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  "documentTitle": "Stroer SE & Co. KGaA (SAX)",
  "authorId": "51_Muddy_Waters",
  "authorName": "Carson C. Block",
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  "presentationDate": "2016-04-28 00:00:00",
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  "notes": "This is a text-heavy research note page focusing on forensic accounting and reconciliation of organic growth metrics.",
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      "text": "It appears to us that Ströer’s organic growth claims have no basis in reality.",
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      "text": "organic growth: 8.7%",
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      "text": "The analyst only made one material error in attempting to reconcile 2015 organic growth, and it was a repeat of one of the 2014 errors. He did not add 2014 pre-acquisition revenue of €8.8 million to the 2014 comparable revenue base. Making that addition would have lowered his organic growth calculation to 8.53%, versus Ströer’s claimed 9.8%. (Note that our methodology of subtracting the €3.0 million FX adjustment from the 2014 revenue base would be favorable to Ströer by three basis points.)",
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      "text": "It’s a small point, but the “2014 comparable revenues” should be reduced by €2.4 million to account for revenue contributed by acquisitions made in 2014. The analyst table above is a little confusing, but to get to 2014 comparable revenue, we start with reported 2014 revenue of €721.2 million. We then add back the IFRS 2014 adjustment of €12.5 million. Then we subtract the aforementioned €2.4 million to reach 2014 comparable revenue of €731.3 million.",
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      "text": "Dropping the corrected numbers and formula into the above table yields 2014 organic growth of only 8.7% (2014 comparable revenues of €731.3 / 2013 comparable base of €672.6 million - 1). Ströer claims to have generated organic growth in 2014 11.4%, which is a number that we continue to believe has no basis in reality.",
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      "text": "It appears to us that Ströer’s organic growth claims have no basis in reality.",
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      "text": "acquisition revenue (albeit the number would be wrong). The line “Plus Organic” of €72 million seems to be a formula that is attempting to bridge the gap from the understated 2013 comparable base to reported 2014 revenue.",
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      "text": "11 The “Plus Organic” line €74.9 million also appears to be a formula attempting to bridge the gap from the understated 2014 comparable base to reported 2015 revenue.",
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