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Showing posts from October, 2008

Next Generation

Today is Public Address of HKSAR Chief Executive Donald Tsang. He answered a question about the passing of financial positions in the press conference after the public address.

He said that everyone should prepare to pass his duty to his followers. He pointed out that Joseph Yam was older than 60 and should consider the issue of duty relay.

Let the new generation be on duty and make HK be vital. This is true!

U-Right

It is announced that U-Right (HKEx: 627) is under liquidation due to 1.2 billion liability. Is it a surprise?

Reading the latest financial statements announced on 24 Aug 2008, we found that it earned a profit of HK$58 million last year with 1.6 billion current assets and 796 million current liabilities. By the numbers, it sounds a good company, doesn't it?

Unfortunately the company's stock trading has been suspended since 17th Sep 2008.

Interestingly there is a post about U-Right liquidation in a HK forum on 8th Oct 2008.

Where does the liability come from? Why does it do suddenly? Why does the financial statements not alert the problem?

As a retail chain, it needs cash turnover. Cash turnover is very critical, especially for sales and manufacturing parts. Current liabilities and overdraft are very high between seasons and become lower after mega sales, so they will not be shown in the statements.

1.2 billion current liability is not strangely high and the company should be able to …