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Friday, 20 February 2015

Stock changes 18 Feb

Latest stock holdings :-

UOB Bank
Invested into UOB Bank 100 shares under Cash stock holdings.  For its Qtr 4 results, total operating income +6.2% YAGO.  Net Interest income +6.7% YAGO, +1.1% QOQ mainly due to strong loan growth.  Non-interest income +5.4% YAGO driven by strong fee Income and improved trading and investment income from favourable market sentiment; but -16.4% QOQ due to seasonal slowdown in business volume and higher hedging gains in 3Q14 on the back of favourable market conditions. Staff costs flat for QOQ.  Higher opex due to higher revenue and IT related expenses to support its growing franchise and increased business volume.  Impairment charges rose by 19.9% due mainly to a few isolated non-performing accounts in Thailand and Indonesia as well as collective impairment set aside for loan growth.  Biggest segment, Group Wholesale Banking profit grew 5.3% driven by net interest income and increased cross-sell income from transaction banking and treasury products. The growth was partly negated by higher impairment charges and higher operating expenses. Higher operating expenses were resulted from the continued investment in product capabilities and hiring of new talents as the business expanded regionally.

Reduced Starhub 9000 shares under SRS stock holdings for $13 net realized profit in order to re-use its proceeds for re-investment into other stocks.  Remaining stock holding in it now at 4000 shares (Cash 1000 shares, SRS 3000 shares).  For its Qtr 3 results, revenue +2.3%, profit +2.6%.  Higher revenue mainly driven by higher sales of equipment.  Higher profits contributed by higher revenue and other income, offset by higher operating expenses.  It will maintain annual cash dividend payout of 20 cents per ordinary share for 2014 so $0.05 will be declared when it announce full year results on 25 Feb.

SIA Engineering
Reduced SIA Engineering by 2900 shares under Cash stock holdings for $105 net realized profit in order to re-use its proceeds for re-investment into other stocks.   For its Qtr 3 results, Revenue -6.5% due to lower airframe and component overhaul revenue as work content was lower with fewer heavy checks; which was offset slightly by increased revenue from fleet management and line maintenance. Strong and healthy Balance Sheet.  Profit -24.1% mainly from lower share of profits in associated and joint venture companies; because of reduction in engine shop visits due to the retirement of older engines, as well as engine improvement modifications and longer engine “on-wing” life of certain aircraft models , lower contributions from the engine repair and overhaul centers.  The operating environment remains challenging. Heavy maintenance business though stabilizing, engine shop visits will continue to decline.  Because intense competition and increasing business costs, the pressure on margins will remain.

Lum Chang Holdings
Increased Lum Chang Holdings 7200 shares under Cash stock holdings so total stock holdings in it now at 14200 shares.   On its Qtr 2 results, revenue -20%, profit +62%.  Lower revenue was recognized from two construction projects as the projects were substantially completed in June 2014. Current Price/Book value at 0.71.  It recently disposed off its Kensington investment property at SGD 11.4 mil net gain; to be included in its Qtr 3 results; proceeds will be used to fund future investments of the company and its subsidiaries.  It will commence work as the main contractor for Northpoint City in Nee Soon in April'15; and expected to be completed in the 2nd half of 2018.  This latest contract brings the total outstanding value of construction projects still in progress to approximately SGD 1 billion.

Bund Center Investment
Added Bund Center Investment 3000 shares under Cash stock holdings so there are 5000 shares in total now.  For its Qtr 3 results, revenue +4.2%, profit +0.1%.  Better revenue due to higher leasing income from the Bund Center office tower and improved average occupancy rate in hotel segment. Higher leasing income driven by improvement in average leasing rate in office tower segment, as well as higher average rent rate.  Better hotel revenue due to higher average occupancy and average room rate which is higher than the average occupancy rate and average room rate achieved by five-star hotels in Shanghai.  Flat profit due to net foreign exchange loss in current quarter comparing to net foreign exchange gain in previous year.

Hai Leck Holdings
Reduced Hai Leck Holdings 4000 shares under Cash stock holdings for $81 net realized profit; so remaining balance status in it now at 2000 shares.  For its Qtr 2 results, revenue -22.0%, profit -64.7%.  Major customers are reducing its capital expenditure, thus Hai Leck as a service provider is affected. The plunge in oil prices impacted the down-stream in the oil and gas industries negatively. Competition continues to be intense and is expected to exert pressure on the profit margins.

Divested away Hupsteel 19000 shares under Cash stock holdings for $18 net realized profit in order to re-use its proceeds for re-investment into other stocks.  On its Qtr 2 results, revenue -23%, profit -55%.  Lower revenue due to weak demand for steel products as business activities declined during the year end festive holidays and fewer project orders were received. During the global financial crisis it dropped dividend rate from $0.035 to $0.01; and having been consistently declaring $0.01 dividend rate since calendar year 2009 till now (except for calendar year 2011, dividend rate $0.015).   Also, the last rights issue was in calendar year 2007.

DBS Bank
Invested into DBS Bank 600 shares under both Cash (100 shares) and SRS (500 shares) stock holdings.   For its Qtr 4 results, total operating income +9% YAGO, -7% QOQ.  Net Interest income +15% YAGO, +4% QOQ from higher loan volumes and improved net interest margin.  Non-interest income -4% YAGO, -27% QOQ mainly because trading income fell from less favourable trading conditions. Higher staff costs in both Qtr 4 YOY and QOQ.  Lower total income on its biggest segment, Institutional Banking which was mainly dragged lower by non-interest income as contributions from investment banking fees and treasury customer income were lower.

Croesus Retail Trust
Reduced Croesus Retail 13000 shares at break even (or $4 net realized profit) in order to re-use its proceeds for re-investment into other stocks; remaining stock holdings in it now at 18000 shares.  For its Qtr 2 results higher NPI +48.8% driven by the additions Luz Omori, Croesus Tachikawa and One’s Mall; better tenant sales and property expense savings at Mallage Shobu.  To minimize the exposure to fluctuations in exchange rates, CRT has hedged close to 100% of the distribution for the next 18 months up to June 2016.  Approx 93% of FY2015 and approx 84% of FY2016 rentals have been locked in; lease expiry profile :- 6.7% in FY2015 and 9.6% in FY2016.  87.7% of gross rental income is derived from leases structured as Fixed Term Leases, giving it greater flexibility to adjust rentals and tenant composition.  Nearest debt maturity is in FY2017, which is 19% of total long term debt.  Major lease expiring beyond year 2018 at 72.5%.  During the current financial year ending 30 June 2015, Mallage Shobu, CRT’s largest property has completed most of the negotiations to either replace or renew lease agreements with approximately 150 tenants. The rental income for these tenants accounts for approximately 16% of the total revenue of the current portfolio. The near completion of its rental reversion exercise is set to maximise future cash flow.

Added 10700 shares (Cash 1500 shares + SRS 9200 shares) under both Cash and SRS stock holdings.  Total stock holdings in it now at 11200 shares (Cash 200 shares + SRS 9200 shares) For its Qtr 1, revenue -6.5%, profit -20.0%.  Lower revenue due to lower advertisement and circulation revenue  Lower profit mainly due to its share of net loss of associates and jointly-controlled entities from its investment in the regional online classified business.  Staff costs grew by S$1.5 million (1.7%) due to acquisition of new businesses and incentives to drive growth and retain staff in a tight labour market; headcount lowered to 4310 from 4322 previously.  The Seletar Mall was officially opened on November 28, 2014 and is expected to contribute to its property business from 2Q 2015.  It will maintain a conservative stance on its investment portfolio allocation with focus on capital preservation. Returns are expected to be commensurate with a low risk-return profile to mitigate against volatility.

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