Just for fun’s sake, I thought I’d take a look at GNG (Geong International), which I hadn’t looked at for a very long time. “Geong International Ltd (GEONG) is a Jersey-based company, providing Internet software solutions for companies in China.”
Sure enough, it’s down 50% over a year period. It now has a market cap of just £1.5m. It used to be higher, but I dare say has now disappeared off most people’s radar. I seem to recall that it was favoured at one point by a highly respected investor; someone whose calibre as an investor is far above mine.
Still, a Chinese AIM company is a Chinese AIM company, and a 50% loss is what you get if you invest in them. Unless you invested in it for 5 years, then you would have lost 91%. I saw it issued an AGM statement on 20 October 2014, and LSE reported the headline “GEONG International Expects Half Year In Line, More Contract Wins Soon”. I do not consider that bullish, but mere rhetoric.
Their RNS states: “We have previously stated our intent to monitor trade receivables carefully and with a focus on increasing collection. Steady progress has been made with this”. I remember them saying that when I last looked at them. Nothwistanding what they say, receivables are still more than two times their revenues. In the opinion of the auditors there is “material uncertainty regarding the recoverability of the accrued income amount”.
Avoid.
3.92p ASX 3503
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