Thursday, February 7, 2013

King Wan Corp

King Wan Corp: Reported in-line 3Q13 results. Revenue fell 25% y/y to $11m, GPM soared from 22% to 31%, as work was performed on higher margin private residential projects. The bottom line fell 75% to $1.7m as about $2.5m of Thai Associate income are no longer equity-accounted after their sale to KTIS in Thailand for a massive gain equivalent to about 2.5 years of core profits. The $167m order book is equivalent to three years' work, supporting the core 1.5¢ dividend. OSK DMG continue to expect special dividends of 1.5¢ from the sale of the Thai Associates over the next 10 years, raising the yield to 9.7% for the next 10 years. OSK DMG maintains BUY with TP of $0.40, based on 7.5% yield.

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