SPH – OCBC
Headwinds for print continue
- 1QFY15 broadly within expectations
- Seletar Mall officially opened
- Lower fair value to S$3.85
1QFY15 results within expectations
Singapore Press Holdings’ 1QFY15 PATMI came in at S$69.4m, down 21.9% YoY, mostly due to reduced contributions from the core Newspaper and Magazine business whose performance was affected by continued headwinds in the print advertising market. That said, this was broadly within our expectations and 1QFY15 PATMI and total revenues now constitute 25.9% and 25.1% of our full year forecast, respectively. In terms of the topline, we saw 1QFY15 total revenues dip 6.5% YoY to S$310.6m, mainly as contributions from the Newspaper and Magazine segment fell S$20.2m. Advertisement and circulation components were down by S$16.0m and S$3.2m YoY, respectively. In addition, revenue from the group’s other businesses also dipped S$1.8m YoY due to the absence of contributions from key shows this year.
Ad segment continues downtrend
Over 1QFY15, the performance of the core print segment remained uninspiring as display and classified revenue fell 8.3% and 9.5%, respectively. Staff costs were kept mostly flat at S$92.8m, up 1.7% YoY, while the average headcount was also stagnant at 4,310 as at end Nov 14 (versus 4,322 a year ago). Newsprint prices continued to inch down to S$586/MT versus S$598/MT in 4QFY14, while average monthly consumption also fell to 7,847 MT.
Seletar Mall now fully leased
We saw a set of stable results from the group’s property segment. 1QFY15 property revenue increased 1.2% YoY to S$51.4m while Net Property Income also grew 1.8% to S$37.0m. The group’s new Seletar Mall officially opened in 28 Nov 2014 and is now fully leased. We value SPH using a sum-ofthe-parts methodology, and lower our PE multiple for the group’s print segment from 9x to 7.5x, to reflect weakening fundamentals in the sector. Our fair value estimate dips to S$3.85, from S$4.13 previously. Maintain HOLD.
SPH – CIMB
Ads continue to be a dampener
SPH reported 1QFY8/15 net profit of S$69.4m, in line with our estimate at 25% of our full-year forecast, but slightly short of consensus forecast (23%). Its core newspaper business continued to be hit by poor advertisement and circulation revenue, but the bright spot was lower newsprint cost. We revise our FY15-17 EPS estimates marginally to adjust for higher-than-expected share of losses from its investments in the regional online classifieds business. We keep our Reduce call and trim our SOP-based target price to S$4.00 to factor in a lower valuation of SPH REIT. While contributions from Seletar Mall will feature from 2Q15 onwards, we believe the positive impact will be muted by the accelerated fall in newspaper advertisements.
Newspaper segment impacted by falling ads
Revenue in the newspaper segment fell 7.9% yoy (advertisements -8.6% yoy, circulation -6.5% yoy). Advertisements, which contributed 59.6% to total revenue, continued to be adversely impacted by vehicle ownership and property cooling measures. The only bright spot was lower newsprint costs, but this was offset by higher staff headcount, which narrowed the newspaper segment’s PBT margin to 32.9% (1QFY14: 35.2%).
Seletar Mall to contribute in 2Q
Seletar Mall opened on 28 Nov 2014 with committed occupancy of 99.6%. We forecast that the new mall will boost the property segment’s revenue by 9.4% yoy in 9MFY15, based on S$11/psf rent. However, we expect the positive contributions in the property segment to be more than offset by declining advertisements, while its share of net losses from investments in the regional online classifieds business will continue to erode its net profit.
Maintain Reduce
As SPH’s core business continues on a structural decline, it increasingly has to rely on income from its non-core segments and investments in new media to make up for the loss in newspaper revenue. This appears to be a stretch, and we believe consensus has yet to factor in a faster pace of decline in newspaper contributions. That said, upside risks to our call could stem from meaningfully accretive acquisitions in the new media space, and more advertisements from property developers as property completions are expected to accelerate in 2015-16, based on URA data (Figure 4). Our base case assumes 2-4% annual decline in newspaper advertisement revenue in FY15-16, which is already below 1QFY15’s 8.6% yoy decline and the 7.4% yoy fall recorded in FY14.
December 2014
STI = 3365.15 (+197.72 for the Year)
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
Hong Leong Fin |
FY13 (Dec) |
15.85 |
12.00 |
$2.610 |
4.598% |
16.47 |
Interim 4ct ; Final 8ct |
|
SGX |
FY14 (Jun) |
30 |
28 |
$7.810 |
3.585% |
26.03 |
Q1, Q2, Q3 4ct ; Q4 4ct +12ct |
|
SingPost |
FY14 (Mar) |
6.746 |
6.25 |
$1.920 |
3.255% |
28.46 |
Q1, Q2, Q3 1.25ct ; Q4 2.5ct |
|
SPH |
FY14 (Aug) |
25 |
21 |
$4.210 |
4.988% |
16.84 |
Interim 7ct ; Final 8ct + Special 6ct |
Note : SGX Added from May-14 ; Q4 Variable Div Depends on FY EPS
Aviation Services
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SATS |
FY14 (Mar) |
16.10 |
13.0 |
$3.050 |
4.262% |
18.94 |
Interim 5ct ; Final 8ct |
|
SIA Engineering |
FY14 (Mar) |
23.88 |
25.0 |
$4.220 |
5.924% |
17.67 |
Interim 7ct ; Final 13ct + Special 5ct |
|
ST Engineering |
FY13 (Dec) |
18.73 |
15.0 |
$3.400 |
4.412% |
18.15 |
Interim 3ct ; Final 4ct + Special 8ct |
Note : SIAEC Special Div is Observed to be Non-Recurring (Depends on Excess Cash)
Transport
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SBSTransit |
FY13 (Dec) |
3.62 |
1.80 |
$1.705 |
1.056% |
47.10 |
Interim 0.9ct ; Final 0.9ct |
|
ComfortDelGro |
FY13 (Dec) |
12.43 |
7.00 |
$2.600 |
2.692% |
20.92 |
Interim 3ct ; Final 4ct |
|
SMRT |
FY14 (Mar) |
4.10 |
2.20 |
$1.580 |
1.392% |
38.54 |
Interim 1.0ct ; Final 1.2ct |
TELCO
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SingTel |
FY14 (Mar) |
22.92 |
16.8 |
$3.900 |
4.308% |
17.02 |
Interim 6.8ct ; Final 10ct |
|
M1 |
FY13 (Dec) |
17.4 |
21 |
$3.610 |
5.817% |
20.75 |
Interim 6.8ct ; Final 7.1ct + Special 7.1ct |
|
StarHub |
FY13 (Dec) |
21.50 |
20 |
$4.150 |
4.819% |
19.30 |
Q1 5ct ; Q2 5ct ; Q3 5ct ; Q4 5ct |
Infrastructure
|
Stock |
Period |
DPS cts |
Mkt |
Yield |
NAV |
Div Breakdown |
|
AusNet Services |
1H – Sep14 |
A4.18 (Gross) |
$1.420 |
6.371% |
A$0.86 |
1H15 A4.18ct ; 2H14 A4.18ct |
* SPAus DPU in A$. Yield is Calculated Using Latest Exchange Rate (1.0821) fm Yahoo
NOTES :
- Mkt Price is as on 31-Dec-14
- SATSvcs : 1H15 (Sep14) – Interim 5ct
- SingTel : 1H15 (Sep14) – Interim 6.8ct
- AusNet : 1H15 (Sep14) – A4.18ct = A2.2ct (Franked) + A1.98ct (Interest – Subject to 10% Tax) ; 2H14 (Mar14) – A4.18ct = A1.393ct (Franked) + A2.379ct (Interest – Subject to 10% Tax) + A0.408ct (Capital Returns)
- SingPost : Q215 (Sep14) – 1.25ct ; Q115 (Jun14) – 1.25ct
- StarHub : Q314 (Sep) – 5ct ; Q214 (Jun) – 5ct ; Q114 (Mar) – 5ct
- SIAEC : 1H15 (Sep14) – Interim 6ct
- SMRT : 1H15 (Sep14) – Interim 1.5ct
- SGX : Q115 (Sep14) – 4ct
- SPH : 2H14 (Aug) – Final 8ct + Special 6ct ; 1H14 (Feb) – Interim 7ct
- ComfortDelgro : 1H14 (Jun) –3.5ct
- ST Engg : 1H14 (Jun) – 4ct
- SBSTransit : 1H14 (Jun) – 1.25ct
- HLFin : 1H14 (Jun) – 4ct
- M1 : 1H14 (Jun) – Interim 7ct
- SPAus : FY15 Guidance = A8.36ct Gross
- ST Engg : Dividend Payout Reduced from 90% to 80% for FY13 & Will Be Further Reduced to 75% from FY14
- StarHub : FY14 Div Guidance – 5ct/Q
- SingTel : Div Policy – 60% to 75% of Underlying Net Profit
December 2014
STI = 3365.15 (+197.72 for the Year)
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
Hong Leong Fin |
FY13 (Dec) |
15.85 |
12.00 |
$2.610 |
4.598% |
16.47 |
Interim 4ct ; Final 8ct |
|
SGX |
FY14 (Jun) |
30 |
28 |
$7.810 |
3.585% |
26.03 |
Q1, Q2, Q3 4ct ; Q4 4ct +12ct |
|
SingPost |
FY14 (Mar) |
6.746 |
6.25 |
$1.920 |
3.255% |
28.46 |
Q1, Q2, Q3 1.25ct ; Q4 2.5ct |
|
SPH |
FY14 (Aug) |
25 |
21 |
$4.210 |
4.988% |
16.84 |
Interim 7ct ; Final 8ct + Special 6ct |
Note : SGX Added from May-14 ; Q4 Variable Div Depends on FY EPS
Aviation Services
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SATS |
FY14 (Mar) |
16.10 |
13.0 |
$3.050 |
4.262% |
18.94 |
Interim 5ct ; Final 8ct |
|
SIA Engineering |
FY14 (Mar) |
23.88 |
25.0 |
$4.220 |
5.924% |
17.67 |
Interim 7ct ; Final 13ct + Special 5ct |
|
ST Engineering |
FY13 (Dec) |
18.73 |
15.0 |
$3.400 |
4.412% |
18.15 |
Interim 3ct ; Final 4ct + Special 8ct |
Note : SIAEC Special Div is Observed to be Non-Recurring (Depends on Excess Cash)
Transport
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SBSTransit |
FY13 (Dec) |
3.62 |
1.80 |
$1.705 |
1.056% |
47.10 |
Interim 0.9ct ; Final 0.9ct |
|
ComfortDelGro |
FY13 (Dec) |
12.43 |
7.00 |
$2.600 |
2.692% |
20.92 |
Interim 3ct ; Final 4ct |
|
SMRT |
FY14 (Mar) |
4.10 |
2.20 |
$1.580 |
1.392% |
38.54 |
Interim 1.0ct ; Final 1.2ct |
TELCO
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SingTel |
FY14 (Mar) |
22.92 |
16.8 |
$3.900 |
4.308% |
17.02 |
Interim 6.8ct ; Final 10ct |
|
M1 |
FY13 (Dec) |
17.4 |
21 |
$3.610 |
5.817% |
20.75 |
Interim 6.8ct ; Final 7.1ct + Special 7.1ct |
|
StarHub |
FY13 (Dec) |
21.50 |
20 |
$4.150 |
4.819% |
19.30 |
Q1 5ct ; Q2 5ct ; Q3 5ct ; Q4 5ct |
Infrastructure
|
Stock |
Period |
DPS cts |
Mkt |
Yield |
NAV |
Div Breakdown |
|
AusNet Services |
1H – Sep14 |
A4.18 (Gross) |
$1.420 |
6.371% |
A$0.86 |
1H15 A4.18ct ; 2H14 A4.18ct |
* SPAus DPU in A$. Yield is Calculated Using Latest Exchange Rate (1.0821) fm Yahoo
NOTES :
- Mkt Price is as on 31-Dec-14
- SATSvcs : 1H15 (Sep14) – Interim 5ct
- SingTel : 1H15 (Sep14) – Interim 6.8ct
- AusNet : 1H15 (Sep14) – A4.18ct = A2.2ct (Franked) + A1.98ct (Interest – Subject to 10% Tax) ; 2H14 (Mar14) – A4.18ct = A1.393ct (Franked) + A2.379ct (Interest – Subject to 10% Tax) + A0.408ct (Capital Returns)
- SingPost : Q215 (Sep14) – 1.25ct ; Q115 (Jun14) – 1.25ct
- StarHub : Q314 (Sep) – 5ct ; Q214 (Jun) – 5ct ; Q114 (Mar) – 5ct
- SIAEC : 1H15 (Sep14) – Interim 6ct
- SMRT : 1H15 (Sep14) – Interim 1.5ct
- SGX : Q115 (Sep14) – 4ct
- SPH : 2H14 (Aug) – Final 8ct + Special 6ct ; 1H14 (Feb) – Interim 7ct
- ComfortDelgro : 1H14 (Jun) –3.5ct
- ST Engg : 1H14 (Jun) – 4ct
- SBSTransit : 1H14 (Jun) – 1.25ct
- HLFin : 1H14 (Jun) – 4ct
- M1 : 1H14 (Jun) – Interim 7ct
- SPAus : FY15 Guidance = A8.36ct Gross
- ST Engg : Dividend Payout Reduced from 90% to 80% for FY13 & Will Be Further Reduced to 75% from FY14
- StarHub : FY14 Div Guidance – 5ct/Q
- SingTel : Div Policy – 60% to 75% of Underlying Net Profit
November 2014
Results Announcement
- 4 Nov 14 : SIAEC (1H15) – EPS 3.75ct vs 6.39ct (1H14) ; Div 6ct vs 7ct (1H14)
- 5 Nov 14 : Starhub (Q314) – EPS 5.7ct vs 5.5ct (Q313) ; Div 5ct (No Change)
- 6 Nov 14 : Singpost (Q215) – EPS 1.584ct ; Div 1.25ct
- 7 Nov 14 (AM) : STEng (Q314) – EPS 3.89ct vs 4.24ct (Q313)
- 7 Nov 14 : HLFin (Q314) – Annualised EPS 12.93ct
- 12 Nov 14 (AM) : AusNet (1H15) – Gross Div A4.18ct
- 12 Nov 14 : SBSTransit (Q314) – EPS 1.86ct vs 1.15ct (Q313)
- 13 Nov 14 (AM) : Singtel (Q215) – EPS 6.51ct vs 5.46ct (Q214) ; Div 6.8ct (No Change)
- 13 Nov 14 : ComfortDelgro (Q314) – EPS 3.78ct vs 3.61ct (Q313)
- 13 Nov 14 : SATS (Q215) – EPS 4.2ct vs 4.3ct (Q214) ; Div 5ct (No Change)
STI = 3350.50 (+9.54 ; +76.25 for the Month)
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
Hong Leong Fin |
FY13 (Dec) |
15.85 |
12.00 |
$2.580 |
4.651% |
16.28 |
Interim 4ct ; Final 8ct |
|
SGX |
FY14 (Jun) |
30 |
28 |
$7.320 |
3.825% |
24.40 |
Q1, Q2, Q3 4ct ; Q4 4ct +12ct |
|
SingPost |
FY14 (Mar) |
6.746 |
6.25 |
$1.930 |
3.238% |
28.61 |
Q1, Q2, Q3 1.25ct ; Q4 2.5ct |
|
SPH |
FY14 (Aug) |
25 |
21 |
$4.290 |
4.895% |
17.16 |
Interim 7ct ; Final 8ct + Special 6ct |
Note : SGX Added from May-14 ; Q4 Variable Div Depends on FY EPS
Aviation Services
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SATS |
FY14 (Mar) |
16.10 |
13.0 |
$2.930 |
4.437% |
18.20 |
Interim 5ct ; Final 8ct |
|
SIA Engineering |
FY14 (Mar) |
23.88 |
25.0 |
$4.110 |
6.083% |
17.21 |
Interim 7ct ; Final 13ct + Special 5ct |
|
ST Engineering |
FY13 (Dec) |
18.73 |
15.0 |
$3.370 |
4.451% |
17.99 |
Interim 3ct ; Final 4ct + Special 8ct |
Note : SIAEC Special Div is Observed to be Non-Recurring (Depends on Excess Cash)
Transport
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SBSTransit |
FY13 (Dec) |
3.62 |
1.80 |
$1.720 |
1.047% |
47.51 |
Interim 0.9ct ; Final 0.9ct |
|
ComfortDelGro |
FY13 (Dec) |
12.43 |
7.00 |
$2.600 |
2.692% |
20.92 |
Interim 3ct ; Final 4ct |
|
SMRT |
FY14 (Mar) |
4.10 |
2.20 |
$1.630 |
1.350% |
39.76 |
Interim 1.0ct ; Final 1.2ct |
TELCO
|
Stock |
Period |
EPS cts |
DPS cts |
Mkt |
Yield |
PE |
Div Breakdown |
|
SingTel |
FY14 (Mar) |
22.92 |
16.8 |
$3.900 |
4.308% |
17.02 |
Interim 6.8ct ; Final 10ct |
|
M1 |
FY13 (Dec) |
17.4 |
21 |
$3.640 |
5.769% |
20.92 |
Interim 6.8ct ; Final 7.1ct + Special 7.1ct |
|
StarHub |
FY13 (Dec) |
21.50 |
20 |
$4.140 |
4.831% |
19.26 |
Q1 5ct ; Q2 5ct ; Q3 5ct ; Q4 5ct |
Infrastructure
|
Stock |
Period |
DPS cts |
Mkt |
Yield |
NAV |
Div Breakdown |
|
AusNet Services |
1H – Sep14 |
A4.18 (Gross) |
$1.470 |
6.302% |
A$0.86 |
1H15 A4.18ct ; 2H14 A4.18ct |
* SPAus DPU in A$. Yield is Calculated Using Latest Exchange Rate (1.1082) fm Yahoo
NOTES :
- Mkt Price is as on 28-Nov-14
- SATSvcs : 1H15 (Sep14) – Interim 5ct
- SingTel : 1H15 (Sep14) – Interim 6.8ct
- AusNet : 1H15 (Sep14) – A4.18ct = A2.2ct (Franked) + A1.98ct (Interest – Subject to 10% Tax) ; 2H14 (Mar14) – A4.18ct = A1.393ct (Franked) + A2.379ct (Interest – Subject to 10% Tax) + A0.408ct (Capital Returns)
- SingPost : Q215 (Sep14) – 1.25ct ; Q115 (Jun14) – 1.25ct
- StarHub : Q314 (Sep) – 5ct ; Q214 (Jun) – 5ct ; Q114 (Mar) – 5ct
- SIAEC : 1H15 (Sep14) – Interim 6ct
- SMRT : 1H15 (Sep14) – Interim 1.5ct
- SGX : Q115 (Sep14) – 4ct
- SPH : 2H14 (Aug) – Final 8ct + Special 6ct ; 1H14 (Feb) – Interim 7ct
- ComfortDelgro : 1H14 (Jun) –3.5ct
- ST Engg : 1H14 (Jun) – 4ct
- SBSTransit : 1H14 (Jun) – 1.25ct
- HLFin : 1H14 (Jun) – 4ct
- M1 : 1H14 (Jun) – Interim 7ct
- SPAus : FY15 Guidance = A8.36ct Gross
- ST Engg : Dividend Payout Reduced from 90% to 80% for FY13 & Will Be Further Reduced to 75% from FY14
- StarHub : FY14 Div Guidance – 5ct/Q
- SingTel : Div Policy – 60% to 75% of Underlying Net Profit