Venture Corp

Venture Corp: Weak set of1Q13 results which was below expectations. The group saw a rev at $530.5m, -8% y/y and -10 % q/q and a -21% y/y fall in net profit to $28m for 1Q13, where it saw earnings decline across most of its segments, as well as other factors including an income tax expense and a lower share of profit of associate. Ventures rev dropped q/q across nearly all major segments with: 1) Printing & Imaging -36.8% q/q to $63.7m; 2) Computer peripherals & Storage -11.9% q/q to $64.2m; 3) RSS & Industrials segment -7.5% q/q to $169.4m; and 4) Networking & Communication segment -5.5% q/q to $86.4mn. 5) The only segment to see a revenue growth was T&M, Medical & Others which +1.6% q/q to $146.8mn. Venture said that the operating environment for the global electronics industry remains challenging and that there is still no clear sign that customers' end market is staging a strong recovery in the near term. Going forward, grp aims to sharpen its focus on increasing its market share from existing customers and winning new programs and customers. It will also continue to consider strategic investments that meet its longer-term objectives. The group remained net cash positive at $294.1m as at March 31. At current price, grp trades at an attractive 6.6% div yield. Ratings as follows: Nomura maintains Buy with $9.20 TP OCBC downgrades to Hold from Buy with $8.00 TP Venture downgrades to Hold from Buy with $8.58 TP Maybank-KE downgrades to Sell with $6.70 TP