Author: tfwee
SPAusNet – SGX
Notification of Cancellation of General Meeting
Notice is hereby given that the general meeting of SP Australia Networks (Distribution) Ltd, SP Australia Networks (Transmission) Ltd and SP Australia Networks (Finance) Trust (“SP AusNet”) scheduled for 10.00am on Tuesday 11 December 2007 has been cancelled.
The SP AusNet Board has decided not to proceed with the proposed acquisition of the Alinta assets and businesses from its majority securityholder Singapore Power International Pte Ltd (“SPI”).
The Board has noted the ongoing deterioration in capital markets, in particular debt capital markets, since the Explanatory Memorandum was released. Current conditions would have a material impact on the overall transaction metrics, as well as SP AusNet’s ability to achieve the forecasts provided in the Explanatory Memorandum.
The Board and its financial advisers, Pacific Road, therefore consider it is no longer in the best interests of SP AusNet to proceed with the transaction.
SP AusNet Chairman, Mr Ng Kee Choe, said, “The management team has spent considerable time with our existing and potential new securityholders since the release of the Explanatory Memorandum in November and the Board acknowledges that investors have had mixed views on the proposed acquisition.
However, had the capital market conditions been more favourable for raising fresh debt and equity capital the Board would have proceeded to the securityholder vote.”
“Obviously we are disappointed with this outcome. However, the strong fundamentals of our existing business position us well for future growth and we aim to continue to provide a stable and sustainable investment for securityholders today and into the future,” Mr Ng said.
“While the decision to not proceed was a difficult one, it reflects an open, rigorous and transparent process”, said Mr Ian Renard, Chairman of the Independent Directors’ Committee.
The 2007/08 and 2008/09 forecasts provided in the Explanatory Memorandum for the existing SP AusNet business remain applicable. However, SP AusNet has incurred a portion of the costs of the transaction, estimated at approximately $26 million (per page 17 of the Explanatory Memorandum), which will be expensed to the profit and loss in the 2007/08 full year financial statements.
SP AusNet Managing Director, Mr Nino Ficca, said, “Our investors can be sure that the focus of the SP AusNet management team will be on continuing to deliver value from our high quality regulated assets through organic growth, operating efficiencies and delivering on the forecasts outlined for SP AusNet in the Explanatory Memorandum.”
SP AusNet and SPI have, throughout the transaction, been impressed with the benefits which could accrue to the two groups in streamlining and optimising business and operational processes. The two groups will continue to work together to ensure that mutual benefits are realised.
SPI has advised that for the time being, it will manage the Alinta assets as a separate entity and will continue to work closely with SP AusNet to achieve synergies and explore growth opportunities for SP AusNet going forward.
SP AusNet maintains its 2007/08 full year distribution guidance of 11.55 Australian cents per security.
Source : SGX
SPH – BT
Sky@eleven will boost SPH earnings: Tony Tan
Analysts estimate project to yield up to $450m profit
SINGAPORE Press Holdings is expecting a significant boost to its profits for this financial year and the next – from its Sky@eleven condominium project. In his speech at the media group’s annual general meeting yesterday, SPH chairman Tony Tan said: ‘On the property front, our launch of Sky@eleven, a luxury condominium project at Thomson Road, was greeted with overwhelming response. All 273 units were sold out within hours of the soft launch in January 2007.
‘ SPH will enjoy a significant boost to its profits in the next two financial years from contributions from Sky@eleven.’
‘The last financial year has been a good year for SPH,’ said Dr Tan. ‘With group operating revenue of $1.16 billion, net profit attributable to shareholders crossed the half-billion mark to hit $506.2 million.’
The group’s $506.2 million net profit was 18.1 per cent higher than the previous year’s $428.5 million, which included an exceptional gain of $66.8 million.
The FY2007 results included a maiden profit recognition of $47.8 million from Sky@eleven. Profits from Sky@eleven are being recognised on a percentage-of-completion basis and temporary occupation permit (TOP) is expected in early 2010.
Analysts had estimated total profits from the project at $350 million to $450 million.
At yesterday’s AGM, some shareholders were concerned about the group’s core print business, citing trends of declining newspaper readership in other developed countries.
Another shareholder asked about generating more revenue from online media. Responding, Dr Tan said that the group is continuing to invest in other media platforms.
‘$100 million has been earmarked to invest in the Internet (business). So when the trends overseas come to Singapore, SPH will be prepared and be in a good position to exploit the online space.’
Like any new business venture, building revenue from online services will take time, he said.
Dr Tan also said that SPH is making further inroads into the online search business. Online search and directory services for the China and Singapore market are expected to be rolled out next year, as well as regional online classifieds, he said.
Both are part of the joint venture formed last year with Norwegian media group Schibsted ASA. ‘Online directory portals will be the future for SPH,’ Dr Tan said.
The traditional core newspaper and magazine business continued to make up the bulk of profits for the group, and investing in its current stable of papers continues.
Singapore’s first Chinese freesheet my paper will be revamped into a full-fledged bilingual newspaper early next year. It will have equal emphasis on the Chinese and English languages and will be expanded into a 48-page paper from its current 24-page format.
‘Circulation of our other newspapers, such as The Business Times, Berita Harian and Tamil Murasu, also registered creditable increases on the back of strong support from readers and advertisers,’ said Dr Tan.
SPH announced yesterday that directors Cheong Choong Kong and Lee Ek Tieng would step down. Dr Cheong was appointed a director of SPH in 1997. Mr Lee joined SPH as a director in 2001.
November 2007
Results Announced
- 21-Nov-07 (before mkt open) : SPAusNet 1H08 – EPS A5.72ct ; DPS A5.776ct
- 13-Nov-07 (mkt close) : ComfortDelfro Q307 – EPS 2.84ct (todate 8.33ct)
- 12-Nov-07 (mkt close) : SBSTransit Q307 – EPS 3.27ct (todate 13.61ct) ; DPS 8ct (todate 14ct)
- 7-Nov-07 (before mkt open) : SingTel Q207 – EPS 6.21ct (todate 12.04ct) ; DPS 5.6ct
- 1-Nov-07 (mkt close) : StarHub Q307 – EPS 4.78ct (todate 13ct) ; DPS 4ct
|
Stock |
Period |
DPS ct |
Price |
Yield |
PE |
Div Breakdown |
|---|---|---|---|---|---|---|
|
SPH |
FY07 – Aug |
26.0 |
S$4.54 |
5.727% |
14.19 |
Interim 7ct ; Final 9ct + 10ct (Special) |
|
SingPost |
FY07 : Mar |
6.25 |
S$1.09 |
5.734% |
14.95 |
Q1 1.25ct ; Q2 1.25ct ; Q3 1.25ct ; Q4 2.5ct |
|
Sing Food |
FY06 : Dec |
5.4 |
S$0.80 |
6.750% |
13.56 |
Interim 2.2ct ; Final 3.2ct |
|
Stock |
Period |
DPS ct |
Price |
Yield |
PE |
Div Breakdown |
|---|---|---|---|---|---|---|
|
SBSTransit |
FY06 : Dec |
28.5 |
S$2.95 |
9.661% |
15.96 |
Interim 5ct ; Final 6.5ct + Special 17ct |
|
ComfortDelgro |
FY06 : Dec |
11.0 |
S$1.91 |
5.759% |
16.19 |
Interim 3.125ct + Special 3.375 ; Final 3ct + Special 1.5ct |
|
SMRT |
FY07 : Mar |
7.25 |
S$1.61 |
4.503% |
18.09 |
Interim 1.5ct ; Final 5.75ct |
|
Stock |
Period |
DPS ct |
Price |
Yield |
PE |
Div Breakdown |
|---|---|---|---|---|---|---|
|
SingTel |
FY07 : Mar |
20.6 |
S$3.88 |
5.309% |
16.69 |
Interim 4.6ct ; Final 6.5ct + Special 9.5ct |
|
M1 |
FY06 : Dec |
13.3 |
S$2.01 |
6.617% |
12.11 |
Interim 5.8ct ; Final 7.5ct |
|
StarHub |
FY06 : Dec |
11.5 |
S$3.00 |
3.833% |
17.05 |
Q1 2.5ct ; Q2 2.5ct ; Q3 3ct ; Q4 3.5ct |
|
Stock |
Period |
DPS ct |
Price |
Yield |
NAV |
Div Breakdown |
|---|---|---|---|---|---|---|
|
SPAus |
1H : Sep-07 |
7.2535 |
S$1.62 |
8.955% |
A$1.11 (NTA) |
1H A5.6143ct @ 1.292 |
|
MIIF |
1H : Jun-07 |
4.15 |
S$1.00 |
8.300% |
$1.19 |
1H 4.15ct |
|
MacCookPSF |
Q1 : Sep-07 |
3.03626 |
S$1.33 |
9.132% |
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 30-Nov-07
- SPAus : 1H08 (Sep07) – A5.776ct (before tax) / A5.6142ct (after tax) or S7.2535ct @ 1.292 Exchange Rate fm Yahoo (Rate to be Updated on Payment Day 19-Dec-07)
- SBSTransit : Q307 (Sep) – 8ct ; Q207 (Jun) – 6ct
- SingTel : Q208 (Sep07) – Interim 5.6ct
- StarHub : Q307 (Sep) – 4ct ; Q207 (Jun) – 4ct ; Q107 (Mar) – 3.5ct
- 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
- MIIF : 1H07 (Jun) – 4.15ct
- ST Engg : Q207 (Jun) – 2ct
- M1 : 1H07 (Jun) – Interim 2.5ct + Capital Reduction 4.6ct
Thomson Medical – CIMB
There’s demand, but where’s the space?
2008 outlook
Higher baby deliveries and inpatient admissions expected in 2008, on the back of: 1) increased patient loads seen by tenant specialists, peripheral specialists and the network of Thomson Women’s Clinics, with another clinic to be added in 1H08; 2) TMC’s strong branding and reputation as the only private women’s and children’s hospital in Singapore; 3) the government’s marriage and procreation incentives; 4) an immigration boom, especially of skilled professionals of reproductive age; and 5) a still-healthy Singapore economy and relatively robust regional economies.
Room to raise rates. TMC renovated two wards this year and will be renovating another two in FY08. After renovation, it will be positioning one as a premium ward. With its fees among the lowest of the private hospitals, there remains much potential for fee hikes, particularly with its enhanced facilities.
Still room to grow? TMC’s hospital is near full occupancy at more than 80%. While it has actively rationalised space to create additional capacity and increased patient admissions by encouraging patients to be discharged earlier, we remain cautious that capacity constraints could limit its longer-term growth.
Recurring fee income from Vietnam project. We expect the group to receive US$0.5m and US$0.3m in consultancy fees in FY08 and FY09 respectively. Upon completion in 2009, the group will manage the Vietnam hospital for five years with the option for another five. Hospital management fees are typically 2-4% of revenue and 3-5% of net profit. We have not imputed fee income from hospital management in our forecasts as details are not yet available. Further upside could come from the exercise of a second option to take an equity stake of up to 25% within three years from the commencement of operation. In addition, management announced in Nov 06 that it would be undertaking project-consultancy contracts for two more greenfield women’s and children’s hospitals within the next 18-36 months on an exclusive basis.
Valuation and recommendation
Target price reduced to S$0.77 from S$0.88; downgrade to Neutral from Outperform. We have reduced our earnings estimates by 5-10% for FY09-10 on the back of potential capacity constraints (lower number of beds assumed). Following this, our target price has been lowered to S$0.77 from S$0.88, based on 15x CY09 P/E, still a 15% discount to the peer average. Stock catalysts could come from: 1) regional hospital projects and management consultancy contract wins; and 2) significant capacity expansion.