THaiBev

THaiBev - it has tested 78 cents again! Will it be able to hold at this support level ?

 Failing which , it may likely go down to test 75 cents then 70 cents.

 Not a call to buy or sell.

 Please do your own due diligence. T

haiBev - 2Q 2018 result Net Profit decrease 3.2% to 6,346 million Baht( exclude non-recurring expenses relating to business acquisition).

EPS is down 3.8% to 0.25 Baht .

1st Half 2018 EBITDA is down 11.67% to 17,487 million Baht.

First Half 2018 Net profit is down 27% to 10,451 million Baht.

First Half EPS is down 35.1% to 0.37 Baht versus 0.57 Baht last year.

NAV is also lowered from S$0.22 to S$0.21.

Dividend has been cut from 20 cents Baht to 15 cents Baht.(a decrease of 25% )

Looking through at the Interest Bearing debts:



They have to allocate 16,784 million Baht for Mar 2019 interest loan.

The 2nd year i.e. After one year but within two years (Mar 2020), the debt amount is super high at 163,766 million Baht.

After two years , 53,967 million Baht.

Total 234,517 million Baht.

I think the debts may likely affect the profitability for the next financial years as well as the following years whereby the interest bearing has more than 10x of year 2019.



It is good to be extra cautious when dealing with this counter.

Not a call to Buy or sell.

Please do your own due diligence.





The recent Acquisitions :

• In the second quarter ended 31 March 2018, the Company completed an acquisition of

• 75% shareholding interest in Havi Logistic Co.,Ltd. (Havi), which operates logistic businesses for food services in Thailand, by Thai Beverage Logistics Co.,Ltd., a wholly owned subsidiary of the Company on 28 February 2018.



• The Company has included the assets and liabilities of Havi in the consolidated statements of financial position and the results of operations and cash flows in the consolidated statement of income and cash flows respectively from March 2018 onwards.

• Havi’s operations were recognized under the food business segment.

• In the first quarter ended 31 December 2017, the Company completed 4 acquisitions of

1. a 76% shareholding interest in Spice of Asia Co.,Ltd. (SOA) on 3 October 2017 to operate 10 stores of restaurants serving hotpot and Thai food



2. a 75% shareholding interest in Myanmar Supply Chain and Marketing Services Co.,Ltd. and Myanmar Distillery Co.,Ltd. (MSC & MDC), which incorporated in the Republic of the Union of Myanmar, on 12 October 2017 to operate spirits business in Myanmar

3. 252 existing KFC stores in Thailand by The QSR of Asia Co.,Ltd. (QSA), a wholly-owned subsidiary of the Company on 1 December 2017



4. a 53.59% shareholding interest in Saigon Beer – Alcohol – Beverage Joint Stock Corporation (Sabeco), a company incorporated in The Socialist Republic of Vietnam and currently listed in Ho Chi Minh Stock Exchange (HOSE), on 29 December 2017 to operate mainly in beer business

Venture

Venture - it has managed to bounce-off from the oow if $18.50 and rises higher to fill up the Gap if 60 cents dividend, this is rather bullish!

Current price of $21.88 has managed to stay well above it's 200 days moving average,this is rather positive.

Looks like it may move up to tetest $22.30. Crossing over with ease + good volume that mat drive the price higher towards 22.90.

Not a call to buy or sell.

Please do your own due diligence.

A few weeks ago!

Venture - It share price tumble more than 12% from $28.82 to close at $25.29.



This could be due to:

" Shares in the cigarette giant plunged as much as 18 percent after its latest earnings report showed that $4.5 billion spent on four new products are failing to win over new customers. Sales growth of the iQos, a device that heats a tobacco plug without setting it on fire, has been slowing after initial success in Japan.

Philip Morris, which sells Marlboros outside the U.S., reported revenue excluding excise taxes of $6.9 billion, less than the $7.03 billion projected by analysts in a Bloomberg survey. The share decline, to as low as $83.50, was the biggest since the company split from Altria Inc. in 2008. The stock had fallen 4 percent this year through Wednesday’s close of trading. "

quote : https://www.bloomberg.com/news/articles/2018-04-19/philip-morris-sales-disappoint-as-cigarette-demand-slips-further

I think Venture could be one of the contract manufacturer for this iQos product for Philip Morris. I think the declining grow rate for this iQos product may affect their future earnings.

Looking through their financial numbers for the past 5 years, we can notice that the company has been able to consistently growing its Total Revenue from 2,329.551m in 2013 to 4,004.539m in 2017.
This is quite impressive.

Next , we take a look at the Net Income figure which has also been increasing from 131.13m in 2013 to 372.82m in 2017. An increase of almost more than 200%. 

EPS has also been growing at CAGR of 31% from $0.319 in 2013 to $0.943 in 2017. This is growing at a high double digits growth rate which is pretty encouraging.

The Total Assets has also been growing /increasing from 2013 to 2017 as per the table below:

This is a Net Net Position company as can be seen the total current Assets of 2,276.156m is more than sufficient to cover its Total Liabilities of 976.141m. Generally, the company has no problem to service it debts.

Ops cash flow is also very healthy which is clocking at CAGR of 40% as can be seen from the table below, the Ops cash flow in 2013 was 106.5m versus 448.5m in 2017. 

Return of Assets and Return of Equity has also been generally increasing from a low single digit grow to a high single digits grow of 9%. And 7.2% to 18% in 2017..This show that the company is capable of demostrating and enhancing the business value.

I have roughly workout the EPS intrinsic value using CAGR of 31% for past 4 years (2013 to 2017) and a discount factor of 12% ( MOS) , the fair value turns up to be around $24.65 .

Interestingly, i have also tried to workout the Ops cash flow intrinsic value using CAGr of 40% for past 4 years ( 2013-2017) , a discount factor of 12% , the fair value is about $24.00.

Therefore, in my view, the current price of $25.29 is trading at a premium level/ above it fair value.

Also the declining sales for iQos may also affect their rev going forward and it may also impact their fair value.

I think investor has to gauge for themselves whether to lock in profit or exit and wait for further insight for next few quarters results.

Dividend has increased marginally from 50 cents to 60 cents in 2017. Yield is about  2.03%

NAV of $7.08 ,  P/B is 3.38 times.


rolling EPS of 0.994, rolling PE of 24.08 times.

Not a call to buy or sell.

Please do you own due diligence.

Trade/Invest base on your own decision.

quote: Jeremyowtaip,I also dug through some historical financial information on Venture Corp. It gives me the impression that it's operating environment is challenging as revenues, operating profits, net profits have dipped over the past decade but recovered in recent years and especially the most recent FY17, the revenue, operating profit and net profit broke new record high.

The big question is whether going forward, can this global giant leader in the electronics and manufacturing service provider continue to grow and break even more record highs. By the outlook painted by the chairman and CEO in their FY17 annual report, it seems that they are positioning themselves in various areas they serve to foster growth. Their chief financial officer also mentioned in one of the article link below that their clients which are global leaders in electronics and manufacturing industries rely on Venture Corp for their strong R&D capabilities while the clients can focus on what they do best in their own businesses. Thus, the business model of Venture Corp is such that the various clients they serve will be sticky to Venture Corp. However, the chairman and CEO did pointed out that 2018 maybe a volatile year for them.

I am not sure what the chairman and CEO means by year 2018 maybe volatile. We do see a recent news of Philip Morris, one of the many clients which Venture Corp serves which is involved in selling IQOS (I Quit Ordinary Smoking) devices revealed in it's recent earnings call that their sales of IQOS may fall short of their ambitious expectations. According to Venture Corp's FY17 annual report based on the CIMB article link below, only one client accounts for more than 10% of Venture Corp's FY17 revenue of which CIMB thinks it is not Philip Morris. Therefore, this recent negative news will still impact Venture Corp's revenue this year 2018, but it is likely not a significant impact since the potential contribution to Venture Corp's revenue is not more than 10% of it's total revenue.

Venture Corp has strong balance sheet in a net cash position. It has been generating good amount of positive operating cashflows for the past decade. And it's required capital expenditures (capex) every year have been small resulting in high amount of free cashflows generated for the past decade every year. The small amount of capex requirement every year could be so as Venture Corp is more of a service provider for it's clients rather than a manufacturer, therefore it need not expend high capex to purchase a whole lot of plants and equipments.


I also checked up the compounded annual growth rate (CAGR) of it's diluted EPS over the past 5 years since it's profitability has improved over the past 5 years. Venture Corp has grown it's diluted EPS at a CAGR of 20.68% over the past 5 years. Since Venture Corp's latest FY17 performance was an exceptional year and I am not sure whether it can parallel such exceptional performance continually for the next 7 years of a business cycle, I will take a very conservative stance and estimate that it can only grow it's diluted EPS at CAGR of 6% for next 7 years upon it's current record breaking diluted EPS factoring in that the chairman and CEO mentioned before that 2018 is likely a volatile year for them. Therefore assuming this CAGR of 6% for it's diluted EPS going forward, using my method of estimation, I work out the fair share price of Venture Corp to be around $26.65. Based on one of the article link below by CIMB Research, their target price for Venture Corp is $30.81.

Venture Corp last closed at $25.29. Thus, I believe we are about there in terms of a fair share price for it. If an investor is worried whether the share price still has room for falling, then my suggestion is to wait for further price weakness to get it even cheaper or wait for the price to stabilise before buying. The cheaper one gets it below the estimated fair share price, the larger margin of safety one will receive to cushion the impact from Philip Morris affecting Venture Corp. Any further selling of the shares based on what I can see could be an over-exaggerated reaction to the impact from Philip Morris on Venture Corp's performance this year.

Venture Corporation Limited, together with its subsidiaries, provides technology services, products, and solutions in the Asia Pacific. The company operates through Electronics Services Provider, Retail Store Solutions and Industrial, and Components Technology segments. It offers manufacturing, product design and development, engineering, and supply-chain management services to the electronics industry. The company also designs, manufactures, assembles, distributes, and trades in electronic, mechanical, and computer related products and peripherals; manufactures and sells terminal units; develops and markets color imaging products for label printing; designs, integrates, and trades in electronic security systems; and develops and supports information systems. In addition, it engages in the provision of manufacture, design, engineering, customization, and logistics and repair services; manufacture, design, fabrication, stamping and injection, metal punching, and spraying of industrial metal parts, tools, and dies; and design, customization, and marketing of tool-making and precision engineering solutions. Further, the company manufactures plastic injection molds and moldings with secondary processes and subassembly; and provides manufacturing services to electronics equipment manufacturers, as well as offers management services. Additionally, it imports and exports electronic parts, components, equipment, devices, and instruments. Venture Corporation Limited was founded in 1984 and is headquartered in Singapore.

Hi-P

Hi-P : The S&P 500 gained 0.7 percent and closed at 2,733.01 as industrials jumped 1.5 percent. The Nasdaq composite climbed 0.5 percent to 7,394.04 as semiconductors pushed tech higher. (Cnbc.com)

Chart wise, yesterday it has managed to close with a nice bullish pin bar ,this is rather bullish! Looks like Bull is able to take control of the Bear and close well at 1.41 . 

It may likely move up to test 1.50 then 1.52 with extension to 1.56. 

Not a call to buy it sell.

Please do your own due diligence.



Latest 1Q result for your reference. Gross Profit increased 13% to reach 37.8m. 
Net Profit increase marginally of 1.3% to 12.1m after factoring the foreign exchange loss of 13m..

Hi-P International Limited operates as an integrated contract manufacturer serving the telecommunications, consumer electronics, computing and peripherals, lifestyle, and medical and industrial devices industries. The company operates through three segments: Precision Plastic Injection Molding; Mold Design and Fabrication; and Provision of Sub-Product Assembly and Full-Product Assembly Services. It manufactures and sells molds and special tools, related housing appliance plastic components and equipment, and water treatment equipment; plastic components and plastic product modules; mold base and components; electric components and electronic communication equipment; in-mold decoration lenses; precision stamped metal components and precision tools; and metal and non-metal stampings, as well as provides spray painting, engineering support, maintenance, and technology consultation services. In addition, the company engages in the manufacture, wholesale, import and export, and sale of electronic telecommunication devices, housing appliances, automated equipment, and related components. Further, it manufactures and sells trays, mobile phones, telecommunication products, digital cameras and related electronic products, and electric toothbrushes; assembles coffee machines and parts, as well as provides related maintenance and after-sales services; and offers investment and management consulting services. Additionally, the company engages in the assembly and provision of ancillary value-added services, primarily surface finishing services. It has operations primarily in the People's Republic of China, Singapore, Malaysia, Thailand, Europe, the United States, the rest of Americas, and internationally. The company was founded in 1980 and is headquartered in Singapore.

UMS

UMS reports net profit of S$11.3 million for 1QFY2018

Singapore, May 11 2018 - SGX Mainboard-listed UMS Holdings Limited (“UMS” or “The Group”) continued to reward shareholders with a proposed 1 cent tax-exempt interim dividend as it maintained its profitable track record. The Group reported a net profit of $11.3 million for the first quarter of the financial year 2018 (1Q2018) ended 31 March 2018. Net profit was maintained despite revenue easing 10% to $37.5 million for the quarter.

The lower Group turnover was due to a 9% dip in revenue from the semiconductor business while sales from its “Other” segments fell 44%. Most of the Group’s revenue is denominated in USD which has depreciated against the SGD when compared to 1Q2017.

The Group's profitability was boosted by better gross material margins in 1Q2018 which jumped to 57% from 51% in 1Q2017 as it benefitted from higher component sales vs Integrated Systems sales. Component sales enjoy a higher margin compared to Integrated Systems sales. The improved gross margin reflects the Group’s success in growing its component business to boost its bottom line. The Group has also slashed its income tax expense by 30% as it booked more profits in its Malaysian subsidiary which enjoys Pioneer Tax incentive in Malaysia. Depreciation charges went down by 9% as some of its fixed assets were fully depreciated. Rental fees were cut by 46% as UMS shifted more of its operations to Malaysia. The Group also registered a maiden profit contribution of S$16,000 from its newly acquired associate - Catalist-listed JEP Holdings Ltd.

Profits attributable to shareholders edged up 2% to S$11.4 million in 1Q2018 vs $11.2 million in 1Q2017

Within the semiconductor segment, those of Semiconductor Integrated System decreased 24% to S$18.4 million in 1Q2018 from S$24.2 million in 1Q2017; while revenue from component sales went up by 12% to S$18.7 million - up from S$16.7 million in 1Q2017. Geographically, the first quarter saw revenue from Singapore dip 24% due to weaker demand for the semiconductor Integrated System sales; while US component sales for new system built rose 47% compared to 1Q2017. Revenue from Taiwan rose 16% on the back of higher component spares sales while those in “Other” regions fell 80% due mainly to lower component sales to a customer in China.

Strong Cashflow 

UMS continued to achieve strong cash flow with $15.2 million in net cash from operating activities and $12.0 million in free cash flow in 1Q2018. Bank borrowings pared down by $2.0 million with the Group’s net cash and cash equivalents remaining healthy at S$23.8 million as of 31 Mar 2018. During the first quarter, the Group made an investment of $28.2 million for a 28.6% stake in Catalist-listed JEP Holdings Ltd, in line with its diversification strategy.

The Group’s prospects remain bright in 2018 because of sustained high demand in orders from its key customer. The global semiconductor industry is predicted to continue its strong growth trajectory despite challenges to world economies posed by the ongoing US-China trade dispute

The Group is progressing well with its due diligence for the proposed acquisition of a 70% stake in a non-ferrous metal alloys specialist, Starke Singapore Pte Ltd (“Starke”) which will be funded by internal resources. This proposed deal is in line with UMS' strategy to strengthen its upstream integration to reap cost savings and enhance business and operational synergies within the Group through a more efficient supply chain to serve global customers.

Barring any unforeseen circumstances, prospects remain bright for FY2018.

Quote : http://infopub.sgx.com/FileOpen/UMS%201Q2018%20Press%20Release%20-%20Final.ashx?App=Announcement&FileID=505143

From TA point of view, it has turned bearish after hitting the high of 1.35 on 16 Mar.
The price was corrected from 1.35 to a low of $1.00 last Friday.

It is now trading below most of its Moving average such as 20,50 & 100 days MA.

Currently, the price is coincide with its 200 days moving average.

Hopefully , we may see a bounce-off from here and rises higher to retest 1.08. If not, breaking down of 99 cents would be rather ugly. It may continue to go down to retest 93.5 cents then 90 cents.

Not a call to buy or sell.

Please do your own due diligence.

Japfa

Japfa kickstarts the year with significantly higher revenue and profitability

• The Group recorded higher profitability, driven by strong performance from PT Japfa Tbk

• Animal Protein Other narrowed losses, and generated positive EBITDA in 1Q2018

Singapore, 30 April 2018 – Leading agri-food company, Japfa Ltd (“Japfa”, the “Company”, or together with its subsidiaries, the “Group”) today posted a 58.2% rise in EBITDA to US$103.2 million for the first three months ended 31 March 2018 (“1Q2018”), on the back of a 14.9% revenue increase to US$845.5 million. Core PATMI w/o Forex1 more than tripled to US$28.3million, from US$7.3 million in the corresponding period last year.

The significant improvement in profitability was driven by PT Japfa Tbk’s margin and volume expansion. At the same time, Animal Protein Other (“APO”) narrowed its losses and generated positive EBITDA in 1Q2018, after navigating a challenging year throughout 2017.

On 30 April 2018, the Group completed the acquisition of Black River Funds’ interest in its dairy business (“AustAsia”) and now owns 100% of AustAsia. The Consideration of US$263.1 million was satisfied in full by a cash payment of US$223.0 million which was funded by bank financing, and the issue of 90 million ordinary shares in Japfa Ltd at the issue price of S$0.60 (US$0.45) per share based on the exchange rate of 1.3465 (which is approximately US$40.1 million in aggregate). The total number of issued shares of Japfa Ltd (excluding treasury shares) has increased from 1,756,678,891 ordinary shares to 1,846,678,891 ordinary shares as a result.

The Group has also started recognising 100% contribution from its Dairy business, with effect from 1 January 2018.

The company has 4 different streams of businesses revenue to derive from :

PT Japfa Tbk PT 

Japfa Tbk delivered solid growth in 1Q2018. Revenue rose 16.2% to US$576.3 million, driven by marked improvement in sales volumes across the poultry division. In particular, sales volume for poultry feed grew 14.5%. Operating profit nearly tripled from US$19.5 million a year ago to US$56.4 million in 1Q2018, as operating margin expanded from 3.9% to 9.8%. This was driven by strong growth in poultry feed margin on lower raw material costs, as well as higher ASPs for day-old-chicks and broilers. Another major highlight of PT Japfa Tbk’s performance was the turnaround recorded by its broiler business, from an operating loss of US$5.3 million to an operating profit of US$18.1 million. Poultry feed remains a key driver of profitability across the Group’s animal protein business.

Animal Protein Other

 In Vietnam, operating losses in 1Q2018 narrowed year-on-year to US$2.0 million from US$7.7 million in 1Q2017. The improvement in Vietnam’s profitability was due to (i) lower swine fattening costs as a result of the Group’s cost containment initiatives; (ii) lower costs for feed raw materials; and (iii) higher poultry ASPs. On a quarter-on-quarter basis, Vietnam’s swine prices picked up 11% in 1Q2018 but remained at levels below cost. Swine prices rose during the Tet festival in February 2018, and held steady even after the Tet holiday. In the near term, the curtailed demand following China’s import restrictions since 4Q2016 will continue to affect Vietnam’s swine market. Recovery in swine prices is expected when supply ultimately readjusts down to the new level of demand. The losses in Vietnam’s swine business were compensated by profitability generated by Vietnam’s poultry business, as well as continued profits from the feed businesses in Vietnam, Myanmar and India. As a result, APO reduced its overall Profit After Tax from negative US$6.5 million in 1Q2017 to negative US$1.6 million in 1Q2018. APO recorded a positive EBITDA of US$2.6 million in 1Q2018.

Dairy

 Despite pressure on raw milk prices, Dairy generated consistent profits, with higher milk yields and volumes. Revenue grew 20.2% to US$99.5 million, on growth in raw milk and ESL3 sales volumes in China and South-east Asia respectively. While overall operating profit increased 5.1% to US$19.3 million, operating margin dipped due to lower raw milk prices in China, as well as higher A&P costs in Indonesia as the Group launched a new range of Yogurt and UHT Small Packs – which are targeted to be one of the growth drivers for the Dairy business in Indonesia. Meanwhile, milk yields in China improved from 38.6Kg/head/day to 38.9Kg/head/day. Milkable cows in China increased 8.7% to a population of 42,010 heads as Farm 7 started fully milking in March 2018. Looking forward, the Group will continue to focus on improving milk yields and volumes in China to mitigate price fluctuations. In Indonesia, efforts will be channeled into brand building and widening its range of Greenfields dairy products to capture a larger target segment.

Consumer

 Food The operating landscape for Consumer Food remains challenging amidst heightened competition, particularly in the ambient food sector. In 1Q2018, due to lower sales volume and ASPs for ambient food (eg sausages) year-on-year, Consumer Food recorded an operating loss of US$1.4 million against a 3.1% decline in revenue. However, the Group has rolled out a few initiatives to address the competition. They include raising ASPs for frozen food, brand rejuvenation with a clearer packaging and brand positioning, and improving the taste and quality of “So Good” products. This strategy is beginning to bear fruits, evident from the breakeven EBITDA achieved in 1Q2018, as compared to a loss in 4Q2017. Sales volume of ambient temperature sausages also expanded on a quarter-on-quarter basis.
quote : http://infopub.sgx.com/FileOpen/Japfa%20Ltd%201Q2018%20Press%20Release.ashx?App=Announcement&FileID=502591

From TA point of view, it has a nice breakout of 56 cents on Friday + high volume and close well at 57 cents, this is super bullish!

Short term wise, it may likely move up to 60 cents then 63 cents with extension to 70 cents.

Not a call to buy or sell.

Please do your own due diligence.

Trade/invest base on your own decision.

Japfa Ltd is a leading agri-food producer focused on feeding emerging Asian markets. The Group produces protein staples such as chicken, beef and milk, as well as protein-based consumer food products. From its headquarters in Singapore, Japfa operates its businesses in the fast growing economies of Indonesia, China, India and Indo-China. Backed by two generations of farming experience, it operates industrial-scale farms which are vertically integrated with its downstream food processing operations

Wing Tai

Wing Tai 

NAV $4.09

EPS for first 9 months is 10.87 cents.

Estimate the full year EPS of 15 cents. PE is about 14.1x based on current price of $2.12.

Annual dividend is about 3 cents, yield is about 1.4%.

P/B is 0.51x. Looks like it is trading almost 50% of its NAV.



 For the nine months ended 31 March 2018 (“current period”), the Group recorded a total revenue of S$267.5 million. This is a 31% increase from the S$204.6 million revenue recorded in the nine months ended 31 March 2017 (“corresponding period”). This increase is largely due to the higher contributions from development properties.

 The current period revenue from development properties was mainly attributable to the additional units sold in Le Nouvel Ardmore in Singapore and the contribution from BM Mahkota in Penang. BM Mahkota obtained its Temporary Occupation Permit (TOP) in the current period and the revenue for the units sold has been fully recognized.

 The Group recorded operating profit of S$24.9 million in the current period as compared to S$1.2 million in the corresponding period mainly due to higher contributions from Le Nouvel Ardmore and BM Mahkota as well as the gain on disposal of Huai Hai project in Shanghai.
The Group’s share of profits of associated and joint venture companies increased by 133% to $96.3 million in the current period from S$41.2 million in the corresponding period, largely due to the Group’s share of gain recognized by Wing Tai Properties Limited in Hong Kong from the disposal of Winner Godown Building, an industrial building located in Tsuen Wan.

 In addition, there was contribution from Malaren Gardens in Shanghai from the residential units sold to date and handed over to purchasers in the current period.

The Group’s net profit attributable to shareholders increased from S$10.6 million in the corresponding period to S$89.0 million in the current period.

Cash flow statement for 3rd quarter result seems generating a healthy cash in flow of $144m.

Chart wise, it is on a short term uptrend mode!
Looks like it may retest the recent high of $2.16. Breaking out of $2.16 with ease + good volume, that may propel to drive the price higher towards $2.23 with extension to $2.29.

Not a call to buy or sell.

Please do your own due diligence.

Trade/invest base on your own decision.

Wing Tai Holdings Limited, an investment holding company, engages in property development, property investment, and retailing businesses in Singapore, Malaysia, the People’s Republic of China, and Australia. The company develops residential and commercial properties; and invests in and manages serviced residences under the Lanson Place brand name, as well as manages a boutique hotel in Hong Kong. It is also involved in the manufacture and retail of textile garments; the provision of consultancy and advisory services; and project management and property maintenance activities, as well as in the fund management business.

 As of June 30, 2017, the company operated 206 stores. Wing Tai Holdings Limited was founded in 1955 and is headquartered in Singapore.