HERE, Here Group Limited

Will it survive?

• Can it pay its interest? —
  No meaningful interest burden
  Little or no interest expense reported
  What this means

  Little or no interest expense reported, the business isn't leaning on lenders to operate.

• How heavy is the debt, net of cash? +CN¥1.0B
  Net cash, debt-free
  Cash CN¥830M + ST investments CN¥190M − debt CN¥0
  What this means

  Cash and short-term investments exceed every dollar of debt by CN¥1.0B, on net the company owes nothing, and can act from strength when others can't. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.

• How long is cash tied up? 164d
  Long (60+ days)
  DSO 183 + DIO 16 − DPO 35 days
  What this means

  Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

• Return on invested capital —
  Not enough data
  Industry peers: median 8%
  What this means

  The filing data didn't include the inputs for this check.

• Owner-earnings margin 9%
  Solid through the cycle
  5-yr median margin, range 4%–198%; latest CN¥181M = operating cash CN¥184M − maintenance capex CN¥3M
  Industry peers: median 1%
  What this means

  What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 198% of revenue this year, a 9% median across 5 years.

• Are earnings backed by cash? 0.52×
  Thinly cash-backed
  Cash from ops CN¥184M ÷ net income CN¥357M

  In the filing’s words The filing discloses a material weakness in its financial controls — the reported numbers here, and the record built on them, are only as reliable as the controls that produced them.

  What this means

  How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

• Where do the earnings go? 43%
  Returns about half
  Dividends + buybacks CN¥78M ÷ Owner Earnings CN¥181M
  What this means

  Of CN¥181M Owner Earnings, CN¥78M (43%) went back to shareholders, CN¥78M dividends, CN¥0 buybacks. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.

• Investing or harvesting? 0.56×
  Harvesting
  Capex CN¥3M ÷ depreciation CN¥6M
  What this means

  Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 1 of 3 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

• Adequate size —
  Revenue ≥ $2B (a dollar floor) · CN¥91M
  What this means

  Big enough to weather a storm. Graham's floor is a dollar figure — about $2B of revenue as a conservative modern stand-in. This company reports in its home currency and we carry no exchange rate, so we show the figure and leave the size bar for you to apply rather than convert it with a number we don't have.

• Strong liquidity Pass
  Current ratio ≥ 2× · 2.14×
  What this means

  Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.

• Earnings stability Miss
  A profit every year (5-yr record) · 3 loss years
  What this means

  Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.

• Dividend record Miss
  Uninterrupted dividends · 1 of 5 yrs
  What this means

  An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.

• Moderate price —
  P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price
  What this means

  Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are CN¥1.28/share (latest year CN¥2.16), the averaged base the calculator's gate runs on, and book value is CN¥4.90/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2021–2025

Whether the record’s returns held, and what the capital reinvested earned.

• Profitable years 2 of 5
  What this means

  Lost money in 3 year(s), look at what happened there before trusting the average.

• Operating margin −13% → 334% (2-yr avg ends)
  What this means

  Through the cycle the operating margin widened — about −13% early to 334% lately, median −4% — pricing power intact or improving.

• Owner earnings growth +8%/yr
  What this means

  Owner earnings grew about 8% a year over the record.

• Worst year 2021 · −18.8% op. margin
  What this means

  Operations went underwater in 2021, understand why before trusting the good years.

• Dividend record paid
  What this means

  Paid a dividend in 1 of the years on record.