Foreland - an expensive investment

Though Foreland released a full year revenue +117% and net profit +210% but its dividend rate was only 1.5 RMB cents versus 2.0 RMB cents in 2010.

And in today’s session, its share price ended the day -13.5% or -$0.017 at $0.109.

I bought into Foreland 35 lots last week; and my paper loss is now at $514!

Foreland is actually a good company to invest in so l would probably average down; when its price has stabilized.

>>>

Foreland Fabrictech FY11 Net Profit Soars 210% To RMB140.6m From RMB45.4m

-       Revenue surged 117% year-on-year to RMB756.5 million in FY11, primarily due to improvement in average selling price and increase in sales of higher grade products with better profit margin

-       Average selling price of fabrics rose to RMB13.61 per yard in FY11 from RMB10.57 per yard in FY10 due to improvement in product grades

-       EPS in FY11 surged to 28.65 RMB cents from 10.00 RMB cents in FY10

-       Healthy financial position with cash and cash equivalents of approximately RMB228.1 million and with zero borrowing.

-       Proposing final dividend payout of 1.5 RMB cents per share

-end-

Highest dividend yield - SembCorp Industries?

Before one decided to use up all his money of $5,140 to purchase 1 lot of SembCorp Industries just because it is paying $0.17 cents on dividend, are there any other stocks paying even higher dividend amount or have a higher ROC?

From the table, there are 28 companies ahead of SembCorp Industries which one can consider.  With the same (as a matter of fact, lesser) sum of invested funds of $5,140 on SembCorp Industries, there are stocks paying much bigger dividend amount.

Investors are likely to push SembCorp Industries share price higher tomorrow so, is it really worth it after all?

The 28 companies ahead of SembCorp Industries have their own set of good financial results - profit and loss, balance sheet and cash flow.  Even if some of these companies reported soft full year sales but they will back on their feet and running again in no time i.e. reporting higher sales and profit in the next financial year.  All other things being equal and from the dividend amount and ROC perspectives, these 28 companies are definitely worth considering comparing to SembCorp Industries.

Kingsmen growing from strength to strength

KINGSMEN’S FY2011 NET PROFIT INCREASES TO S$16.3 MILLION

- Revenue increases 11.7% to S$261.0 million
- Net Profit increases 8.4% to S$16.3 million
- Growth driven by strong demand for the Group’s services
- Expects growth to continue
- Proposes final dividend of 2.5 cents per share

“Despite 2011 being a challenging year for the global economy, I am pleased to report that Kingsmen has again withstood the test, continued to grow its business and has emerged stronger than ever before. Our focus on continuously enhancing our capabilities and expanding our footprint has taken on a more urgent tone as we seek to capitalize on the growth opportunities in Asia. To this end, we opened a new office in Shenzhen in 2011, and also upgraded our offices and facilities in Malaysia, Indonesia and South Korea. Even as we move to enhance our capabilities, we are already seeing an expansion of our client base across our territories and are receiving more inquiries for retail store roll–out and fixture exports to Europe and the US.” said Mr Benedict Soh（苏锡波), Executive Chairman of Kingsmen.

Singapore, February 27, 2012 – Kingsmen Creatives Ltd (“Kingsmen”) (“金明创新”) and its subsidiaries (“the Group”), a leading communication design and production group, today announced a strong set of results for the financial year ended 31 December 2011 (“FY11”). Revenue increased 11.7% to S$261.0 million, while net profit increased 8.4% to S$16.3 million in FY11.

The Group’s good performance was driven by strong demand for the Group’s services and higher revenue contribution from the Interiors, Research & Design and the IMC divisions.

Commenting on the Group’s performance, Mr Soh said: “We have done well despite the challenging global environment and have achieved good momentum for growth. We are confident of our growth prospects as we are in the right business and at the right places. As we continue to enhance our capabilities, we are also consciously integrating our services to better address the needs of our international client base. Training and talent development have now taken centre stage in our drive to enhance our value to clients and for us to plan more effectively for the future. We are also overcoming our perennial challenge of talent shortage by recruiting more strategically and across borders. These enhancements to software, coupled with the continuous upgrading and expansion of our facilities around the region put us in good stead to become an effective global player and a partner of choice to our clients.”

The Group’s Exhibitions and Museums division continued to perform well, posting a revenue of S$99.4 million in FY11 despite the absence of any major events, such as the Shanghai World Expo 2010. During the year, the division worked on various exhibitions including Art Stage, Tax Free Asia, SIBOS, BroadcastAsia and CommunicAsia, and supported events for Audi, LVMH and Chanel. The division also completed works for various museums such as the Guangdong Pavilion at the Guangdong Science Centre, Bank Negara Museum in Malaysia and URA Gallery in Singapore. In addition, the division continued to work on several projects for Hong Kong Disneyland, Universal Studios Singapore and Gardens by the Bay in Singapore.

The Interiors division continued to perform well, posting a 24.9% increase in revenue to S$144.1 million in FY11. This was achieved through strong revenue contribution from key customers and brand names such as Abercrombie & Fitch, AIA, Aldo, Burberry, Chanel, Fashion Retail, Fendi, H&M, Hollister, Nuance Watson, Polo Ralph Lauren, Robinson & Co., Tiffany & Co., Uniqlo and Swarovski. Revenue for the division’s fixture export business also doubled in 2011, on the back of strong demand from overseas customers.

The Group’s Research and Design division’s revenue increased 33.3% to S$8.6 million in FY11. This growth in revenue was achieved through a renewed focus to undertake more direct design services, and also to offer design as a supplementary service for design & build jobs. The Group’s IMC division recorded a 27.6% growth in revenue to S$8.9 million in FY11 as the team undertook more events and projects for their key accounts and success in securing new business.


Outlook for FY2012 and beyond

2012 is expected to be another good year for the Group, given its strong market position and the business flow into and outside Asia. As at 25 February 2012, the Group has secured contracts of approximately S$106 million which is expected to be recognized this financial year. 

The Group’s exhibitions division started off the year strongly with the securing and completing of a number of pavilions and exhibition stands for the Singapore Airshow. The division’s client acquisition focus and marketing efforts have also resulted in the division securing jobs for various exhibitions that are taking place in the first half of 2012. These exhibitions include Food and Hotel Asia, Tax Free Asia Pacific and Asia Pacific Maritime. Overseas, the division has also secured several contracts to construct pavilions at the Yeosu Expo 2012 in Korea, and is currently negotiating for a few more. 

On the theme parks and museums front, the division sees strong demand for its expertise. In addition to ongoing works at Hong Kong Disneyland, Gardens by the Bay, and various other museums projects, the division has also recently secured a sizeable contract for Universal Studios Singapore as well as contracts for Hong Kong Maritime Museum and the Sotheby’s Visitor Centre in Hong Kong. The division expects the theme park business to be an area of growth, as it sees more theme parks and attractions being developed in the region and beyond over the next few years. 

The Group’s interiors division is expected to maintain its momentum. On the local retail front, business remains buoyant and the division expects to be involved in upgrading and new projects in suburban malls and along the Orchard road belt.

With global retailers moving to establish themselves in Asia, new opportunities have opened for the interiors division and it expects to serve even more global brands. The division’s fixture roll-out program continues to deliver strong results, with continuing orders from brands globally. 

In line with the Group’s policy of distributing its profits to reward loyal shareholders, the Board is recommending a final dividend of 2.5 cents per ordinary share. Combined with the interim dividend of 1.5 cents declared in August 2011, the Group would have paid out a combined dividend of 4.0 cents per share in FY11.

-end-

Right Reit l Like - 24 Feb

Under March and April months category, MIIF now is a chart topper in both ROC and absolute dividend amount.  MIIF gives a wonderful surprise by declaring higher dividend rate versus same period in 2011.  The top five preference ranking in terms of both ROC and absolute dividend amount have the same stocks components.  My personal preference is on the absolute dividend amount.  Though CapitaRChina has a higher ROC comparing with Frasers Comm but the latter has a $34 more on dividend amount.

Back to MIIF again, l reckon almost all investors are caught off guard by the higher dividend rate.  Its last done price in both this week and previous week stays at $0.585 and hence with $10k, an investor can get the same 17 lots shares.  But if the investor have decided to park his $10k funds with other Reit stock and not with MIIF then it's really a harsh punishment as the latter's higher dividend rate means an additional $213 forgone.

  

previous journal :-  Right Reit l Like - 17 Feb

Cash - Closing Status 24 Feb

Bought Foreland 35 lots, Mun Siong 10 lots, Hock Lian Seng 6 lots.
Sold Serial System 19 lots

Portfolio walk since previous posting :-

$1,147 Total Returns as of 17 Feb 

+$86 Gain on sales of Serial System

+$175 Unrealised positions improved

$1,408 Total Returns as of 24 Feb


previous journal :-   Cash - Closing Status 17 Feb, Investment activities - week ending 24 Feb

LHT double digit increase on revenue and profit

LHT Holdings full year revenue improved by 16.5% but gross profit margin rate stays constant at 26%.

Excluding the $3.07 million investment property revaluation gain, its profit before tax is 55% higher than 2010 which brings about a healthy operating cash flow before working capital.

Current ratio is almost 4.5 times.

LHT Holdings offers value for money as investment.  With just a small investment amount of $112, an investor can get back gross gain of $5 and this means that the ROC is at 4.5%.  No bank and finance companies are able to offer such generous interest income at this low deposit amount. Anyway, this is just an illustration.  To cover brokerage costs for both buy and sell, a retail investor like myself invest a minimal of $1140 for 10 lots then a price spread of $0.006 is required to break even.  The lesser the number of shares, the bigger the price spread in order to break even. 

Its share price is really undervalued as LHT is truly a gem.

Unless its stock gets a push higher from its last done of $0.112 and with only $0.008 away from its 52 weeks high and a cautious current share market, will its share price moves higher this coming Monday?  I reckon that  LHT can easily climb above  its 52 weeks high this coming Monday but strong resistance will set in after that. 

For me, l will not chase up the stock price but am willing to wait for its share price to be lowered  before investing into it.  There is plenty of time till its ex-dividend date in mid May month.  

UE EC delivers dividend 13.3% ROC

UE E&C released its full year results with dividend rate of 6.0 cents (ordinary 2.0 cents + special 4.0 cents).  Its last done price was $0.45 and this dividend gives a ROC of 13.3%!

With the good dividend declared, its price is likely to go up again.  Will it test its 52 weeks high price of $0.51?    The 52 weeks high price was achieved post IPO to stabilise its share price so as to prevent it from going below $0.40.

Looking at its segmental revenue, most of its sales are from Singapore (80%); core gross sales is in Construction (79%) and this segment commands the lowest gross profit margin of 19% but an improvement over 2010 of 13% which was driven by cost saving, lower material prices and improved productivity.  Smallest segment is Building Materials and Equipment (8%) which has highest gross profit margin at 43% versus 48% in 2010 due to higher load testing services cost.  

It did not offer explanation on the increase in Other receivable provision by $3.2 million.

Current ratio is at parity and this is quite dangerous.

Though it has a high ROC but I will not be considering an investment into UE E&C.  

Investment activities - week ending 24 Feb

There is no movement to both CPF and SRS portfolios in this week so am updating Cash portfolio as below.

Serial (S69)

Sold Serial System 19 lots this week; a day before its results announcement.  Nett nett gain at $86.  If this is kept till ex-dividend date then l will get $63 and from past record, the expected dividend payment date is 14 May.  So,  l have actually collected the dividend in advance and at higher amount.  Since 2001, its Revenue CAGR is 26%.  Measuring from year 2006, its semiconductor revenue CAGR is at 22% versus Asia Pacific semiconductor industry CAGR of 7%.  Its gross profit CAGR is at 15% since year 2005.  Though l would prefer a CARG data of the same starting year but these few CAGR info shows good growth track for Serial System. It must however, not losing focus and monitor very closely its increasing inventory and trade receivable turnover days.  l will reinvest into Serial System again at good entry price point.

The share market (local and global) seems overbought at this moment.  But in both bear and bull market, l reckon there are always (both long and short term) opportunities.  So, l did some purchases this week; as below.

Mun Siong MF6) 
Quick financials :- (based on full year results released on 10 Feb) Revenue +6.5%, lower gross profit margin in 2011 due to more complex scope of project work in 2010, current ratio 5.3 times, healthy operating cash flow before working capital changes. 
No. of shares purchased : 10 lots
Dividend rate : 0.6 cents
Ex-dividend date : Not announced yet.  Expected this to be on 27 April.
Plan A : To sell at exit selling price based on the dividend rate and am hoping this to happen within 60 days - which is the time-frame between now till 27 April.
Plan B : If stock price facing resistance between now and 27 April, then to sell it off at break even or at lower exit selling price target for a smaller nett gain.
Plan C : If stock price goes south and holding time frame already past 27 April then to hold for selling it at break even within six months.  Average down if necessary, in order to sell it off at break even.

Foreland (B0I) 
Quick financials :- (based on nine months results released on 14 Nov) Revenue +175%, gross profit margin improved to 29% from 18% in 2010, current ratio 3.5 times, healthy operating cash flow before working capital changes, Foreland issued higher revenue and profit alert on 14 February.
No. of shares purchased : 35 lots
Dividend rate : Not announced yet. Expected it to be higher than previous year 0.379 cents.  In order to form the exit selling price l have assumed and used the dividend rate of 0.51 cents.
Ex-dividend date : Not announced yet.  Expected this to be on 10 May.
Plan A : To sell at exit selling price based on the assumed dividend rate and am hoping this to happen within 74 days - which is the time-frame between now till 10 May.
Plan B : If stock price facing resistance between now and 10 May, then to sell it off at break even or at lower exit selling price target for a smaller nett gain.
Plan C : If stock price goes south and holding time frame already past 10 May then to hold for selling it at break even within six months.  Average down if necessary, in order to sell it off at break even.

HockLianSeng (J2T) 
Quick financials :- (based on full year results released on 22 Feb) Revenue -29% due to the completion of the Marina Bay station project , gross profit margin improved to 25% from 13% in 2010, current ratio 1.5 times, healthy operating cash flow before working capital changes.
No. of shares purchased : 6 lots
Dividend rate : 2 cents
Ex-dividend date : 7 May
Plan A : To sell at exit selling price based on the dividend rate and am hoping this to happen within 71 days - which is the time-frame between now till 7 May.
Plan B : If stock price facing resistance between now and 7 May, then to sell it off at break even or at lower exit selling price target for a smaller nett gain.
Plan C : If stock price goes south and holding time frame already past 7 May then to hold for selling it at break even within six months.  Average down if necessary, in order to sell it off at break even.


previous journal :-   Cash - Closing Status 17 Feb

Tye Soon special dividend continues

Tye Soon reported its full year results this evening.

Its revenue increased by 11.2% to $160.9 million and is unscatched from Japan eartquake in 1H11 and Thailand flood in 2H11.

Total margins increased by $4.3 million in line with improving sales and better gross margin rate.

However, its operating expenses increased by $3.2 million, with staff costs, logistics costs and operating lease expenses accounting for $2.0 million of the increase.

Profit before tax increased significantly by 30.4% from $4.3 million to $5.6 million.

Inventory levels were at 5.9 months as at 31 December 2010 and 6.2 months as at 31 December 2011.  Receivable levels at the corresponding dates were at 2.3 months and 2.2 months respectively.


Cash generated from operations before accounting for changes in working capital reduced from $9.1 million to $8.5 million.


Dividend

year 2011 :- ordinary  0.287 cents + special 4.6 cents
year 2010 :- ordinary 0.225 cents + special 3.45 cents

Special dividend 4.6 cents declared due to its Consumer Business disposal in December 2010.

Tye Soon just completed the disposal of its property in Jurong East on 30 January 2012 so, another round of special dividend when it next announce its full year results around this time in 2013?  Possibility a lower special dividend as it could be building up on its war chest  for business opportunities that may come along.

But then again, l hope l did not interpret wrongly on the special dividend payment timing.  The special dividend of 4.6 cents has actually been recommended for the financial year 2012.  So, it is kind of puzzling.  From past record, payment date is in May month; for the ordinary dividend - so will this includes payment of special dividend as well?  And if it is really meant for financial year 2012 then there would not be another special dividend when it announce its 2012 final results in 2013? 

Serial System fighting on

Serial System announced its results in the wee hours of 23 Feb.

- turnover at S$770.3 million in FY2011, an increase of about 3% when compared with the figure for FY2010.

- gross profit margin at 9.0% in FY2011 as compared to 9.3% in FY2010 due to a more challenging environment in FY2011.

Detailed breakdown given in its results announcement on higher Distribution expenses (increased by about S$6.3 million or 22%) and Administrative expenses (increased by about S$2.5 million or 35%).

- its current ratio is healthy but two key items need serious and urgent attention - Inventory and Trade Receivable

Inventory
- Inventories increased by about S$11.4 million when compared to 31 December 2010 due to higher amounts of inventories held by its subsidiaries for certain product lines in anticipation of higher sales volume for the first quarter of 2012.

- Allowances for inventory obsolescences recorded in the profit and loss of about S$1.6 million (FY2010: Nil)


Trade Receivable
- Trade and other receivables increased by about S$44.5 million when compared to 31 December 2010 due to higher sales and longer average credit period granted to customers. Trade receivable average turnover days increased from 38 days in FY2010 to 55 days in FY2011.

- Finance expenses recorded in the profit and loss increased by about S$1.2 million or 55% mainly due to higher utilisation of trade facilities in line with higher sales for the Group and increased working capital requirement arising from longer average credit period for trade receivables as compared with FY2010.

Dividend

year 2011 $0.33 cents versus year 2010 $0.67 cents


Remarks
I have sold 19 lots on 22 Feb with estimated nett gain of $86.  If kept for dividend, it would have been at $63 and expected payment date is 14 May.

Baker Tech higher revenue not flowing through

Disappointing full year results from Baker Technology today.

Results released for nine months in Nov 2011 was already quite bad but gross profit is still better than previous year, by 15%.  But just one terrible final quarter and its full year gross profit is lowered by 6% versus year 2010.  The bad quarter 4 gross profit margin was due the usual excuse of different product mix and competitive pricing.

Its full year revenue and profitability overview as below.

- revenue increased from S$48.4 million in FY2010 to S$81.1 million in FY2011.
 
- net order book stands at US$80 million, a significant improvement from a net order book of US$33 million a year ago. These orders are expected to be completed within the next 12 to 18 months.

- net profit reduced from S$27.4 million for FY2010 to S$7.6 million for FY2011. The reduction was mainly due to:-

(1) the absence of a share of results from investment in PPLS, from which the Group recorded S$15.8 million in FY2010, as a result of its disposal of PPL Holdings Pte Ltd in October 2010;

(2) a lower gross profit margin for projects in FY2011 as a result of different product mix and competitive pricing;

(3) higher share of losses from its 49% stake in York due to foreign exchange losses resulting from the weakening of the Indian Rupee against the US$

(4) higher administrative expenses of S$3.4 million due mainly to higher legal fees of S$2.8 million incurred in FY2011 in relation to the legal suit with Sembcorp Marine Ltd.

(5) the reduction in net profit was partially offset by a lower foreign exchange loss in the current year. For the year ended 31 December 2011, foreign exchange losses of S$0.9 million versus a loss of S$2.5 million in FY2010, primarily due to the weakening of the US$ against the S$.

Dividend - year 2011 $1.0 cents vs year 2010 $3.0 cents.

GMG attributable earnings up 65.6%

Revenue increased 185% YoY to S$S$1.2 billion in FY2011 from S$418.7 million in FY2010 on higher rubber ASP and volume

Rubber ASP prices rose 12% YoY to S$5,296 per ton in 4Q11 from S$4,729 per ton in 4Q10

Rubber ASP rose 34.5% from S$4,292 per ton in FY2010 to S$5,771 per ton in FY2011

Tonnage sold increased 91.6% from 30,624 mt in 4Q10 to 58,678 mt in 4Q11

Rubber tonnage increased 112.1% from 97,548mt in FY2010 to 206,948mt in FY2011



Gross profit increased 63% from S$104.7 million in FY2010 to S$170.7 million in FY2011

Gross profit margin dipped 11 percentage points to 14.3% due to the significant increase in Group’s tonnage from processing facilities from Teck Bee Hang


Maintains healthy balance sheet with low gearing and net cash position

Group remains positive on the fundamentals and longer term prospects of natural rubber

Soup Restaurant final dividend lowered 65%

-initial post 6.51pm
-added thoughts 10.52pm

Soup Restaurant is declaring lesser dividend payout at $0.175 cents (versus $0.50 cents previously).  Its share price was hammered down by 8.966% (-$0.013) to close at $0.132.  Hey, this reaction should only happen the next day and not today. 

Its full year financials are more or less mirrored that of its half time results announced in August last year.  Same goes for its commentary.  Balance sheet and cashflow are at good levels.  So, there are no surprises of adversely bad results.  As a matter of fact it managed to contain costs (variable expenses, overheads) - for example :-

Purchases and other consumables
- over Revenue :- full year 25%, half time 26%
- y-o-y :- full year 8%, half time 10%

Employee benefits expenses
- over Revenue :- full year 31.7%, half time 31.9%
-y-o-y :- full year 13.6%, half time 15.3%

Other expenses
- over Revenue :- full year 34%, half time 33%
-y-o-y :- full year 19%, half time 21%

The three major expenses categories were all lower y-o-y.

y-o-y,  Profit before tax -37.6% but Operating profit -23.4%

The high costs mentioned in the above already known since half time and it is able to control them to almost same level at full year. 

Dividends on 2010 results :- Interim $0.35 cents + Special $0.65 cents, Final $0.50 cents

Dividends on 2011 results :- Interim $0.35 cents, Final $0.175 cents

Something is fishy here.  I do not mean the shark fins soup which can be easily masked or enhanced with vinegar or pepper.  But the way its share price reacting badly prior to its financial results this evening whereby a lower dividend payout rate was declared.  Overall market, penny stocks are still in play.  There are minor profit taking in some pennies but the timing of its share price drop and its dividend announcement are both too coincidental to be true.  Really hard to believe this.

Bob Farrell investing rules

Bob Farrell’s (Merrill Lynch chief market strategist from 1967-1992) investing rules as below :-

1. Markets tend to return to the mean over time

By “return to the mean,” Farrell reminds investors that when stocks go too far in one direction, they tend to come back to their long-term trend. Overly euphoric or pessimistic markets cloud people’s estimation and judgment of what they can reasonably expect.

2. Excesses in one direction will lead to an opposite excess in the other direction

Markets in a bubble can seem ready to pop, yet they manage to stretch into unrecognizable shapes — and still find buyers. Think of Internet shares a decade ago or real estate before the housing crash. When the bubble bursts, watch out.

Conversely, markets in free-fall typically spring back as if tied to a bungee cord. Think about the sharp bounce U.S. stocks have had since March 2009, when the Standard & Poor’s 500-stock index was about 80% cheaper.

The market’s recent volatility and investors’ uncertainty suggests that stocks are moving into another downswing. “Because we went so much higher [in the rally from March 2009 through April 2011], don’t be surprised if the correction is a little bigger,” said Barry Ritholtz, an investment manager and chief executive of FusionIQ, a quantitative research firm.

3. There are no new eras — excesses are never permanent

This relates to rules No. 1 and No. 2. Many investors latch on to the latest hot sector, and soon a fever builds that “this time it’s different.” It never is, of course. When the sector cools, individual shareholders are usually the last to know and sell at lower prices.

4. Exponential rapidly rising or falling markets usually go further than you think, but they do not correct by going sideways

This is Farrell’s way of saying that a popular sector can stay hot for a long while, but will fall hard when a correction inevitably occurs.

5. The public buys the most at the top and the least at the bottom

The time to buy stocks is when others are fearful and sell when others are complacent. Accordingly, many market technicians use sentiment indicators to gauge investor pessimism or optimism, then recommend that investors do the opposite.

6. Fear and greed are stronger than long-term resolve

Investors can be their own worst enemy, particularly when emotions take hold.

To counter fear and greed, practice self-control. In down markets, keep enough cash on hand so you’re not tempted to sell at fire-sale prices and instead can buy on the cheap. In headier times, prune winners to the range you set for your portfolio’s asset allocation and use the proceeds to buy laggards. This strategy will help you to be proactive instead of reactive.

7. Markets are strongest when they are broad and weakest when they narrow to a handful of blue-chip names

There’s strength in numbers, and broad, powerful market momentum is hard to stop, Farrell observes. Conversely, when money channels into a shallow stream, many attractive companies are overlooked as investors crowd one side of the boat.

That’s what happened with the “Nifty 50” stocks of the early 1970s, when much of the market’s gains came from the 50 biggest U.S. companies. As their price-to-earnings ratios climbed to unsustainable levels, these “one-decision” stocks eventually capsized.

8. Bear markets have three stages — sharp down, reflexive rebound and a drawn-out fundamental downtrend

During the week of August 8, U.S. market volatility reached a level not seen since November 1929. Over four consecutive days of trading the S&P 500 moved at least 4% each day — down 6.7%, up 4.7%, down 4.4% and up 4.6% — finishing the week off 1.7%.

Is this the awakening of a bear market? With Tuesday’s close, the S&P 500 is down 12.5% since its April 29 peak. Not the 20%-plus decline that typically marks a bear, but still a confidence-slashing encounter.

9. When all the experts and forecasts agree — something else is going to happen

Going against the herd as Farrell repeatedly suggests can be quite profitable, especially for patient buyers who can raise cash in frothy markets and reinvest it when sentiment is darkest.

10. Bull markets are more fun than bear markets

No kidding.

Source: Jonathan Burton, MarketWatch, August 17, 2011.

REITs - getting ready for scrip dividend

Name of Tax Change
Liberalising the cash distribution requirement for tax transparency for Real Estate Investment Trusts (“REITs”)

Current Treatment
To enjoy tax transparency, REITs must distribute at least 90% of taxable income in the same financial year in which such income is derived. The distributions to the unit holders must be made fully in cash.

New Treatment
To enhance our tax regime for REITs, a REIT that makes distributions to unit holders in the form of units can continue to enjoy tax transparency. This is subject to the following conditions:

(i) Before the distribution, the trustee of the REIT grants the unit holders the option to receive the distributions either in cash or units in that REIT; and

(ii) On the date of distribution, the trustee of the REIT must have sufficient cash to make the entire distribution fully in cash had no option been given to those unit holders to receive the distribution in units in that REIT.

Unit holders that elect to receive distributions in units will be taxed in the same manner as if they had received the distribution in cash.

This change will take effect for distributions made on or after 1 April 2012.

Right Reit l Like - 17 Feb

Money is always not enough so it must be used to work hardest so as to generate highest returns.  Assuming that l have $10k of funds and my focus is Reit and business trust; and also investment horizon timeline is important - one to two months or less than 6 months. Because of short investment timeline prference, l will not be looking at annual dividend payout rate.

From the table and for Reit with ex-dividend date in the next one to two months, the top five value for money Reits are Frasers Comm, CapitaRetail China, MIIF, First Reit and Suntec Reit.

For longer ex-dividend dates, l would go for Ascendas India, Ascott Reit, K-Reit, Saizen Reit and Sabana Reit as these are expected to generate much higher returns versus popular Reit stocks, as an example on LippoMalls, Cache Logistics, Cambridge Industrial, K-Green, CitySpring and others.

So, this table goes to show that with a available funds of $10k, l can get say, Cambridge 19 lots and its dividend amount of $190 versus say, Sabana Reit 10 lots which generates dividend amount of $304. Both stocks are having ex-dividend dates in May month.  A loyal investor on Cambridge would loose out to a cyclical investor who would have selected Sabana instead.

The ranking will not be static as older ex-dividend dates will become obsolete as newer dates will then be assumed and their re-ranking is required.  As all stocks prices have gone up by a lot in recent weeks then its probably unwise to rush in to buy my favorite counters.  There is "plenty" of time till ex-dividend dates in March and if this is missed, ex-dividend dates in April and future months can be targeted.

If stock prices are lowered (or gone up) then l can buy more (or less)  and this will directly affecting the dividend amount and its yield.  If the overall stock market is in a bull run but not supported by a bullish economy then there is no reason to drool over the high dividend amount and buying into the high dividend yield stock immediately.  Just Do It is not suppose to work this way.

Reit stocks are popular as passive income source but they can be leveraged for an even bigger and better returns.  It is better not be overly sentimental  on certain Reit stocks but be always ready to consider other Reit stocks.  Thinking of only the same and certain Reit stocks are god-send is not a wise decision.  Even research houses do not always have the same stock pick within the same industry (hospitality, industrial, office, retail, etc.).

Cash - Closing Status 17 Feb

For this week under the Cash portfolio :-

Bought SingPost 10 lots, M1 3 lots, STX OSV 3 lots
Sold Starhill Reit 6 lots, Mapletree Industrial 2 lots, STX OSV 3 lots, Nam Lee 11 lots and First Reit 3 lots.

Sold Starhill Reit, Mapletree Industrial and First Reit as these have gone ex-dividend and l can get back the invested funds at break even price; for reinvestment use.  The dividends on these stocks will be in the mail to me on 29 February.

The ex-dividend date on Nam Lee is not known yet so, l am selling all the 11 lots now for a small profit and am hoping to buy into it again at lower price so that it is easier to achieve the exit selling price set.

The strength on STX OSV surprises me as l initially thought that it would Not be able to reach the exit selling price target based on the proposed dividend payout rate which l have worked it out.  This is the risk premium reward for braver investors but for a normal retail investor like myself, it's okay not to pursue it further into uncharted territory. 

Portfolio walk since previous posting :-

$1,198 Total Returns as of 10 Feb 

$175 Gain on sales of Starhill Reit, Mapletree Industrial, STX OSV, Nam Lee, First Reit

-$225 Unrealised positions worsened

$1,147 Total Returns as of 17 Feb

previous posting:- Cash - Closing Status 10 Feb

SRS - Closing Status 17 Feb

Sold SGX 1 lot under SRS portfolio this week.  If SGX price strengthen further in coming days and weeks then l can actually sell on the remaining 1 lot at break even too.



Portfolio walk since previous posting :-

-$1,579 Total Returns as of 10 Feb 

$238 Gain on sales of SGX

-$439 Unrealised positions worsened

-$1,780 Total Returns as of 17 Feb

previous posting :- SRS - Closing Status 10 Feb

CPF - Closing Status 17 Feb

 

Sold Starhill Reit 5 lots this week.  The original intention was to sell Starhill at break even but now l have realised that it has been sold at a loss because l have forgotten to consider the bank transaction fee.  Will have to wait for the bank statement after month end to update the exact loss. 

 

 

previous post CPF - Closing Status 20 Jan

Advance dividend from LippoMalls

I have sold LippoMalls 32 lots on 13 Jan whereby the exit price was the assumed dividend (at $1.11 cents) back then.   LippoMalls announced its full year results this evening, and also made known the dividend payout rate at $0.53 cents.

By doing so, l can plan my exit price and hence it is as good as l have already collected a much higher dividend when l have sold all of it on 13 Jan; otherwise l will have to wait till 16 Mar for the dividend amount (and at a much lower amount).

Random thoughts

Bought STXOSV (MS7) 3 lots this morning as l was attracted by its $0.10 cents dividend; so, average cost is $1.605.  Then l tried working out the exit price at break even but with the dividend payable amount factored in, and it is at $1.715.

I was thinking that this is far too stretched so l have decided to exit at much lower price in the same morning today, at average selling price $1.625.

The overall market is currently kind of overheated.  Where is it heading to in the coming days and weeks?  Thinking of Random Walk Theory now.

I am still trying to sell into strength on some stocks under my cash, srs and cpf portfolios so that l can reinvest the proceeds when the stocks prices are lowered.  But these stocks under my portfolios are still Not at their break even levels yet so, l am hoping that this current bull market to continue.

Apple pie in the face for EpiCentre investors

EpiCentre total revenue almost unchanged at half time (ended 31st December) versus year ago.

Core sales at EpiCentre is Apple products and iPad2 is probably the cause for its gross profit margin to slide by 2% - due to intense competition from its competitors.


Administrative expenses increased by $3m (+44%) due to :-
- EpiCentre outlets increase from 9 to 13 outlets
- headcount increase from 152 to 211 so staff cost jumped 72% (from $3m to $5m) 
- increase in other key operating expenses in line with number of outlets increases

Selling and Distribution costs increased by $0.6m (+23%) due to advertising and promotional activities for the opening of new outlets.

More EpiCentre and EpiLife outlets to be opened in the next 6 months. 

For 6 months results ended 31.12.2010 - (special) dividend rate was $1.0 cents.

For 6 months results ended 31.12.2011 - dividend rate is NIL.


EpiCentre is expanding too fast and it needs to urgently review its operating costs.


For 6 months results ended 30.06.2011 - dividend rate was $2.0 cents + special $2.0 cents.

For 6 months results ending 30.06.2012 - dividend rate is ____?

Sakari scales new heights

Sakari doubles Net Profit

- Full Year Revenue exceeds $1 billion for the first time

- $73.0m Q4’11 NPAT ~ strongest ever for Sakari up 139% (Q4’10: $30.5m)

- $190.3m FY’11 NPAT ~ up 116% (FY’10: $88.2m)

- ASP of $100/t in Q4’11 driven by strong marketing performance

- First coal shipments from Northern Leases transform margins and profits in Q4’11

- 60% of FY’11 Net Profits payable as dividends (proposed final dividend of 5.83 cents brings 2011 total to 10.07 cents per share)

“It's a hard won and very satisfying result for that reason,” said CEO of Sakari Resources Martin Purvis. “It's a result that reflects the substantial effort from every employee in the team to overcome the challenges we faced in 2010 and exceed the far-reaching targets we set at the beginning of 2011.”

“Without wanting to focus on just one area of endeavour within so many positive contributions, it's clear that the performance of the Sebuku team over the past 12 months, in finally realising the latent potential of the Northern Leases project area, has shown enormous dedication and commitment.”

It is Sakari Resources' policy to pay 60% of profit after tax as dividends subject to the Group's capital and other requirements. In line with the policy the Directors have recommended a final tax exempt cash dividend for FY'11 of 5.83 US cents per share (2010: 2.85 US cents per share). Sakari paid an interim dividend for 2011 aggregating 4.24 US cents per share (2010: 1.83 US cents per share). If paid, the proposed final dividend of 5.83 US cents per share (2010: 2.85 US cents per share) will take total dividends paid for FY‟11 to 10.07 US cents per share (2010: 4.68 US cents per share), aggregating $114.17m (2010: $68.07m) which represents 60% of 2011 profit after tax. The dividend, if approved by shareholders at the Annual General Meeting scheduled for 26 April 2012, will be paid on 18 May 2012.

STX OSV the mightiest of them all

STX OSV achieves highest revenue and margins in operating history

- All-time high revenue up 4% year-on-year to NOK 12.4 billion in FY 2011

- Full-year EBITDA up 77% to NOK 2.36 billion with EBITDA margin at a record 19.0%

- Final dividend of SGD 10 cents per share to be recommended for FY 2011

- Improved order wins in 4Q 2011 with order intake of NOK 6.03 billion, including contracts for Petrobras Transportes S.A. (“Transpetro”) worth NOK 3.29 billion

- Order book of 54 vessels at year-end 2011, of which 32 are STX OSV’s own design

Mr Roy Reite, Chief Executive Officer and Executive Director of STX OSV, commented, “Despite ongoing economic headwinds, we have observed robust activity in the deepwater offshore oil and gas exploration and production sector, which we believe will continue to underpin healthy demand for our proprietary designs and vessels.”

Technics Oil skive on dividend

Technics' Q1 FY2012 net earnings increases 31% y-o-y to S$4.2 million but hey! where's the beef?  No dividend declared!

Many are expecting at least a dividend rate of $0.03 and whilst a few other (rating houses) expecting special dividend as well.

Anyway, l have collected my due (the expected dividend) in the week of 13 Jan.

Loyz Energy holding back dividend

Loyz needs to provide more clarity to investors when there are signs that it is not able to achieve profitable results at half time.

Why is there no profit guidance weeks before the half year results announcement?  It prefers to stick to so-called good news :-  (1)January 5th "Loyz Energy inks strategic cooperation deal with GEO EAST, a leading seismic services subsidiary of BGP International and CNPC", (2)November 28th "Loyz Energy to grow concessions portfolio, strengthening name in upstream energy market".

Lower revenue was due to lesser project sales in the sanitary hardware business.  Is Loyz losing focus on its sanitary hardware business?  There seems lacking of spirited fight to make its sanitary hardware business more profitable as it admits pricing competitiveness.

Probably too much time, energy and money being allocated on its new "toy" - the oil and gas business.  There are already so many seasoned players in this oil and gas business so l reckon this is going to be a long haul for Loyz as it will be very difficult to win over prospective customers.       

Previous year dividend was $0.005 but None declared for current financial period.   Reason given "No dividend is announced for this current financial period due to the losses incurred mainly from the oil and gas business. As the oil and gas business is still in the research stage, expenses are incurred to ensure the company having the right technology and expertise for future revenue growth."

Its oil and gas business is still in the research stage so, do expect more related expenses and expenditure be incurred for full year.

IMO, it is better for Loyz to focus more on sanitary hardware business.  Loyz is throwing away all its past glories down the gutter with the oil and gas business.

Bring back Sim Siang Choon!

Sarin sparkling results

Timestamp 10.38pm "blog" : I reckon there is an error in Sarin's "Notice of book closure date for dividend" announced on 13 Feb 10.24pm which stated the final dividend rate at $0.0075 cents whereas both its results announcement and press release mentioned it as $0.01 cents.

Timestamp 11.17pm : Sarin re-announcing "Notice of book closure date for dividend"; dividend rate now corrected to $0.01 cents.


>>>>>

Sarin achieves record performance in FY 2011:

Revenues +27% to US$57.8 million

Net Profit +56% to US$17.4 million

- Robust Q4 2011 year over year growth with revenues up 51% to US$14.1 million and net profit up 271% to US$4.8 million.

- Q4 2011 performance driven by overall positive business sentiment and strong deliveries of GalaxyTM-related and planning systems.

- Thirty-four GalaxyTM related systems delivered in FY2011, with year-end installed base of well over 50; GalaxyTM related revenue over 25% of FY2011 revenue, of which half of recurring nature.

- Final dividend of US1.0 cent declared, bringing full year FY2011 total dividend to US3.25 cents; Dividend yield approximately 5%.

Dividend Policy: The Board of Directors has recommended to increase the dividend policy going forward by 25%, whereby, instead of US cent 1.00 per ordinary share every six months, a fixed dividend of US cents 1.25 per ordinary share will be paid every six months, subject to semi-annual Board approval, the Annual General Meeting‟s approval and subject to business conditions, financial results, other pre-empting uses of funds, statutory and tax issues, etc.

Cash - Closing Status 10 Feb

Cash portfolio positions for week ending 10 Feb as below.

Total Returns increased by $506 (10 Feb $1198 vs 3 Feb $692) or 73% over the previous week.

previous postings :- Cash - Closing Status 3 Feb, Investment activities - week ending 3 Feb,

Investment activities - week ending 10 Feb

Investment activities - week ending 10 Feb

The focus here is the Cash portfolio as l have just updated the investment activity under the SRS portfolio.
Investment activities this week under Cash portfolio as below :-

FSL
Bought 10 lots of FSL this week when the price fell to 0.190 with the intention to averaging down.  But seeing that its road to better dividends days is getting tougher now so, l have decided to moved out my invested funds. The decision to sell away FSL is indeed a hard choice.  This is because l do still have full faith with the Management of FSL.  However, in order to move forward from here, l must not be overly emotional of it.


STX PO

I have finally braved up and sell off Stax Pan Ocean which was purchased back in August 2008.  The stock has gone through Consolidation which turned my 1 lot share into 100 shares.  Weeks after that, the stock price has been going downhill but have been gaining some strength of late. This is because there have been many speculations that it will be bought over soon.  Anyway, time to move on to reinvest the proceeds in other dividend paying companies.

CitySpring

I have this week sold off entire 15 lots of CitySpring after collected its dividends in advance which was derived from the exit selling price worked out. Will consider future reinvestment in it if its price weakens.

Ocean Sky
Original number of shares on Ocean Sky was 22 lots.  Only succeeded sold 20 lots of it at year end 2011 and now selling away the remaining 2 lots this week.  In its last announced results, gross margin is higher due to better mix but almost unchanged for nine months period.  Let's see whether there is a repeat of its Qtr 3 success in its Qtr 4 results probably, end of February month.  It has healthy balance sheet but l am worry of its higher inventory level at the end of the nine months period.  Reason given for this is due to higher level of confirmed orders for the succeeding quarter and l reckon this refers to Qtr 4; let's see.  If it's price weakens, l would consider reinvest in it.

Casa Holdings
I have set the exit selling price on Casa at $0.139.  With its stock price ends at $0.131and having notice its ex-dividend date is 13 Feb and also as overall share market weakens, l have decided to pull out my invested funds of 16 lots in it.  The company has a healthy balance sheet so, l shall revisit it again closer to its next dividend payment date, in next year (2013).

Cache Logistics
I will be getting the dividend from Cache Logistics when the cheque is in the mail on 29 Feb for my 4 lots in it.  Sold off entire 4 lots at break even this week and there is slim chance of reinvestment in it as l reckon other companies can offer higher dividend payout rate.


Sabana Reit
I will be getting the dividend from Sabana Reit  when the cheque is in the mail on 29 Feb for my 2 lots in it.  Sold off entire 2 lots at break even this week and there is a possibility for me to reinvest in it when its price weakens as its payout rate is quite good.

Datapulse Technology
Sold away 7 lots on Datapulse this week.  Its financials are looking good for Qtr 1, which was announced on 13 Dec 2011.  But as its expected ex-dividend date is in November, so pulling out my invested funds for now.

SG Medical
Added 25 lots in SG Medical this week but upon reviewing its financials further, it seems that they are not so outstanding.  So, l have sold off entire 41 lots in it.    There is also a private funds (Kendall Court) investing considerably in SG Medical for its eyes surgery centres in China.  Though its financials are not so outstanding but considering an anticipated higher dividends, l would consider reinvestment in it if its price weakens before its yet to be announced but assumed ex-dividend date in mid April.     


previous postings :- Cash - Closing Status 3 Feb, Investment activities - week ending 3 Feb

SRS - Closing Status 10 Feb

 Sold FSL 5 lots under SRS portfolio this week.


 Portfolio walk since previous posting :-

-$3,197 Total Returns as of 20 Jan 

-$606 Loss on sales of FSL

$2,223 Improvement in Unrealised positions

-$1,579 Total Returns as of 10 Feb

FSL
The decision to sell away FSL is indeed a hard choice.  This is because l do still have full faith with the Management of FSL.  However, in order to move forward from here, l must not be overly emotional of it.



previous posting :- SRS - Closing Status 20 Jan

Advance dividend from CitySpring

I have yesterday sold off entire 15 lots of CitySpring.  I have assumed the dividend to be announced is at 0.82 cents.  At 15 lots, the expected dividend amount is $123.00.  But l have managed to offload it at slightly better price to arrive at nett gain of $162.33.  Today, CitySpring announced the dividend payout rate is at 0.82 cents and the dividend is payable on 2 March.

The stock price on CitySpring (and other stocks)  is likely to test new highs but l reckon there's no ends to one's greed.

Almost everyone are in panic buying mode but l still continuing carrying out my exit selling price on stocks, calmly.  For me, planned buying price and setting an exit selling price is a lot more meaningful, and having the ability to achieve inner peace too.

Generous dividends from Vicom

Vicom released its full year results today.

Revenue was $6.8 million or 8.1% more than the year before due mainly to higher revenue from vehicle inspection and test & inspection services.

Operating profit increased by $3.1 million or 11.5% to $30.0 million.

Balance sheet and cash flow are healthy.

Ordinary dividend 7.5 cents and special dividend of 3.2 cents declared.

Old Chang Kee healthy results but No dividend

Old Chang Kee released its results today.

Revenue increased S$2.4 million or 8.1% for the 6 months period from 1 July 2010 to 31 December 2010

Gross profit increased S$1.4 million or 7.7% but gross profit margin decreased slightly from 60.3% in 2H2010 to 60.1% in 2H2011.

Healthy balance sheet

But NO dividend payment based on year 2011 results!!!

In 2010, payout rate was 1.0 cents (ordinary) + 0.5 cents (special)

STXPO finally gone

I have finally braved up and sell off Stax Pan Ocean which was purchased back in August 2008.

The stock has gone through Consolidation which turned my 1 lot share into 100 shares.  Weeks after that and now, the stock price has been going downhill but have been gaining some strength of late. 

Estimated loss on this 100 shares disposal is at $1.9k!!!

The share price will test new highs but that's not my cup of tea - speculative trading.

BH Global first and final dividend 0.7 cents

BH Global Marine announced its results today.

Invested 10 lots in it last week and l have targeted my exit selling price at its unannounced dividend payout rate of 0.7 cents back then.  In the same week itself l have sold it off as it has hit my exit selling price.  So, l have actually already collected its first and final cash dividend payout of 0.7 cents.   The actual dividend payable date is not yet determined at the moment but l expect it to go ex-dividend in early April.

Of course its stock price has gone higher since last week but then that's not my main objective as l am really going after dividends and so l have set the exit selling price.

I have now free up the invested funds in BH Global so, l can now set my next target company for advance dividend payment. 
  

>>>

BH Global Marine ends year in good shape with net earnings of S$12.9 million in FY2011

• New business segment, Engineering Services pushed up revenue and gross profit by 39% and 17% to S$143.4 million and S$39.1 million respectively

• Recommend first and final cash dividend payout of 0.7 Singapore cents per ordinary share, representing dividend payout ratio of 28.2%

• To tap into pockets of demand in Indonesia and Middle East through expanded portfolio offerings

>>>


previous posting :- Investment activities - week ending 3 Feb

FSL Trust

FSL stock price is off around $0.009 as of now.  Which is due to default in payment by one of its major customer.  I think FSL is taking swift action to mitigate the problem and l am confident it is able to find good resolution to the three tankers recovered.  But investors still react negatively.  

The earlier price drop was due to its reduced dividend payout rate from anticipated $0.01 to $0.0001.  This is to ensure it is able to maintain good cash position to meet its debts obligation.  I think it is a very wise and prudent action to take by reducing the payout rate but the reduced quantum is just too much for investors.

l have full confident with the FSL management to ride out the storm but then again I am just a normal retail investor so these price drops is really very heart breaking.

Though l have holding power on FSL but have decided to move my funds into other good dividend paying stocks.

l have sold off my position in FSL today and have recorded my first (huge) loss of around $1.4k since tracking my investment starting from Jan 2011 under the Cash portfolio.