For the transition period between
Jan-Apr’14, a net loss of US$42.8m was incurred, reversing profit of US$6.6 Million,
mainly due to one-offs relating to the purchase of Del Monte Foods which was
completed on 18 Feb’14. Excluding US$46.7 Million non-recurring items, adjusted profit
would have been US$3.8 Million.
Consolidated revenue grew three-fold to US$379.2 Million, of which
US$292 Million was contributed by Del Monte Foods (DMF). Zooming in to Asia Pacific
operations, revenue fell 24.2% on weaker Philippines sales, offset by strong
S&W sales.
Gearing has increased from 67.2% to a hefty 746.3%. In a
note by MKE last year, management indicated that the near term focus will be on
paring down debt, as such payout will likely be 33% instead of 75% in previous
years.
Management expects to generate higher recurring earnings in
FY15 as it drives sales and optimizes synergies.
My Opinion
- It is time for the group to reduce the debt level, hence the dividends to shareholders would be reduced for several years
- We have not seen the synergies yet after the acquisition, it may take some time for the group to further consolidate the operation efforts in order to increase gross profit margin as well as the net profit margin
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