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Sunday, 24 June 2012

Best World's passion to perform

Best World's (BW) reported lower full year financials on 27 Feb but it seems to continue putting up fierce fight to improve the negative situations when 1Q12 results was released on 14 May

Revenue :- 1Q12 +0.2%, 4Q11 -25.0% (mainly due to flood situation in Thailand)

Gross profit margin :- 1Q12 78.3%, 4Q11 77.9%

Profit/Loss before tax:- 1Q12 +8.9%, 4Q11 -51.6%

Current ratio :- 1Q12 6.3, 4Q11 6.3

Quick ratio :-   1Q12 5.6, 4Q11 5.6

Lower Inventory :- 1Q12 vs 4Q11 -10%, (1Q12 208 days, 4Q11 214 days)

Borrowings :- Nil (in both 1Q12 and 4Q11)

Net Cash Flows from Operating Activities :- 1Q12 vs 1Q11 +19%, 4Q11 vs 4Q10 -44%

EPS :- 1Q12 +17.2%, 4Q11 -31.5%

NAV :- 1Q12 23.05cents, 4Q11 23.63cents

Last done Stock price (@ 22 June) :- 17.5cents, 52 weeks H/L 20.5cents/13.5cents

According to BW, sales in Singapore is weak because 1st quarter (-7.7% yoy) being usually the weakest quarter due to seasonal and CNY festive.  Not sure how true is this?  Consumers profiles in both Singapore and Malaysia should be the same and Malaysia is able to register sales growth (+12.7% yoy).  Anyways, Malaysia seems to be BW sales growth focus in future quarters.   In Indonesia, Thailand and Taiwan, BW is facing double digit de-growth.

2Q12 would let us know whether BW is successful to stay the course on maintaining or improving its market share over competitors.  But if there is a repeat Thailand flood in 3Q12 then this could negatively impact BW badly.

In 2Q11, BW reduced dividends by 50% from 1.6cents to 0.6cents.  Keeping its dividends at 0.6cents will be a nice thing to do when 2Q12 results is expected to be announced in Aug'12 so, till then.

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