Sin Heng

Sin Heng: Good set of 1Q13 results. Rev at $43m, +35.5% yoy and +11.1% qoq, while net profit at $3.3m, +106.1% yoy and -10.8% qoq. Gross margins at 16.7% vs 15.1% yoy, mainly due to improved contribution from subsidiaries, expanded fleet size and improvement in rental rates. Strong rev was mainly due to increase in both rental and trading rev. Rev from equipment rental business +47.3% yoy to $13.1m in due to improved contributions from overseas subsidiaries, expanded fleet size in Grp and improvement in rental rates. Rev from Trading business +31.0% yoy to $29.9m due to higher vol of smaller tonnage cranes traded, on back of strong demand in the regional mkts. Going forward, grp note that while the local business and global trading environment remains challenging, the regional key markets in which the Group operates appear to remain encouraging. With the coming on board of new shareholder Toyota Tsusho, Grp will work to explore further synergies in growing and expanding the business. Overall fundamentals strong, with net gearing at 31.6% and at current price, grp trades at an annualized 7x FY13E P/E.