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Sunday, 24 May 2015

Stock changes 24 May

Updating stocks holdings as of 22 May :-

Fraser And Neave
Invested into it for 400 shares under Cash stock holdings.  For its Qtr 2 results, revenue +3.2%, profit +8.4%.  Higher revenue mainly from brewery segment driven by festive season in Myanmar.  Poor soft drinks sales in Malaysia due to GST implementation and flood situation.  Mix dairies performance - strong sales in Thailand but bad performance in Malaysia and Singapore.   Higher profits mainly from beer and diaries because of improved margins from lower input costs and improved manufacturing and route to market efficiencies.  In January it announced extending dairy brand licence for 22 years for Nestle's liquid-milk brands, making Thailand a production hub for Asean and China. It is currently looking for a replacement energy drink after the exclusive rights to distribute Red Bull expires this coming September.

M1 Limited
Invested into it for 300 shares under Cash stock holdings.  Its Qtr 1 revenue +22.8% mainly driven by higher handset sales due to higher sales volume and selling price.  Profit +6.6% due to higher net profit margin - mainly contributed on service revenue. In March, it signed a Memorandum of Understanding (MOU) with the Maritime and Port Authority of Singapore (MPA) to help the maritime community leverage on mobile technology to enhance productivity and crew welfare.  In April, it signs deal with NetLink Trust to install fibre links.  Also in April, it announced that its customers on 4G plans will now be able to make 4G voice calls on an advanced network at no additional cost.  In May, it announced the agreement to acquire a 15 per cent stake in Integrated Telecommunications Oman.  The Oman telco company is Oman’s first private international gateway operator and a mobile services reseller.

Lum Chang Holdings
Invested into it for 9000 shares under Cash stock holdings.  On its Qtr 3 results, revenue +43%, profit +$299 mil.  Higher revenue was due timing of revenue recognition; and also, due to increase in work performed from three construction projects. Current Price/Book value at 0.699.   It already commenced work as the main contractor for Northpoint City in Nee Soon; expected completion in the 2nd half of 2018.  This latest contract brings the total outstanding value of construction projects still in progress to approximately SGD 966 mil.  NAV on end Mar'15 at 53.65 cents; friday 22 May'15 closing price at 37.50 cents.  Still in free cash flow position even though it is three times lower than previous year.  Controlling family members and other associates has approx 38% stakes in the company.

SembCorp Industries
Invested into it for 3100 shares under Cash stock holdings.  For its Qtr 1 results, revenue -11.0%, profit -23.35%.  Soft revenue contributed mainly by Utilities; biggest revenue contributor Marine reported almost flat revenue drop (-2%).  The decrease in Utilities revenue was due to Singapore operations’ lower gas offtake continued intense competition in the power markets.  On Marine, lower revenue recognition for rig building projects and lower average revenue per repair vessel despite the increase in the number of ships repaired, mitigated by higher revenue recognition for offshore and conversion projects.  Lower profits contributed by both Utilities (-19%), Marine (-13%), Urban development (-95%).  Lowered profits on Utilities due lower contracted retail power prices in its Singapore operations;  Marine profits impacted by lower contribution from rig building and repair projects, higher finance costs and lower associates and joint ventures contributions; big drop in Urban development profitys due to deferred recognition of Nanjing land sales profit to Qtr 2. 

Invested into it for 2500 shares (Cash 200 shares + CPF 2300 shares).  For its Qtr 1 results, revenue +8.1%, profit -12.4%.  Higher revenue mainly driven by higher equipment sales resulted from strong demand for the new smartphones.  Overall positive sales mix except for double digit drop in Broadband revenue due to price competition; which likely continue in the coming quarters.  Higher cogs in line with strong demand for the new smartphones.  Other opex almost flat mainly due to lower operating leases from reversal of excess accruals for international capacity leases which have been concluded at lower prices.  Drop in profits due to higher amount of subsidies from increased number of new and re-contract customers signed up for the new smartphones.  Negative free cash flow currently due to lower cash flow from operating activities and higher capex.  It will maintain annual cash dividend payout of 20 cents per ordinary share for 2015.

SIA Engineering
Invested into it for 300 shares under Cash stock holdings.  For its Qtr 4 results, Revenue -11.3% which impacted profit -38% was 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. Share of profits of associated and joint venture companies also lowered - mainly due to the weaker contributions from the repair and overhaul centres.  Strong and healthy Balance Sheet.  The operating environment for the MRO industry remains challenging. Advancements in the  newer generation engines have improved their reliability while the older generation engines are being phased out.  These developments will continue to result in a reduction in engine shop visits in the next few years. Its share price weakened immediately when Qtr 4 results was released; and it has since gone back to its Qtr 3 results release share price level in early Feb. I would like to think that its expected bad financials already priced in and further downward spiral of its share price is limited though a research house would like to see it reaching $3.00 price level.  Management guidance in the past quarters already mentioned of bad financials in the future quarters. Are investors not already forewarned?  So, come Qtr 1 results announcement around end of July'15 then another lower share price of say, $2.00 is expected by research house?  Throw out more funny bones please.

Keppel Corporation
Added 1100 shares of it under SRS stock holdings so, in total l have 6100 shares in it now.  For its Qtr 1 results, Revenue -6.1%, Profits -5.2%.  Lower Revenue due mainly to a  drop in revenue recorded by Keppel Infrastructure's power and gas business, arising from lower prices and volume, lower revenue from the EPC projects which are nearing completion, as well as absence of revenue from Keppel FMO Pte Ltd which was disposed in Qtr 4 2014.  Poor profits are from its O&M, Property and Infrastructure divisons; decrease in profits mainly due to higher net interest expense and lower contribution from associates such as Floatel and absence of contribution from Marina Bay Financial Centre Tower 3. 

Added 12000 shares under Cash stock holdings but later on, decided to divest all of it (17000 shares = Cash 12000 shares + SRS 5000 shares) for $531 net realized profit.  For its Qtr 2, revenue -3.0%, profit -12.1%.  New revenue contributor, The Seletar Mall helped to reduce impact from lower revenues in advertisement and circulation.  Decline in staff costs mainly arose from lower bonus provision as compared against last year.  Last year's performance was lifted by the one-off gain on partial divestment of stake in the regional online classifieds business.  It will continue with (i) Conservative stance maintained on investment allocation, focused on capital preservation; (ii) Returns are expected to be commensurate with low risk- return profile to mitigate against volatility.

Singapore Post
Invested to it for 500 shares under Cash stock holdings.  For its Qtr 4 results, revenue +28.7%, profit -51.3%.  Strong revenue driven by its Logistics division which grew strongly on higher ecommerce logistics contributions and the inclusion of new subsidiaries; Retail & eCommerce revenue improved as the growth in ecommerce services offset the decline in traditional retail & agency services, and financial services.  Volume-related expenses increased with the inclusion of new subsidiaries and growth in business activities and volumes.  Labour and related expenses were higher as a result of increased operating costs in Singapore and the continuing investment in talent for the growth transformation.  The increase in administrative and other expenses was mainly attributable to higher property related expenses and professional fees related its Transformation initiatives and other administrative expenses. The increase in property related expenses was mainly attributable to higher rental costs for its operations.  Lower profits due to higher Other operations in previous year - commercial property rental operations and unallocated corporate overhead items.


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