HLH

HLH: 1Q14 net profit surged to $42.9m (1Q13: net loss of $1.5m), boosted by a one-off revaluation gain of $50m on its investment properties in Cambodia. On a core basis however, the group would still have been marginally loss making. Revenue nearly tripled to $2.9m, as the group held back on dry corn sales the previous year to achieve better prices, as well as cooperation income of $1m arising from joint operations with Zhong Fu Int’l Investment in 1Q14. Accordingly, the group swung to a gross profit of $0.9m from slightly negative a year ago. To date, the group has completed clearing 9,700 ha of land and construction of four farm plantations in Cambodia. Management expects to clear the remaining 300 ha before year end. Meanwhile, HLH has commenced a new mode of joint operations with partners on cassava (or maize and sugarcane) farming in its own plantation land. The group is also seeking partners from the agri industry for its farm resort in D’Kranji with the aim to attract more visitors. For property development, the group is actively looking at potential land parcels within the vicinity of Phnom Penh City. Balance sheet is decent, backed by net cash of $5.8m. At 1.9¢, HLH trades at 0.8x P/B.