28 August 2014

Civmec FY2014 Report Summary - August 2014

 Income Statement
GPM = 14,65%, NPM = 8.09%

Balance Sheet

Cash Flow, EPS, NAV, DPS, ROE, PE, PB, DY

Review and Outlook

My Notes

Civmec registered deteriorated ROE of 20 - 25% compared to previous year. It is mainly due to the fact that the gross profit margin and net profit margin was lower due mainly to changes in project/product mix. Considering this is a company with good ROE, I believe the current PE ratio of around 10X is justifiable. As this is a project-based company, it may record volatile revenue in good times / bad times. The outlook given by the management is that they are cautiously optimistic on next six months ending 31 December 2014 (1HFY2015).

The dividend yield is near to 1%, still not too bad compared to saving rate in Singapore local banks. As the free cash flow is negative still, I believe the company will not adjust their current dividend policy until further business progress.

Do note that this is a highly leveraged company, and it relies on non-current assets (PPE) to generate revenue and cash flow.

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