Posted by dragon328 > 2022-08-16 14:21 | Report Abuse

I was not aware of such a short position in AEON but 5m shares are not big.

I suspect most of these short positions were entered into in May when AEON share price was trading at RM1.55-1.69 and daily volume exceeds 3.0 million shares. With the subsequent drop in share price to RM1.26-1.28, I think most of the short positions had been unwound then, left now with net 5.0m shorts.

I expect these shorts will be covered soon when the shorties see that share price is well supported and an excellent June quarterly result announcement is coming in 2 weeks.

Posted by TreeTopView > 2022-08-16 14:55 | Report Abuse

Hi dragon......unfortunately your summation of the short position is not accurate.

The net short position has been gradually increasing for quite some time and has only stopped quite recently. This has been one of the reasons I decided not to enter into the stock, as there appeared to be another game at play going on.

Once it went above 5 million shorts it started to slow down, with not much covering going on. This is something worth watching daily to see if anything substantial changes, imo.

I'll keep watching :)

Posted by dragon328 > 2022-08-16 16:17 | Report Abuse

@TreeTopView, thanks for highlighting the short positions.

To me, these shorties are just speculative. I do not see any big risk of share price collapsing anytime soon, unless another war would start at Taiwan straits or another MCO would be announced.

Too much gaming / betting on shorts and I do not want to spend much time analysing them, but rather focus on fundamentals.

Posted by dragon328 > 2022-08-16 21:06 | Report Abuse

Looking at the just released June quarterly result of BJFood, I think AEON will follow suit and post a strong set of result for this June qtr

Posted by dragon328 > 2022-08-23 21:01 | Report Abuse

AEON Bhd indeed posted a strong set of results for June quarter with revenue even surpassing the Dec 2021 qtr and profit before tax of RM92.3m, just shy of the record Dec 2021 qtr PBT of RM94.6m.

The disappointment came from the much higher than expected taxation rate of 48.75% vs the normal 25% registered in Q4FY2021.

Posted by dragon328 > 2022-08-23 21:11 | Report Abuse

Operating cashflows before tax and capex was strong at RM283 million for 1H 2022, annualised to RM565 million. Again the cash tax was high at RM52 million, higher than usual 25% plus prosperity tax.
Anyway it is way higher than the operating cashflows of RM455m for FY2021.

Posted by StartOfTheBull > 2023-01-31 11:46 | Report Abuse

Recovery stocks, is this one still being ignored?

Posted by StartOfTheBull > 2023-02-03 11:10 | Report Abuse

Pavreit, Sunway REIT, and more have delivered very good latest financial reports.
AEON Malaysia, with 24 malls across the country.
How much longer will it be ignored by investors?

Posted by firehawk > 2023-02-22 18:15 | Report Abuse

Q4,2002:
The Company registered a profit before tax of RM45.6 million for the quarter, as compared to a profit before tax in the corresponding quarter of RM94.6 million, which recorded a 51.8% decline, mainly due to the increase in promotional activities, maintenance costs and lower reversal of impairment of receivables.

Posted by DickyMe > 2023-02-22 18:20 | Report Abuse

You are quoting
"Q4,2002"???
Did Aeon exist then?

Posted by DickyMe > 2023-02-22 18:21 | Report Abuse

65 sen coming soon!

Posted by StartOfTheBull > 2023-02-22 18:41 | Report Abuse

No worries, dividend 4c can support share price. Expecting better next quarter.

Posted by Chinjason > 2023-02-22 19:25 | Report Abuse

can we get cheap ticket tomorrow?

Posted by StartOfTheBull > 2023-02-22 19:33 | Report Abuse

October to December 2022:
Revenue RM1,062 million
Profit RM25 million
EPS: 1.77c
This is actually much better than previous quarter.

July to September 2022:
Revenue RM982 million
Profit RM11 million
EPS: 0.78c

Tomorrow, up.

Posted by DickyMe > 2023-02-22 19:35 | Report Abuse

Dubious!

Posted by dragon328 > 2023-02-22 20:52 | Report Abuse

disastrous performance in Q4, super high tax rates, high lease liabilities payments, non-responsive management, lousy finance and tax department, high maintenance costs, and costly promotional activities that yielded no result.

The business and brandname itself is good, but the local management team is lousy. Can't help it.

Posted by dragon328 > 2023-02-22 20:53 | Report Abuse

I will stop following this company until a change in the management to the better.

Posted by dragon328 > 2023-02-22 20:54 | Report Abuse

The only saving grace is a final 4.0 sen dividend, which can support a share price of RM0.70.

Operating cashflows are still strong but a lot were spent on high maintenance costs, high lease liabilities and useless promotional activities

Posted by DickyMe > 2023-02-22 21:36 | Report Abuse

"Aeon itself all along umpteen years never had any problem with shoplifting due to tight internal controls. Virtually zero cost."
===============================

Am I living in dreamland? Kick me!

Posted by DickyMe > 2023-02-22 21:38 | Report Abuse

"Operating cashflows are still strong but a lot were spent on high maintenance costs, high lease liabilities and useless promotional activities"
------------------------------------------------------------

This is the standard modus operandi to siphon money from any listed company

Posted by DickyMe > 2023-02-22 21:43 | Report Abuse

There is something called ANNAL Report which gives a peek into the financial status.
I have been to Aeon, just for shopping essential.
Yes, I do
Did that answer the questions?

Posted by Chinjason > 2023-02-23 00:05 | Report Abuse

flyflyfly tomorrow

Posted by dragon328 > 2023-02-23 09:24 | Report Abuse

i3lucker

Your point on AEON having reduced issue of shoplifting compared to the old Carrefour may be right, but we should not overlook the other shortcomings of the current AEON management.

The utmost responsibility of the management of a listed company is to safeguard shareholders' interests and manage the company well to create more value for the shareholders. Otherwise why bother with listing?

The current management seems to have focused on the wrong things without clear strategy on how to expand and improve earnings.

They have spent millions of dollars on digital transformation which has obviously yielded little result (note online revenue was only RM24m for 2022, not even 1% of the annual revenue). Though it may have incorporated and digitised data from hundreds of suppliers but this has not transformed into any apparent saving in bulk purchase. Total revenue may have increased by 6% in Q4 but earnings fell over 60% from last year.

The management has not got the maintenance and expenses in check, allowing it to eat into the profit (net profit fell 65% from Q4 2021) as well as cashflows (capex has doubled to over RM110 million in 2022 compared to RM65m in 2021).

They have replaced a local good capable MD in Samsuddin with 3 Japanese (1 MD and 2 deputy MDs), obviously the salary and remuneration package is different for these 3 expats, and they seem to be irreplaceable (one of them is the son of AEON founder) and are here to stay for years.

They may not be well verse with the local retails market and hence the strategy being implemented has resulted in much higher expenses and lower profits.

Posted by dragon328 > 2023-02-23 09:40 | Report Abuse

The current management is particularly weak in corporate finance and taxation.

This is visible from the super high taxation rate of 45.4% in Q4 2022, and unbelievably high cash tax rate of 62.7% in 2022. Just imagine, for RM211.4 million of pretax profit registered for 2022, AEON paid cash tax of RM132.5 million. I checked with AEON public relation officer and the reply was that the high taxation rate was due to cukai makmur and some disallowed items for tax deduction. That simply did not explain a thing.

The company accounting team has allowed the lease liabilities to balloon to a whopping RM1.612 billion, almost reaching 90% of total equity of RM1.80 billion. The reply from the company was that these lease liabilities are capitalised long term leases from third party shopping malls. They charged out total RM258.7 million of lease liability interests and payments into cashflows statements in 2022. This implies an averaged 6 year of leases being capitalised. One would question why they need to capitalise so much of such lease liabilities and whether such practice has unintentionally increased the cash tax payments to the taxman while increasing the accounting profits.

Posted by Chinjason > 2023-02-23 17:54 | Report Abuse

Hopefully budget 2023 to be announced tmr will benefit Aeon indirectly

Posted by DickyMe > 2023-02-23 19:00 | Report Abuse

Giant hypermart closing down Malaysia chapter.

Posted by Blue Tulip > 2023-02-23 20:54 | Report Abuse

If Kenanga ask to BUY, you must consider SELLING.

Posted by StartOfTheBull > 2023-03-06 12:40 | Report Abuse

I think this stock is showing sign of declining with latest bad QR announced. A 4c dividend proposed also can't move up the share price.
I guess I should wait for the opportunity at better price to exit.

Posted by dragon328 > 2023-03-13 14:12 | Report Abuse

Rambutan9, the share price movement of Aeon is a reflection of what the company has achieved in terms of financial performance. As I said above, the Q4 qtrly result was a disaster with no visible improvement on any of the areas I suggested before, i.e.
- the high taxation rate
- the increasing lease laibilities
- the accounting policy that capitalises a lot of these lease liabilities
- the weak corporate finance team that fails to adopt sound finance practices
- an uncontrolled capital expenditure program on digitisation which has so far yielded no visible result
- an incompetent management that is not willing and possibly incapable of carrying out material corporate restructuring to a leaner REIT structure that minimises tax and improve cash holdings
- a weak economy and a competitive retail landscape which limits growth
- uncertain external factors and weakening ringgit
- foreign funds pulling out of Bursa

AEON has a good business model and the underlying business generates good operating cashflows. However, without a determined and capable management, the company is going nowhere.

I will only revisit it when there is a change in the management or a change in the attitude of the management, or share price drops below RM1.00.

Posted by dragon328 > 2023-03-13 14:19 | Report Abuse

We should invest in a company with good management that always tries to improve shareholders' value. No matter how much earnings the company makes or how much cash the company has, if the management does not do what is best for company shareholders, eg. spending big on unnecessary capex program that yields no visible result, paying high rentals to third party shopping mall owners, contented with high amounts of debts and serve increasing interest expenses, etc, then there is no point putting your money into such a company stock. You won't see growing earnings nor dividends.

I would rather put my money into other retail companies with net cash position and capable management like Padini who knows how to contain costs and expand at the right time to improve earnings. Even Bonia and SEM do much better than AEON in terms of growing shareholders' value. AEON management is getting too complacent, if it continues going on like that, its market share will sooner or later be eaten up by other retailers.

Posted by dragon328 > 2023-03-13 16:27 | Report Abuse

I had earlier projected a net profit of RM202 million and operating cashflows of RM660 million for FY2022. AEON ended up with a net profit of RM111.2 million and operating cashflows of RM434 million only. The shortfall was due to:

- higher than expected taxation rate of 47.4% for FY2022 vs expected 35%
- substantially higher unallocated expenses of RM120 million vs expected RM87 million
- lower EBIT of RM224m from the retailing segment vs expected RM241m (as a result of thinner margin and higher expenses on digitisation)
- lower EBIT of RM219m for Property Management segment vs expected RM232m (as a result of lower savings in electricity and higher leases)
- substantial increase in capex to RM118.4m in FY2022 from RM67m in FY2021

Though FY2022 revenue actually went up by 4.4% vs expected and by 14% vs FY2021, the management has so far failed to translate the higher revenue into higher earnings mainly due to its ineffective capital/corporate structure and ineffective capex program/IT initiatives.

There is nothing we as minority shareholders can do if the management is happy to pay out almost 50% of earnings to the tax man and pay about RM260 million of lease liabilities payments to other parties. Net Profit will remain low and dividends remain low and no growth ensues.

Posted by StartOfTheBull > 2023-03-16 09:36 | Report Abuse

Sold.
Currently overvalued, even EPF has turned from buyer to seller.
I afraid more downside risk to RM1.00 ex dividend.

Posted by hw0706 > 2023-03-27 05:37 | Report Abuse

Below 70 sen.. retailer in malaysia will have tough time going forward

Posted by lilysmith9896 > 2023-04-06 11:50 | Report Abuse

If the price drops below 70 sen, it will be difficult for retailers in Malaysia to compete in the future. https://backroomsgame.net/

Posted by StartOfTheBull > 2023-04-06 12:35 | Report Abuse

With more and more retail shops and malls joining the competition AEON may spends more on promotions to stay alive in turn dragging down its profitability.

Posted by firehawk > 2023-04-06 16:37 | Report Abuse

We maintain our OVERWEIGHT call with our focus still on the retailers. Despite sustained high inflation, we expect consumer spending to stay resilient in the absence of any immediate plan by the government to rationalise subsidies or reintroduce the GST, while the B40 group continues to benefit from various financial assistance programmes especially direct cash handouts. Also helping, are a relatively stable economy and a healthy job market, coupled with a strong household balance sheet of the M40 group. Our sector top picks are AEON (OP; TP: RM1.80), PADINI (OP; TP: RM6.00) and QL (OP: TP: RM6.66)

Source: Kenanga Research - 6 Apr 2023

Posted by dompeilee > 2023-04-17 18:16 | Report Abuse

Bought AEON @ 1.22 for the dividend to be declared soon.

Posted by dompeilee > 2023-04-18 17:13 | Report Abuse

Closed at the high...Nice!

Posted by James Ng > 2023-05-22 21:53 | Report Abuse

[转贴] [Video:浅谈AEON CO. (M) BERHAD, AEON, 6599] - James的股票投资James Share Investing
https://klse.i3investor.com/web/blog/detail/general/2023-05-22-story-h-269784967

Posted by wah168 > 2023-05-24 15:14 | Report Abuse

add more. good stock

Posted by sunnyspoon > 2023-05-25 12:44 | Report Abuse

Buy

Posted by vinvin > 2023-06-15 16:04 | Report Abuse

Dear friends, can anyone let me know how much is the dividend they are declaring? Thanks.

Posted by DickyMe > 2023-07-06 12:37 | Report Abuse

RM 1.00 coming soon!

Posted by $$ BUYSELL $$ > 2023-07-06 12:44 | Report Abuse

sinking ship hahaha

Posted by smallrail > 2023-07-06 12:49 | Report Abuse

why consumer stock all sink 1 by 1

Posted by Pinky > 2023-07-06 18:09 | Report Abuse

Drop then you accumulate la

Posted by smallrail > 2023-08-07 11:05 | Report Abuse

@Pinky accumulate then drop more!!! 1.18 now

Posted by Pinky > 2023-08-15 19:00 | Report Abuse

I will buy when I can get dividend yield 4.0% from AEON

Posted by ABSBOSS > 2023-08-22 23:25 | Report Abuse

As expected profit reduce..price in already ...

Posted by smallrail > 2023-08-24 08:44 | Report Abuse

now rm 1.13 already, profit also drop, still buy more?