Clownbuck,
XIN is in a cash-intensive business -- cash is required to bid for lots from the government. Also, some of the debt (and there is one particularly high interest debt that rolls off in one year) was taken when they thought they'd need the further money to expand but decided to hold back. That particular debt is hard to justify, but overall the debt seems reasonable to me. And of course the company has done better than expected and generated a lot of cash recently.
The $425M revenue is 6-month, not quarterly revenue, quarterly is $253M in revenue, some of which I attribute to a growth sales in Q2 as China lowered its borrowing rates and there was a pick-up in sales countrywide.
They have spent $10 million on a buyback, plus significant money on dividends, and have just started another $20 money on buyback, which will restart in 3 days. It doesn't make sense for me for a total fraud to be spending so much money on its shareholders. Their auditor is Ernst & Young, and they have beefed up their cash verfication procedures given the recent spectacular files such as Longtop, but nothing over there is certain ...
MC |
