Month: October 2007
October 2007
Results Announced
- 30-Oct-07 (mkt close) : SingPost (Q207) – EPS 2.065ct (todate 4.063ct) ; DPS 1.25ct
- 26-Oct-07 (mkt close) : SMRT (Q207) – EPS 2.6ct (5.1ct todate) ; DPS 1.75ct
- 22-Oct-07 (mkt close) : M1 (Q307) – EPS 4.9ct (14.2ct todate)
- 18-Oct-07 (mkt close) : Sing Food (Q307) – EPS 1.1ct (3.8ct todate) ; DPS 1.8ct
- 12-Oct-07 (mkt close) : SPH (FY07 – Aug07) – EPS $0.32 ; DPS 9ct (Final) + 10ct (Special)
|
Stock |
Period |
DPS ct |
Price |
Yield |
PE |
Div Breakdown |
|---|---|---|---|---|---|---|
|
SPH |
FY07 – Aug |
26.0 |
S$4.58 |
5.677% |
14.31 |
Interim 7ct ; Final 9ct + 10ct (Special) |
|
SingPost |
FY07 : Mar |
6.25 |
S$1.22 |
5.123% |
16.74 |
Q1 1.25ct ; Q2 1.25ct ; Q3 1.25ct ; Q4 2.5ct |
|
Sing Food |
FY06 : Dec |
5.4 |
S$0.805 |
6.708% |
13.64 |
Interim 2.2ct ; Final 3.2ct |
|
Stock |
Period |
DPS ct |
Price |
Yield |
PE |
Div Breakdown |
|---|---|---|---|---|---|---|
|
SBSTransit |
FY06 : Dec |
28.5 |
S$3.08 |
9.253% |
16.67 |
Interim 5ct ; Final 6.5ct + Special 17ct |
|
ComfortDelgro |
FY06 : Dec |
11.0 |
S$1.93 |
5.699% |
16.36 |
Interim 3.125ct + Special 3.375 ; Final 3ct + Special 1.5ct |
|
SMRT |
FY07 : Mar |
7.25 |
S$1.76 |
4.119% |
19.78 |
Interim 1.5ct ; Final 5.75ct |
|
Stock |
Period |
DPS ct |
Price |
Yield |
PE |
Div Breakdown |
|---|---|---|---|---|---|---|
|
SingTel |
FY07 : Mar |
20.6 |
S$4.08 |
5.049% |
17.55 |
Interim 4.6ct ; Final 6.5ct + Special 9.5ct |
|
M1 |
FY06 : Dec |
13.3 |
S$2.10 |
6.333% |
12.65 |
Interim 5.8ct ; Final 7.5ct |
|
StarHub |
FY06 : Dec |
11.5 |
S$3.12 |
3.686% |
17.73 |
Q1 2.5ct ; Q2 2.5ct ; Q3 3ct ; Q4 3.5ct |
|
Stock |
Period |
DPS ct |
Price |
Yield |
NAV |
Div Breakdown |
|---|---|---|---|---|---|---|
|
SPAus |
2H : Mar-07 |
7.0846 |
S$1.71 |
8.286% |
– |
1H A5.4841ct @ 1.2105 ; 2H A5.4766 @ 1.2936 |
|
MIIF |
1H : Jun-07 |
4.15 |
S$1.09 |
7.615% |
$1.19 |
1H 4.15ct |
|
MacCookPSF |
Q1 : Sep-07 |
3.03626 |
S$1.36 |
8.930% |
A$1.06 |
Q108 A2.31ct @ 1.3144 |
* SPAus and MacCookPSF DPU in A$. Yield is thus also Dependent on Exchange Rate
NOTES :
- Mkt Price is as on 31-Oct-07
- SingPost : Q208 (Sep) – 1.25ct ; Q108 (Jun) – 1.25ct
- SMRT : Q208 (Sep07) – Interim 1.75ct
- MacCookPSF : Q108 (Sep07) – A2.625ct (Gross) / A2.31ct (After With-hldg Tax)
- Sing Food : Q307 (Sep) – 1.8ct
- SPH : FY07 (Aug) – Final 9ct + Special 10ct ; Interim (Feb) 7ct
- ComfortDelgro : Q207 (Jun) – Interim 3.35ct + Special 4.15ct
- SBSTransit : Q207 (Jun) – Interim 6ct
- MIIF : 1H07 (Jun) – 4.15ct
- ST Engg : Q207 (Jun) – 2ct
- StarHub : Q207 (Jun) – 4ct ; Q107 (Mar) – 3.5ct
- M1 : 1H07 (Jun) – Interim 2.5ct + Capital Reduction 4.6ct
- SPAus : 2H07 (Mar07) – A5.4766ct @ 1.2936 ; 1H07 (Sep06) – A5.4841ct @ 1.2105
- SingTel : Q407 (Mar07) – Final 6.5ct + Special 9.5ct ; Q207 (Sep06) – Interim 4.6ct
SingPost – UOBKH
Steady 2QFY08 earnings growth for an attractive dividend play
SingPost reported 2QFY08 net profit of S$39.7m, up 9.8% yoy. Excluding onetime items (comprising 2QFY08 sale of Clementi Central HDB shop unit), underlying net profit was up 10.9% yoy to S$34.8m. Revenue rose 8.8% yoy.
Direct mail was star performer in mail segment. Mail revenue rose 8.5% (or S$7m) yoy, and accounted for 73% revenue share, due to mail volume increasing 9.9% yoy. This came on the back of a strong 11.7% rise in bulk mail (80% share of domestic mail), due to a) Direct Mail’s increase of 15.1% (40% share of bulk mail); and b) business and others increasing 9.1%. Public mail (balance 20% share of domestic mail), on the other hand, recorded a mild 1.3% yoy volume growth. Correspondingly, mail operating profit rose 8.9% yoy.
Financial services drove retail segment. Retail revenue rose 9.0% (or S$1.3m) yoy. Financial services revenue surged 29.1%, and accounted for 47% of retail revenue. Remittances and unsecured lending together contributed 80% of financial services revenue.
Underlying operating margin of 37.1% is similar to 2QFY07. Mail operating margin was 39.1%, vs 2QFY07’s 39.0%. Retail operating margin also widened marginally to 16.3% (from 2QFY07’s 16.2%). These were offset by logistics operating margin narrowing to 14.3% (from 2QFY07’s 15.5%), as logistics is a very competitive business.
Robust cashflow generation. Net cash inflow from operating activities was S$79.7m in 1HFY08, up from 1HFY07’s S$74.6m. 1HFY08 capex was a low S$7.8m, or 3.3% of revenue.
High dividend yield. SingPost declared an interim dividend of 1.25¢ ps. SingPost aims to pay out 80-90% of net profit or a minimum of 5¢ ps per annum. We are forecasting 6.8¢ ps total dividends for FY08 (based on 85% payout ratio), giving a yield of 5.5%, which is higher than 3-mth SIBOR of 2.6%.
SingPost remains a BUY. We forecast 2HFY08 net profit to be driven by the increase in postage rates effective 18 Dec 06 and 1 Jul 07, as well as mail volume expansion. SingPost is attractive based on our DCF valuation of S$1.43 per share – we have assumed a terminal growth rate of 0.7%, a WACC of 5.8% (which factors in cost of debt of 4.6% and cost of equity of 8.2%).
SMRT – JPM
Thomson Medical – CIMB
Delivering results
• In line. FY07 net profit of S$9.5m (+40% yoy) is within consensus and 2% above our expectations. Growth was led by increased deliveries, a higher patient load and better contributions from specialist services.
• Revenue rose 13% yoy to S$52.4m, driven by Hospital Operations (+11% yoy) and Specialised Services (+22% yoy). Revenue from Hospital Operations rose to S$41.8m on the back of higher baby deliveries (+7% yoy to a record 7,665 babies) and inpatient admissions from patient referrals from its tenant specialists, peripheral specialists and network of Thomson Women’s Clinics. Revenue from Specialised Services increased to S$10.5m on higher contributions from all its subsidiaries. The hospital consultancy project in Vietnam is progressing as scheduled, with S$0.35m in consultancy fees recognised in FY07.
• Margin improvements. Despite higher staff costs and the closure of two wards for renovation, gross and net profit margins came in at all-time highs of 43% and 18% (17% excluding divestment gains) respectively, thanks to improved operational efficiencies and lower finance costs.
• Record dividend payout of 77%. The group will be paying out a dividend of 1 Sct for 2H07. It paid a total of 1.5 Scts in ordinary and special dividends in 1H07.
• Expansion plans. The group plans to renovate two levels of inpatient facilities and add two operating theatres in FY08. It will further rationalise space to add three medical suites for new specialists and set up another Thomson Women’s Clinic in Ang Mo Kio Hub in 1H08. Both developments are expected to generate patient referrals for its hospital facilities and services. The group is also exploring opportunities to establish a fertility centre in Vietnam to capitalise on Vietnam’s high demand for fertility treatment. Other initiatives introduced in FY07 included the launch of its Enhanced First Born Incentive, Subsequent Born Incentive and Thomson Junior Angels Club programmes to build brand loyalty, as well as the introduction of a Korean service to serve the Korean community in Singapore.
• Maintain Outperform with target price raised to S$0.88. We have raised our FY09 earnings estimate by 6% to reflect stronger contributions from Specialised Services (additional Thomson Women’s Clinic and fertility centre) and introduced FY10 assumptions. We have also raised our target price to S$0.88 from S$0.87, after rolling forward our target basis to CY09 from CY08. Our new target is now based on 16x CY09 P/E (previously 20x CY08 P/E), still maintaining a 15% discount to the peer average.
SMRT – CIMB
No near-term catalysts
• Above expectations. 2QFY08 net profit of S$39.5m (up 25.3% yoy) was 11% above our estimate and 6% above consensus on an annualised basis. The difference was lower-than-expected expenses. Revenue increase of 5.2% yoy to S$197.3m was within our expectations, driven by higher train and bus ridership, improved hire-out rates for taxis, and higher advertising and rental revenue. Core EPS was S$0.026, up 23.8% yoy.
• Expenses well-managed. SMRT’s operating expenses climbed marginally by 0.2% yoy to S$153.6m on lower staff-related costs (-3.6% yoy) and depreciation (-2% yoy) but offset by higher energy costs (+25.8% yoy) on the back of higher electricity costs. Diesel costs remained relatively unchanged despite the volatility in prices. However, with a new electricity contract starting 1 Oct 07, electricity costs are expected to be contained. Maintenance expenses rose 8.4% yoy due to a larger bus and taxi fleet. Although staff costs were lower in 2Q, we expect costs to rise in the coming quarters due to a human-resource shortage, and the need to raise wages to retain staff as well as the impact of higher employers’ CPF contributions.
• Operational outlook. Train operations performed well due to higher ridership and the fare revision in Oct 06. The main growth areas continued to be rentals and advertising on the back of a robust economy and increased rental space at refurbished MRT stations. LRT operations also moved closer to breakeven, but were again plagued by higher energy costs. Taxi operations turned around with a small operating profit of S$0.2m from a loss of S$0.9m in the previous year.
• DCF target price unchanged at S$1.82 (7.5% WACC; 2% terminal growth). We are maintaining our forecasts as we estimate that staff and volatile energy costs in 2H will continue to put downward pressure on profits. We believe upside would be limited, given the lack of share-price catalysts in the near term. Maintain Underperform.