All good points Barooona, but I'd suggest studying the whole...

All good points Barooona, but I'd suggest studying the whole Balance Sheet for a more complete picture.

For clarity I’ll only list the big ticket items here :

Assets – up by $60m being :
Cash up by $28m, Trade Receivables up by $32m

Liabilities – up by $29m being :
Trade Payable down by $23m, Interest Bearing Loans up by $52m

Net Assets (Equity) up by $31m for the year


Most of that huge $600m increase in revenue is from Liven’s trading, which helpfully commenced right on 1 July 2022, the start of the 2023 financial year. It's reasonable to assume that the big changes in the Balance Sheet are due to Liven as well.

What's interesting is that during this period of stellar growth, the year end trade payables due are lower than the previous year ! Cash has been applied to pay down the balances and is part of the reason why reported operating cashflow is lower than accounting profit. On the flip side, interest bearing debt jumped - what has happened?

The funding model of Liven is different to that of Kemoil. Kemoil 2022 funded much of its extended credit by delaying its own payment. Liven 2023 doesn't have this luxury. We pay upfront when the trade is made in Singapore. We then fund the extended credit we provide to our customers by a rolling short term debt facility. That is why interest bearing debt jumped by $52m, and its why our 2023 interest cost jumped from $1m to $4m.

$52m is a lot of money but is the increase reasonable in relation to growth. Well on extra annual sales of $600m, extra debt of $52m roughly funds a constant rolling month of extended credit. That doesn’t seem excessive to me.By that same calc, an extra $50m or so in cash from the sale of Cheekah-Kemayan is a way for CII to fund a further $600m of sales growth - without increasing debt. The board sees the opportunity IMO and that's the main reason this new transaction going through. I've been wrong before so DYOR