due to consolidation of group accounts. It doesn't mean there is real cash flow in and out of Jaks' bank account.

Jaks' subsidiary, Golden Keen Holdings Ltd (GKHL) was given the EPC1 contracts. Though entirely subcontracted to CPECC, it still has to account for the book entries.

Advances from JHDP for the purpose of progressive payments for fabrication of equipment is normal for project of this magnitude. These entries will be taken up in GKHL's book and consolidated into Jaks' accounts.

The actually billing for the respective works can only be done when the equipment are installed and certified for fitness. That is when the advances will turn into revenues. Until then, the advances will park as payables.

It is not logical to assume that the banks are loose in dispersing the loan and allow the funds to be used otherwise.

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SarifahSelinder DK66 advance payments tu not in JV account but in JAKS account

Sarifah, I don't understand your point
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SarifahSelinder DK66 taksiran u ni not supported by the Annual Report

The purpose of the fund raising is meant to EXPEDITE (not fund) the vietnam works, but it is clearly written in the JV agreement that the entire EPC contract awarded to Jaks must be entirely subcontracted to CPECC. So, how essential is this fund raising exercise ? How essential can it be if it is not underwritten ?

Whatever the case maybe, the next qtrly results will provide the answer to your question. If the WRI is indeed critical, you will see slow or no progress in the construction of the power plant.


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anticonman If true why need recent W RI? Even RI undersubscribed how to address shortfall cash flow?

Posted by DK66 > Dec 22, 2018 09:31 AM | Report Abuse
Jaks do not have control over the cash flow of JHDP. Thus, couldn't be able to "misappropriate" the funds for its domestic operations.
22/12/2018 10:30

Jaks do not have control over the cash flow of JHDP. Thus, couldn't be able to "misappropriate" the funds for its domestic operations.

Advances from JHDP are loan from 3 Chinese banks. The money cannot be used for any purposes other than the power plant.

GoHaiDuongGo,

You are right to point this out. However, the warrant prospectus pointed out that the overall plant completion was 34% (I presume as at Sept) and Jaks reported 31.7% completion in its Q3 report. A difference of around 2%.

Now that the overall completion was at 41% as at Oct 2018, is it logical to assume Jaks works was so far behind ?

Bear in mind, Jaks was not involved in the construction works at all. Its "assigned" works were the ancillaries works to the main structural works. So, the progress cannot be too far behind. And I have assumed zero progress in Nov and Dec.

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GoHaiDuongGo DK66 always provide factual and objective postings.
However, I feel compelled to point out he has unknowingly erred in his recent posing

“”””””Jaks' CFO stated that the power plant was 41% completed as at October but Jaks only recognised about 31% completion until Sept. Assuming no progress in Nov and Dec, Jaks may recognise 10% work done which means potential of RM45m profit from vietnam EPC in Q4 2018. “””
epc 1(30%) + epc 2 (70%) =HaiDuong(100%)

Q3
(31% x30%) + (??% x70%)=(??% out of 100%)

September
(XX% x30%) + (YY% x70%)=(41% out of 100%)
Try XX=31 , YY =45.2, You get 41%

Try XX=35 , YY=43.6, You get 41%
21/12/2018 14:05

12月15日，公司承建的越南海阳2×600MW燃煤电厂工程2号机组主厂房钢结构主体框架顺利安装完成。
　 2号机组主厂房钢结构工程由青岛东方铁塔股份公司深化设计，华业钢构有限公司进行制造，总工作量约为7365吨，占地面积约为5291㎡，其中汽机房横向范围为13～23轴间距为 100m，纵向范围1/0A ～B排间距为36m。除氧煤仓间横向范围为13-26轴间距为130m，纵向范围B～D排间距为19.7m。±0.00m相当于越南Hon DAU高程系统的5.050m。2号机组主厂房钢结构安装施工范围为1/0A～D排，固定端到扩建端方向为13-26轴。主厂房钢结构主要由钢柱、钢梁、钢支撑等构件组成，其中最重件约为40.398 吨。

　　2号机组主厂房钢结构安装于2018年4月15日正式开始施工，项目部前期精心策划，对设备供货顺序、厂房安装顺序、吊车选型及站位都做了充分的准备，过程中克服了设备到货不及时、未按安装顺序进行发货、设备缺陷较多等问题，圆满完成了钢结构主体框架安装任务。

12月17日，越南海阳电厂TT5转运站D1轴钢立柱安全吊装就位。
　　TT5转运站上部结构为钢构架结构，占地面积600.75㎡，横向A～D轴间距为22.5米，纵向1～4轴26.7米, 设计标高±0.000m相当于绝对标高5.050m，本工程为横向刚接、纵向铰接加垂直支撑的钢框架结构，设计结构钢采用热轧H型钢和热轧T型钢，单根最重8t。
　　由于现场施工环境复杂，为保障吊装安全，越南海阳项目部技术人员从实际出发，提出专项方案，并在施工前对各种数据进行大量的推敲演算，通过对吊装技术可行性、安全性、进度成本分析，制定出安全系数大、技术数据全面的安全技术措施。施工中组织专门人员对吊装的关键点进行监控，发现隐患及时整改落实。TT5转运站D1轴钢立柱成功就位，拉开了越南海阳电厂输煤系统钢结构安装的序幕。

12月7日，随着启备变顺利抵达工程现场，越南海阳总承包项目第二批大件设备全部抵达工程现场，为确保机组按期投产赢得了时间。

　　第二批大件设备包括21号锅炉、22号锅炉汽包，启备变、1号机组高厂变、2号机组高厂变。最重件为锅炉汽包，汽包本体重184吨，尺寸为24.19米×2.26米×3.2米。

12月18日，公司承建的越南海阳2×600MW燃煤电厂二号机组1号锅炉板梁层顺利通过EPC、OE的联合验收，验收结果满足规范要求，为下一步汽包吊装及受热面安装奠定了基础。

Iamxuewen, Good morning

Both can. More aggressive investors will buy warrants as it provides higher leverage.

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Investor48 DK66
Please advice buy mother or warrant..?
Which one better..?

Thanks..
20/12/2018 21:24

It was the surprise Q3 loss results that caused the selling and the severe under subscription of warrants. The bright side is less dilution from (33% to 15%) for both mother and warrants.

The losses was due to unusually slow progress billing of the vietnam EPC contract.

Jaks' CFO stated that the power plant was 41% completed as at October but Jaks only recognised about 31% completion until Sept. Assuming no progress in Nov and Dec, Jaks may recognise 10% work done which means potential of RM45m profit from vietnam EPC in Q4 2018.

Public investment has indicated that profit recognition of vietnam EPC contract will follow "S" curve. Hence, there will be faster profit recognition hereon as the construction of power plant enters into equipment installation phases. The power plant will be substantially completed by end 2019 as it advances into synchronization and performance testing before it starts to generate electricity by mid 2020.

Q4 2018 will mark the turnaround in results. The results will be announced before end feb 2019, and it will mark the end of winter for Jaks.

It was the surprise Q3 loss results that caused the selling and the severe under subscription of warrants. The bright side is less dilution from (33% to 15%) for both mother and warrants.

The losses was due to unusually slow progress billing of the vietnam EPC contract.

Jaks' CFO stated that the power plant was 41% completed as at October but Jaks only recognised about 31% completion until Sept. Assuming no progress in Nov and Dec, Jaks may recognise 10% work done which means potential of RM45m profit from vietnam EPC in Q4 2018.

Public investment has indicated that profit recognition of vietnam EPC contract will follow "S" curve. Hence, there will be faster profit recognition hereon as the construction of power plant enters into equipment installation phases. The power plant will be substantially completed by end 2019 as it advances into synchronization and performance testing before it starts to generate electricity by mid 2020.

Q4 2018 will mark the turnaround in results. The results will be announced before end feb 2019, and it will mark the end of winter for Jaks.

Yes, but Advances normally refers to pre-payments for works yet to be carried out. It is not really a "payment liability", and it will be "repaid" via future work done. For accounting purposes, it is park under liabilities initially and subsequently "transferred" to Revenues when the work is done and billed.

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SarifahSelinder DK66 memang info x cukup no t clear
19/12/2018 17:09

There isn't a lot of information on the advances amount. It is shown under amount due from customers for information purposes.

As the same amount is included in Other payables, a logical explanation would be the amount being Advance Payments made by customers as required under contracts for works yet to be carried out. This is normal in construction.

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SarifahSelinder DK66

Apa ni advances?

Advances received from customer
(included in other payables) 276,926,850 101,944,350

Sarifah, l will discuss with my accountant friend on the "advances" and get back to you.

For someone who doesn't know much about Jaks and the potential of its Vietnam power plant, best to stay away.

Calvin, there are millions of new court cases every day. So, stop buying stocks ??

unfortunately, it is very difficult for young investors to differentiate between angels and devils.

I m not here to promote Jaks. I have nothing to gain. I just thought i3 can be a place to share my knowledge but just too many people with evil intentions.

Jaks did 2 10% private placements recently at 1.36 and 1.38 to institutions. These are professional investors.

Jaks domestic problem, which will be resolved eventually, is nothing compared to the earnings from power plant.

Alex, I m not sure about knm, but Jaks Vietnam power plant provides huge recurring income for 25 years.

Calvin, CPECC is a very capable name in coal power plant. Why would it sue Jaks ? Just imagining ??? or try to scare ?

It's equity investment in the Vietnam power plant is about RM600m

Jaks has 40% ownership rights to a RM8 billion power plant in Vietnam, and it is only worth RM200 m market capitalization ???

Why is this forum so crowded if Jaks is good for nothing ?

What is the point of writing long article when people rather listen to gossips ..... pitty

I absolutely agree with david

lizi,. they only undertake to subscribe 16% only

12 more months to completion

Vietnam power plant will be completed by end 2019 and commence operation in mid 2020

Ang's group 33% (based on EGM voting) took up all their entitlements together with 4.5% minorities.

I see Andy Ang smart and competent enough to pull thru the Vietnam IPP which is a game changer for Jaks. What criminal behaviour ?

I like to hear credible rationales why Jaks will fail. It allows me to reconsider my research and revisit areas which I might have slipped.

Mr Koon has at least given his fundamental reasons for his departure from Jaks. He believes Jaks will continue to make losses due to high interest costs.

Investor48, I m just someone who see Jaks a gold mine. I did enormous amount of research on its Vietnam IPP. I share in i3 hoping to help many.