Wednesday, February 6, 2013

Hafary

Hafary: 1H13 revenue increased 31% to $42.4m, driven by an across-the-board increase in sales contributed by its two business segments– General (including home-owners, architecture, interior design and renovation firms) and Project (including architecture firms, property developers and construction companies). Notes the projects which includes NUH, Fullerton Hotel and IMM Building. Also, the Group also commenced delivery of surfacing materials for use in a number of HDB residential estate developments under the Build-To-Order Scheme. Net profit increased by 850% to $23.9m for 1H13. The increase was due primarily to recognition of a one-time gain on disposal of development property at 79 Aljunied Road amounting to $23.8 million. Dividend grew 150%, with a dividend of 2.5 cents per ordinary share was announced, implying an annualised yield of 9.3%. For 1H12, Hafary paid its shareholders a dividend of 1.0c per ordinary share. Mgmt stated that Hafary has progressively strengthened its market position in Singapore, while building its base to leverage on demand in high-growth markets such as China and Vietnam. Going forward, the completion of new warehouse facility at 3 Changi North Street 1 will help the Group streamline its logistical functions, thereby decreasing costs in rental, manpower and transport, increasing the cost efficiency of the Group. Company also proposed placement of up to 20m new ordinary shares at $0.294/ share. Placement price is 9.5% of last closing price. The aggregate Placement Shares represent approximately 10.3% of the existing shares of the Company as at the date of this announcement, and approximately 9.3% of the enlarged share capital. Proceeds of the placement will be for redevelopment of the property at 18C Sungei Kadut Street 4, of approximately $2m (34.5% of the Net Proceeds) for the storage of marble and stone materials, and the rest for general working capital. Hafary trading at 2.4x P/E, P/B of 1.2x.

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