DB annual report 2016




Front page of the DB annual report 2016


The report in full you can find here and for my previous summary of the DB annual report 2015 then please click on that link and to find out more about DB then visit DB analysis 2016.

Last year they had a Cost/Income ratio of 115%. This year their C/I was 98%. In my world costs are what you have to pay and income is everything that you get coming in. By the look of it DB is calculating this slightly different since they managed to go -1.4 billion € for the full year which to me is not a positive value which 98% would indicate. They had an income of almost 26 billion € which should then mean an income of around 500 million € but alas no. The income has been pretty flat for the last four years and the costs are mainly low due to them having to pay for their latest criminal activities which ever latest popped up. Still last year DB lost around 6.8 billion € so we might go in the good direction. 


Financial statement of DB 2017


Conclusion: It is every shareholders hope that now that DB brought in some more capital that they actually manage to get back on the horse and that there will be no more discoveries... to my knowledge, in the pipeline, we still have Iran and Russian money laundry and then we have the much exciting Italian situation. Will that be the end of it? I unfortunately do not think so still... I will remain as a shareholder and as you know I did buy more shares in April.

Analysis of Coba 2017


Logo of Commerzbank 2017

Company: Commerzbank 

ISIN DE000CBK1001 | WKN CBK100 

Business: A German bank. Their five pillars are: Private Customers (accounts, credits, wealth management etc.), Mittelstandbank (medium sized companies as well as institutions), Central & Easter Europe (mBank big in Poland), Corporate & Markets (Corporate finance, equity, currencies etc.) and finally Non-Core Assets (Real Estate and ship-building). They actually only claim to have four pillars but I prefer to add their "bad bank", the NCA, as the fifth.

Active: Claim presence in 50 countries. Europe with Germany and Poland the biggest. 

P/E: 42.5

Here you can find the previous analysis of Coba 2016


Contrarian analysis of Coba 2017

The P/E of Coba is shockingly high with 42.5 which comes from very poor earnings but either way the P/B is very good with 0.4 which gives surprisingly enough a go from Graham. The earnings to sales a very poor with 3% and the ROE is laughable with 1%. The book to debt is as always very unpleasant which is normal for the German banks by the look of things.
In the last five years they have had the indecency of showing a yearly negative revenue growth rate of -7.5%. This is of course not good at all and it gives a motivated P/E of around 8 which means that Coba is today overvalued by the market.
They pay no dividends but on the other hand since they do not manage to bring in any earnings this is also how it should be.

Conclusion: Graham kind of says yes and I say grrr. I really thought that the turn around had started but that was clearly not the case. My patience for the German banks is very low at the moment. The only value looking ok is the P/B value and every other looks today very bad. It is interesting to see how fast things can go bad again. I will remain as a grumpy shareholder.

Coba annual report 2016


Front page of the annual 2016 report from Coba

For the report in full then please click here and for the previous brief summary then please visit Coba annual report 2016 and to find out more about Commerzbank then please go to analysis of Coba 2016.

In the financial statement below we can see the same trend going on as it has done from the very first day that I bought Coba back in 2012. Less income, less income, less income. Everything just keeps going down year by year quarter by quarter. It is not a happy sight to see. Their Cost to Income ratio is up at 75.5%. Their earnings are silly low with only 279 million € coming out in the end which is the equivalent of 0.22 € per share. Last year they paid out 0.2 € in dividends and this year dividends have been cancelled again. To me this clearly shows that the managers do not even have a clue how far out on the scale of trouble Coba is. The capital ratios have improved ever so slightly but the facts remain that Coba is still not a healthy bank.


Financial statement of Coba 2016


Conclusion: Last year I thought that Coba had reached the turn around point which was part of the reason for why I pushed in some more money into it. Now we are back the the previous trend again and I do not see the turn around besides from in the share price that have improved significantly lately. I will remain a grumpy shareholder.

Analysis of Cez 2017


Logo of Cez 2017


Company: Cez 

ISIN CZ0005112300 | WKN 887832 

Business: A Czech electricity producer and distributor. They offer heat and gas to consumers and are active with telecommunications, informatics, nuclear research, planning, construction and maintenance of energy facilities, mining raw materials, and processing energy by-products. 

Active: Czech Republic, Poland, Bulgaria, Hungary, Slovakia, Romania and in Turkey. They wanted to step into Germany buy buying assets from Vattenfall but have currently taken a step back from that position.

P/E: 16.2

Here you can find the previous analysis of Cez 2016

Contrarian analysis of Cez 2017

The P/E is too high for my liking with 16.2 but the P/B is still good with 1.2 which gives us a go from Graham. The earnings to sales are ok with 7% but the ROE is awful with only 7.3%. The book to debt ratio is looking very good for an energy company with 0.6.
In the last five years they have had a negative yearly revenue growth rate of -0.8% which is pretty bad and this gives us a motivated P/E of 8 to 10 which means that Cez is today overvalued by the market.
They pay an excellent dividend in the size of 9.1% which correspond to almost 150% of their earnings so either they will soon have to stop these dividend payments or they need to shape up and bring in more earnings. I prefer the latter.

Conclusion: Graham says yes to Cez and I am not so happy with it. If it would not have been for the massive dividends that they pay out then I would probably have walked away even though P/E is so, so and the P/B is good. I will remain as grumpy shareholder.

Cez annual report 2016

Front page of the annual 2016 report from Cez

For the report in full please go here, to see the previous summary please visit Cez annual report 2015 and to find out more regarding Cez then click on analysis of Cez 2016.

As we can see in the table below Cez is on a slipping slope downwards and in the last two years they have not managed to bring in the money needed to pay out the dividend of 40 CZK per share that they have been doing for the last four years. The revenue dropped yet again compared to 2015 and very clearly they have not managed to balance that with decreased costs hence they only brought home 26.7 CZK per share. This is not a good result and they are spending a lot of money on maintenance of their plants and electrical network as well as being forced to write down assets especially in Turkey due to much less than expected profits being generated.


Financial statement for Cez 2016

It should also be stated that they are messing around with their reporting. They have previously reported the "group" and now they are doing a summary of that, see above, while in the IFRS regulated they only report the revenue and earnings for Cez. This means that they have reported all the revenue and earnings as being theirs while in reality they have only received a certain amount of those earnings paid back to them in dividends.

Conclusion: Cez is still not looking good and from my point of view they should not pay out dividends but I suspect that the government would not be pleased if they would not get their 40 CZK per share. I am not very happy with this investment but I will remain as a grumpy shareholder for now.