Venture

Venture: 4QFY13 net profit was in line with consensus as it remained flattish (+0.1% y/y, +8.4% q/q) at $38m while topline inched higher by 5.1% y/y (5.8% q/q) to $622.8m, the highest quarterly revenue for the year. This brings full year revenue to $2.3b (-2.4%) and net profit to $131.1m (-6.1%). For the year, Group managed to increase market share and win new programmes from most existing customers, although volumes from some declined, particularly those affected by M&A. CS highlights signs of Venture’s net profits bottoming out as profits showed 3rd consecutive y/y decline, but grew y/y consecutively for 2 quarters. Management is positive on topline recovery in FY14 on : 1. The positive outlook from most customers across almost all segments 2. An increase in profit contribution from new customers won over the past few years 3. Venture's continued focus on margins and winning high quality customers. First and final DPS of 50¢ proposed, implying yield of 7%. That said, payout ratio beyond 100% for the first time, CS thinks sustainability of payout is at risk but FY14 dividend cut is unlikely on strong operating cashflows. Venture is trading at 13.3x trailing P/E at yesterday’s closing price CS maintains Neutral with Venture on lack of catalysts, with TP shaved to $7.40 (from $7.70)