Month: May 2009
MIIF – BT
MIIF Q1 profit more than doubles to $23.4m
MACQUARIE International Infrastructure Fund (MIIF) yesterday reported a net profit attributable to equity holders of $23.4 million for the first quarter ended March 31, 2009 – more than twice the $9.2 million figure a year ago.
The increased takings resulted from higher investment income, a higher foreign exchange gain and lower operating expenses.
‘We have seen markets, especially for our patronage assets in China and Europe, worsen through the start of 2009,’ said the CEO of MIIF’s manager, John Stuart.
The amount of debt held in some of MIIF’s businesses may be unsustainable amid tight European debt markets, and these businesses may have to tackle the situation in the short term, he said. ‘As a result, we are likely to see some pressure on MIIF’s investment income over the remainder of the year.’
MIIF amended its dividend policy late last year, retaining surplus cash to repay corporate-level debt. It said it hoped to fully repay this debt by end-2009.
In Q1, however, standalone company borrowings rose from $20 million at Dec 31, 2008 to $50.1 million at March 31. The increase was largely due to a temporary $30 million drawdown for MIIF’s 2008 final dividend and an equity investment.
At April 30, 2009, the borrowings stood at $35 million. MIIF expects this to fall when it receives distributions from its Chinese port and expressway businesses in Q3 2009.
‘If debt markets remain challenging, it may be necessary for borrowing levels within certain businesses to be reduced,’ MIIF said. If these businesses amortise certain debt facilities ahead of maturity, ‘receipts from the underlying businesses would be reduced with a commensurate effect on MIIF’s ability to make distributions to shareholders’.
MIIF units lost two cents yesterday to close at 38.5 cents.
SingTel – BT
SingTel posts highest subscriber gain
Exclusive handset deals and aggressive mobile promotions continue to make more consumers ‘see red’, with Singapore Telecom chalking up the biggest subscriber gain among the three local operators in the first quarter of this year.
The country’s largest telco said yesterday that it added 34,000 new mobile customers in Q1, to take its Singapore cellular base to 2.98 million.
In contrast, rival StarHub gained 16,000 new mobile subscribers in Q1, while MobileOne lost 11,000 customers.
With the Q1 addition, SingTel has increased its market share three percentage points from last year to 46.4 per cent.
The company’s winning streak was fuelled partly by its exclusive tie-up for coveted handsets such as Apple’s iPhone 3G. And in February this year it got first bite at Singapore’s first ‘Google phone’, a touch-screen handset from Taiwanese maker HTC.
SingTel’s gains, however, could not mask the underlying trend that the island’s mobile market is finally cooling off after years of sizzling growth.
Statistics from the Infocomm Development Authority of Singapore show the cellular penetration rate grew a mere 1.3 per cent to 132.6 per cent in Q109. In the same period last year, the growth was twice as high at 3.5 per cent.
Amid the deep recession, even defensive plays such as telcos are feeling the pinch, with StarHub citing lower voice usage and international calls as key reasons for a drop in its mobile earnings last week.
On a regional level, SingTel, which reports its full-year results today, grew its mobile base by 17 million sequentially to end-Q1 with a combined customer base of 249 million. Its Australian unit Optus contributed 156,000 new subscribers to the overall tally.
Among its six regional associates, India’s Bharti recorded the biggest increase, growing its subscriber count 9.7 per cent or 9.3 million from the previous quarter to 93.9 million.
In Indonesia, Telkomsel added 6.8 million subscribers during the quarter.
SingTel’s Thai and Philippine associates – AIS and Globe – increased their subscriber bases by 112,000 and 1.04 million during the quarter, while Warid and PBTL reported quarterly gains of 462,000 and 64,000 respectively in Pakistan and Bangladesh.
SPH – BT
SPH divests its 35% stake in TOM OMG
SPH AlphaOne transfers stake for HK$60m
SINGAPORE Press Holdings (SPH) is divesting its 35 per cent stake in TOM Outdoor Media Group (TOM OMG) for HK$60 million, or about S$11 million.
The media group announced that its wholly owned subsidiary SPH AlphaOne entered into an agreement yesterday to transfer its entire stake in TOM OMG to TOM Outdoor Media Holdings, which owns the remaining 65 per cent.
In March 2006, SPH invested US$26 million to take up its 35 per cent stake in the billboard unit of TOM Group Ltd, a publishing, advertising and Internet company controlled by Hong Kong billionaire Li Ka-shing.
The strategic partnership was SPH’s maiden venture into China’s outdoor advertising sector aimed at gaining a foothold in that sector.
SPH said yesterday that the consideration of HK$60 million was arrived at on a ‘willing buyer willing seller’ basis, and took into account the financial performance and future prospects of TOM OMG.
TOM OMG had posted an audited net loss of HK$13 million for the year ended Dec 31, 2007, and an unaudited net loss of HK$102 million for the year ended Dec 31, 2008.
SPH said that the consideration will be fully settled in cash on the date of completion, which is expected to be 14 days from the signing of the agreement.
The company said that the transaction will have no material impact on its earnings, nor on its net tangible assets per share in the financial year ending Aug 31.
SPH’s chief executive Alan Chan, who is also a director of TOM OMG, will cease to be a TOM OMG director upon completion of the deal.
SPAusNet – BT
Company’s full-year income down 6.7% to A$147m
(MELBOURNE) SP AusNet, the Australian electricity distributor 51 per cent owned by Singapore Power Ltd, is seeking A$415 million (S$462.6 million) from a share sale to strengthen its power and gas supply network in Victoria state.
Investors will be offered one share for every four they own at 78 Australian cents, the Melbourne- based company said in a statement to the Australian stock exchange yesterday. That’s 13 per cent below the last traded price of 90 Australian cents.
Capital spending is projected to rise 18 per cent in the year ending March 31, 2010 because of increased energy demand in Australia’s second-largest city, SP AusNet said.
It joins Santos Ltd in seeking funds from investors. The nation’s third-biggest oil and gas producer said on Monday it was raising as much as A$3 billion in a share sale.
‘The capital raising is well in excess of our expectations,’ Credit Suisse Group analysts led by Sandra McCullagh said in a note yesterday. ‘We had assumed that SP AusNet could cut distributions over the next five years to fund growth capex whilst maintaining it’s A-minus credit rating,’ said Sydney-based Ms McCullagh, who rates the stock ‘outperform’.
SP AusNet has dropped 5.3 per cent since the start of the year, compared with a 2.3 per cent decline in the exchange’s utilities index.
Of the share offer, A$330 million for sale to institutional investors is fully underwritten by Macquarie Group Ltd and UBS AG, SP AusNet said, with a further A$85 million available to retail investors. Singapore Power intends to take up its full entitlement of A$211 million.
Funds will also be used to support its A-range credit rating, SP AusNet said.
‘By strengthening our balance sheet and providing a prudent funding flexibility, these capital management initiatives will complement SP AusNet’s existing ability to deliver sustainable growth in security holder value,’ SP AusNet managing director Nino Ficca said. The recession hasn’t caused a slowdown in new customer connections, chief financial officer Geoff Nicholson said.
Full-year net income fell 6.7 per cent to A$146.9 million in the 12 months ended March 31, SP AusNet said separately yesterday. SP AusNet took a A$30.3 million after-tax charge after the writedown of meters to be replaced in Victoria.
Earnings before interest, tax, depreciation and amortisation rose 9.5 per cent to A$709.6 million.
SP AusNet declared a final distribution of 5.927 Australian cents, bringing the total for the year to 11.854 cents. Distributions in the 12 months to March 31, 2010 are expected to be eight Australian cents per security, SP AusNet said.
StarHub – DBS
Improved market share & margins
• Net profit of S$82m (+3% y-o-y) was slightly ahead of expectations due to better margins
• Corporate data segment was the star performer and key factor for the +6% revision to FY10F earnings
• Trading at similar valuations to M1, despite stronger business model. Buy for attractive valuations and assured 18 cents DPS.
Corporate data business was star performer. Net profit of S$82m (+3% y-o-y, -6% q-o-q) was ahead of our S$80m forecast, due to strong results at its corporate data business. We believe StarHub’s new COO, Mr Tan Tong Hai (credited with turning around Singapore Computer Systems, which was acquired by SingTel recently) is the key driver of corporate business – the next growth engine for StarHub. There was weakness in mobile and broadband ARPU due to the weak economy, but overall service EBITDA margin of 33% was better than we expected. There were improvements in its mobile and pay TV market shares.
FY10F earnings raised by 6%. Management revised its EBITDA margin guidance from 31% of service revenue to 32%, while service revenue would be flat, in line with our FY09F estimates. We raised FY10F earnings by 6% in view of stronger growth from the corporate data segment as StarHub increases access from 800 buildings currently to 2,600 buildings in the next 2-3 years through the National Broadband Network.
Attractive valuations and assured 9.4% yield. The market is worried about SingTel bidding irrationally high for English Premier League (EPL) content in 3Q09. We believe this is unlikely to happen, as SingTel is a ROI driven company. But to be conservative, we factored in high cost of EPL content in our FY10F and FY11F estimates. Maintain Buy and S$2.20 target price, pegged to 12x PER