15 September 2014

Vibrant 2015Q1 Result Summary - September 2014

Company Background

Vibrant is a holding company that mainly focus on logistic business with 3 other interrelated division - Finance Service, Property Development and Property Management. It is also the main sponsor of Sabana REIT, the first Shariah Compliance REIT listed in Singapore. 

Since listed in SGX, the dividend payment increased every year. The latest full year dividend was 0.55 cents or about 5% dividend yield based on current dividend yield. 

Company Performance Review

The company registered an increase of 8% of revenue to S$51M, net profit increased by 90% to S$6.8M (net profit margin was 13%) due mainly from lower fair value loss on quoted equity securities as compared to previous corresponding period.

The Group’s share of profits from associates decreased by 65.1% to $734,000 from the previous corresponding period due to lower contribution from China Southwest Energy Corporation Ltd. Consequently, the Group achieved a profit after tax and non-controlling interest of $6.8 million for 1Q2015, up 89.9% from $3.6 million in 1Q2014.

As at 31 July 2014, the Group has cash and cash equivalents of $41.8 million, and net gearing of 0.81 times.

The annualized EPS was 1.08 cents with NAV of S$0.1454, which translated to annualized ROE of about 5% - 10%. With annualized PE Of about 10X, I think the price is fairly valued. It is suitable for those investors who prefer a good and steady dividend yield play stock as so far the dividend payment is increased steadily over the years. 

Company Outlook Comment

On 20 August 2014, the Group completed the 35% acquisition of the Equity Plaza at 20 Cecil Street, Singapore 049705. Cecil House will undergo upgrading and retrofitting work to maximize the gross floor area. The redevelopment of the 6-storey ramp-up chemical warehouse at Gul Circle is expected to be completed in 2016.

The business outlook continues to be challenging with uncertainties in global and regional economic and geopolitical concerns. The Group will continue to strengthen and expand its businesses and portfolio whenever opportunities arise.

Popular 2015Q1 Result Summary - September 2014

Popular holdings reported a decent quarterly report this month. The revenue increase 6% to S$141 Million compared to corresponding period last year, with Profit attributable to owners of the company increased to 77% to S$9.4 Million from S$5.3 Million last year. The improvement is mainly due to the higher turnover achieved by the Retail and Distribution and Publishing and e-Learning Divisions offset by no revenue from property division. 

The net profit margin was improved to 7% from 4% previous corresponding quarter, with annualized PE 5.19X and annualized PB 0.86X, I think it will gain more public awareness from investors once the net profit margin can be improved again. 

With annualized ROE of about 15% - 20%, I believe it is a good company, but I think the consistency to maintain a good profit and business stream remains the main factor to allow the share price to appreciate in long run. Just to note that, the total debt to total asset ratio remains high at this moment. 

With current property market remains soft, I believe that the property division may not be the main driver for next 1 - 2 years. 

Company Comment on Outlook

The Group remains cautious of unexpected economic upheavals in the global economy which may adversely affect consumer sentiment and the continuing regulation of the property sector. Inflationary cost pressure on manpower and rental may not ease in the immediate term. The Group will continue to improve operational efficiency so as to negate the adverse effect of inflationary cost pressure. Being in a strong financial position, the Group is confident of weathering the uncertainties.

10 September 2014

Neo Group 1H15 Result Summary - September 2014

Neo Group reported an increase of 21% in first half year 2015 revenue compared to corresponding period last year, despite the drop of net profit of 9.1% compared to the same period last year (Net profit margin dropped to 9% from 12%). The main reasons due mainly to increase in depreciation expenses, advertising expenses for restaurant related businesses as well as operating lease expenses due to the expansion of the business operation.

According to the group, they are in transition to double up their capacity in operation. The new centralized kitchen is targeted to be completed by October 2014 which I believe it will improve the gross profit margin as well as net profit margin in second half year 2015 result. I am quite surprised that the group also engage in online florist business although it is somewhat indirectly linked to existing catering business.

01 September 2014

Dukang FY14 Result Summary - September 2014

Dukang released its unaudited fully year 2014 report. The sales dropped by 40% to RMB 1,451 Million from RMB 2,406 Million a year ago. Net Profit dropped by 89% to RMB 44 Million from RMB 390 Million a year ago. It is mainly due to the decrease in gross profit margin to 36% from 41% previous year as well as the decrease in revenue. The company highlighted that decrease in revenue from both Luoyang Dukang and Siwu operations, as a result of China’s current austerity measures on luxury gifts and spending

Balance Sheet wise, Dukang registered an increase of almost 100% in inventory level to RMB 689 Million from RMB 343 Million, mainly due to the bulk purchase of good quality grain alcohol at a competitive price. The Cash level dropped to RMB 392 Million from RMB 758 Million a year ago. Nonetheless, the group maintain a healthy debt level by having total liabilities to total asset ratio of around 21%. The total equity to shareholders increased by about 2% RMB 1,999 Million. 
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