From the article, the author applies the accounting numbers and financial ratios (i.e. dupont ROE) to interpret the accounting datas from the annual reports of furniture-related companies, eg. Homeritz, Hevea, etc. so as to tell stories and analyse the business operations.
Bear in mind, the accounting is the language of business, so what are you still waiting for?
To those, who wanna learn it, you may refer to the link provided here: http://klse.i3investor.com/blogs/JTYeo/96888.jsp
Extract:
"These are the fixed assets extracted from the reports. When you look at plant, machineries & equipments (PPE), Hevea needs around RM170 mil of PPE to generate RM503 mil of revenue, or 2.95x. In contrast, Homeritz can generate RM146 mil of revenue with only RM4 mil worth of PPE. That's 32.95x.
Is that because Hevea is inferior? No, it is simply because they are in a different business. For a particleboard manufacturer like Hevea, the amount of machineries they need to chip, flake, dry, mat forming, hot pressing, sanding, sizing, laminating, to turn timber into particleboard are a lot.
In comparison, the machineries you need to turn particleboard into an upholstered sofa is very little. Sanding, polishing and some cutting tools should do the work. In saying that, the workmanship needed to turn the sofa into a high-end quality product will translate into higher expenses too. Pohuat & Latitude would have more similiarities to Homeritz than Hevea, while Hevea's business is more similar to Mieco."
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