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  "docSlug": "ad39e81239e4",
  "documentTitle": "Olam International Ltd. (SGX:O32)",
  "authorId": "51_Muddy_Waters",
  "authorName": "Carson Block",
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  "presentationDate": "2012-11-27 00:00:00",
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  "notes": "The slide uses a table to demonstrate that while EEGs are a small percentage of revenue, they represent a significant portion of net profit, challenging the company's public narrative.",
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      "text": "The effect of EEGs on the bottom line is very important because, like any trading company, Olam generates substantial amounts of revenue with very low margins.",
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      "text": "EEGs as a proportion of PAT: 43%",
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      "text": "As we can see from the table above, the incentives are equivalent to a disproportionately large amount of Olam's PAT. The effect on earnings is much higher when considering total government grants. This raises questions over Olam's dependence on these handouts.",
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      "text": "Olam was quick to point out that the EEGs constituted 0.7%, 1.0% and 0.8% of total revenue in the financial years 2008, 2009 and 2010 respectively. Olam wanted to obfuscate the issue by making the market believe that because the EEGs are an insignificant proportion of revenue, then their absence would have little effect on Olam's profitability. However, the effect of EEGs on the bottom line is very important because, like any trading company, Olam generates substantial amounts of revenue with very low margins. The most important figure for trading companies is the bottom line.",
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      "text": "1 EEG figures per Olam's response to CLSA report",
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      "text": "Olam's Government Handouts table showing PAT, Export incentives, Grant income, and EEG proportions from 2008-2012.",
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      "text": "EEG Effect on Profitability",
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