Author: kktan
SATS – BT
SATS net profit edges down to $50.1m in Q4
Group proposes final plus special dividends of 21 cents per share
SATS, which has proposed final and special dividends totalling 21 cents per share, registered a net profit of $50.1 million for the fourth quarter ended March 31, down 1.2 per cent.
This is despite a 7.8 per cent rise in revenue to $433.3 million due to increased flights and higher passenger traffic at Changi Airport as well as improved performances by subsidiaries SATS HK and Japan-based airline catering firm TFK Corp.
TFK's revenue grew 12.3 per cent to $81.5 million, as it continues to recover from the natural disasters that hit Japan last year.
Excluding TFK, group revenue would have been up 6.8 per cent largely due to growth in passenger volumes and flights.
ComfortDelgro – BT
ComfortDelGro Q1 earnings climb 6.8% to $53.5m
Revenue up 6.5%, helped by growth in key segments
TRANSPORT group ComfortDelGro posted a 6.8 per cent rise in net profit to $53.5 million for the first quarter ended March 31, as growth across its key business segments boosted revenue by 6.5 per cent.
Revenue for the first quarter was $855.4 million, compared with $803 million in Q1FY11 while earnings per share were 2.56 cents, up from 2.40 cents in the corresponding quarter last year.
Revenue from overseas operations accounted for 40.7 per cent of group revenue.
The group's revenue from bus business registered growth of 4.6 per cent to $410.5 million while operating profit was 13.6 per cent higher at $32.5 million.
ComfortDelgro – BT
ComfortDelGro Q1 earnings climb 6.8% to $53.5m
Revenue up 6.5%, helped by growth in key segments
TRANSPORT group ComfortDelGro posted a 6.8 per cent rise in net profit to $53.5 million for the first quarter ended March 31, as growth across its key business segments boosted revenue by 6.5 per cent.
Revenue for the first quarter was $855.4 million, compared with $803 million in Q1FY11 while earnings per share were 2.56 cents, up from 2.40 cents in the corresponding quarter last year.
Revenue from overseas operations accounted for 40.7 per cent of group revenue.
The group's revenue from bus business registered growth of 4.6 per cent to $410.5 million while operating profit was 13.6 per cent higher at $32.5 million.
STEng – DBSV
All engines firing
• Good start with 1Q12 net profit of S$134.4m (+ 21% yo-y) beating our estimates
• Strong order win momentum in FY12 implies record orderbook levels of close to S$13bn
• Healthy operating cash flows secures dividend outlook
• Maintain BUY and S$3.40 TP
Highlights
Good start to the year. STE reported better-than-expected 1Q12 results, with net profit up 21% y-o-y to S$134.4m on the back of flattish revenues. 1Q12 earnings account for close to 24% of our FY12F, higher than the historical range of 19-22%, as 1Q is generally a seasonally slower quarter for STE. However, we prefer to be conservative and our earnings estimates are unchanged for FY12.
Aerospace and Electronics were the key revenue drivers in 1Q12, as Land Systems revenue declined with the completion of the UK Warthog programme in 1H2011. Gross margins improved across all key segments. While the company had to incur S$7.1m additional SG&A expenses for the Singapore Airshow in 1Q12, this was more than offset by associate contribution of about S$10.8m from Experia, the event organizer of the Singapore Airshow. Operating cash flow in 1Q12 was exceptionally strong at S$546m, due to advance payments/ deposits on newly secured contracts.
Our View
Record orderbooks provide healthy earnings visibility. STE has had a string of major contract wins YTD, including an S$880m contract from the Royal Navy of Oman, contract for building 2 AHTS vessels for Swire Pacific, and a PTF conversion order for 15 B757-200s, among others. Total announced new orders exceed S$1.9bn already in FY12, compared to about S$3.2bn order wins announced in full-year FY11. This brings the outstanding orderbook to an estimated record level of ~S$13bn.
Recommendation
Maintain BUY. Given the recent spate of contracts and attempts at revving up some inorganic growth engines, STE’s growth trajectory seems to be on track. STE looks set to make bigger strides in the Electronics and Land Systems sectors, and has recently teamed with US-based Fortune-500 company Science Applications International Corporation (SAIC) to bid for the US Marine Personnel Carrier program in future. Given the healthy earnings visibility, strong balance sheet and attractive dividend yield of over 5.5%, we maintain our BUY call on the stock with an unchanged TP of S$3.40.
SingTel – DBSV
Associates to grow after two year hiatus
• FY12 core earnings of S$3676m (-3.3% y-o-y) in line with earnings drop due to 41% decline in Bharti’s contribution.
• Final DPS of 9 Scts (including interim DPS of 6.8 Scts) translates to 68% payout ratio and 5% yield; Singtel likely to see high single-digit growth in FY13F.
• Buy for attractive valuation (12.5x PE versus 13.2x hist. avg.), decent growth (FY12-14F EPS CAGR of 5%) and yield (5.6% based on 70% payout ratio).
Highlights
Stable Singapore EBITDA guidance due to start-up losses at Digital Life segment. FY12 EBITDA was stable at S$2.24bn (-0.5% y-o-y) despite 2.3% growth in revenues due to higher mobile connections and costs of acquiring triple play customers. Management guided for low-single digit revenue growth but stable EBITDA on the back of start-up losses at Digital Life. Capex to rise 5% to S$950m due to network enhancements and expansion of Kim Chuan Data Centre.
Stable Optus EBITDA guidance, keeping in mind lower mobile termination rates. FY12 EBITDA was up 1% to A$2357m on the back of a 0.9% growth in revenues. Guidance of low single-digit revenue growth but stable EBITDA due to lower mobile termination rate of 6 cents (prev 9 cents), from January 2012. Staff reduction to help contain costs. Capex to decline 8% to A$1.1bn due to more site-sharing with VHA.
Associates likely to grow 20% in FY13F after two years of decline. FY12 post-tax earnings contribution dropped 12% to S$1414m as Bharti’s 41% decline offset 5% & 31% growth at Telkomsel & AIS respectively. We expect associates to register 20% growth in FY13F on the back of Bharti’s 50% growth (consensus projects 75% growth) and growth at other associates. Bharti’s weakness was due to 3G amortisation costs and paper loss on foreign debt due to weak Indian rupee. Going forward Bharti should register strong growth on a low earnings base as amortization costs are already factored and EBITDA is improving in both India and Africa. Strong SGD is a key risk though.