Centurion

Centurion: FY13 net profit soared 506% to $92.2m, while topline inched up 2% at $66.4m. 4Q13 net profit spiked 422% y/y to $26.9m, while revenue remained flattish at $17.6m, as accommodation business which grew 20% was offset by a 30% reduction in optical disc business. Gross margins improved to 55% from 50% as in line with the higher-margin accommodation business growth. Bottomline was buoyed by share of associates of $16m (vs $2.5m loss in FY2012), contributed by the worker’s dormitory in Mandai, which had a fair value gain of $14.7m on its investment property. Final DPS of 0.6¢ declared (vs 0.7¢ for FY2012). Outlook for the accommodation business for the next 12 months is promising. 1) Singapore - Occupancy is expected to be full/ near full. Toh Guan dormitory, which increased bed capacity to 8,600 beds had received its TOP in Jan’14. In addition, profit from sale of factory units, a 45% JV with Lian Beng is expected to be booked in 1Q14. 2) Malaysia – occupancy is now an average of 80% vs management’s previous guidance of 70%. Centurion has 13,500 beds in Malaysia. Occupancy rates are expected to improve 3) RMIT Village – acquisition completed. With full occupancy of 456 beds, occupancy is expected to remain full and contribute positively towards FY14. Centurion is trading at 1.6x P/B