Sunday 1 November 2015

Eniro report Q3 2015

Eniro, Q3, 2015, front page

My Swedish mistake Eniro arrived with their Q3 report for 2015. The market response was good and the share price increased with double digits (in percentage that is). They have still not gone belly up and I have still not sold my shares so the story continues.

Here is the report in full and for my previous summary please visit Eniro report Q2 2015 or why not take a look at analysis of Eniro 2015.

Below you can see the financial statement for Eniro and as I mentioned the market response was very strong because Eniro had a net earnings of 38 million SEK for the quarter. This should however be placed into a bigger picture that says that they have to pay out 48 million SEK per year for the preferred shares, they have large costs due to their debt even though they have significantly decreased that in the last year.  Oh, and we should also not forget that ALL their sales are decreasing even the mobile which was their pride and joy not that long ago. Another thing that one should NOT forget is that Eniro is still sitting on 3.7 billion intangible assets so... well... that is most likely as far as the write downs could go.

Eniro, Q3, 2015, financial statement

The new CEO is coming from the Danish unit and I found it interesting that he was complaining about that the Danish section had performed worse than expected. I almost got the feeling that this guy is a tough cookie and maybe it could be that employees fear him and work slightly harder out of fear. So once he left Denmark... they got more relaxed and the results dropped? Only speculations but if it is correct then I must probably agree with the board that he is the right guy to bring Eniro back on its feet. Ok, putting fear in employees are not good but he will most likely not fear to cut off also a little bit of meat to make sure that all the fat is gone.

Conclusion: Eniro is not by far out of the woods. I find it amazing that the market celebrated this report because there is still nothing that shows that the knife fall has stopped yet and yes... the analysts might have made lower estimates than what came out but how do you value a company with no tangible assets and not being far away from bankruptcy? Should the value be much more than zero SEK? I do not know. I will remain a grumpy shareholder still hoping to see that turn around in the course of my lifetime.

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