SG Market (14 May 15)

Regional bourses are trading lower this morning in Tokyo (-0.2%) and Sydney (-0.5%), but flat in Seoul.

From a chart perspective, the STI may continue to struggle around the 50-dma at 3,450 with resistance seen at 3,520 and downside support at 3,360.

Stocks to watch:
*SingTel: 4QFY15 results largely in line, as net profit climbed 4.5% to $938.8m, taking FY15 net profit to $3.78b (+3.5%). Revenue for the quarter climbed 5.1% to $4.34b, driven by its consumer segment (+6.3%) mainly on growth in equipment sales, mobile communications and consumer home services, but contribution from enterprise segment fell 0.4% from the transfer of the fibre rollout business to NetLink Trust from Oct '14. Bottom line was boosted by higher share of associate income (+13%) and lower share of exceptional items (-45%) from Bharti Airtel and Globe. Final DPS of 10.7¢, taking FY15 total to 17.5¢ (FY14: 16.8¢).NAV/share of $1.55.

*GLP: 4QFY15 results below estimates, as net profit slumped 34.5% y/y to US$104.9m, taking FY15 net profit to US$486.2m (-29%). Revenue for the quarter climbed 6.2% to US$166.8m, led by the completion of development projects and higher rents in China, and the inclusion of management fees revenue from GLP US Income Partners I, but partially offset by loss of contributions from 11 properties sold to GLP J-REIT and the weakening of JPY against USD. Bottom line weighed by fair value losses from investment properties in Brazil JVs (-US$26.6m) arising from capitalisation rate expansion, as well as higher property-related expenses (+18.7%) from an increased leasable area and higher staff and business costs (+21.2%). First and final DPS of 5.5¢ declared (FY14: 4.5¢). NAV/share of US$1.81.

*City Dev: 1Q15 results in line, with net profit of $123.0m (+2.8%) on revenue of $814.9m (+11%). Top-line was led by contributions from property development projects such as Coco Palms, D’Nest and Jewel @ Buangkok, as well as higher hotel revenue driven by new hotels acquired in 2014, coupled with better performance from refurbished hotels. Gross margin fell to 45.5% from 48.3%. Bottom-line was weighed by higher admin expenses (+13.8%), other operating expenses (+15.5%) and taxes (+71.6%), partially offset by higher associate and JV contributions (+160%). Net gearing of 27% and NAV/share of $9.43.

*ComfortDelgro: 1Q15 results in line. Net profit increased 6.8% to $67.6m, while revenue inched up 1.3% to $963.5m, with growth in most segments, particularly in the Taxi (+5.2%), Bus (+2.2%) and Rail businesses (+8.1%). EBITDA margin improved to 20.2% from 19.6%, aided by lower fuel and electricity costs and lower insurance premiums and accident claims. NAV/share of $1.06.

*Yanlord: 1Q15 results below estimates, as net profit plunged 94% to Rmb15.5m on revenue of Rmb1.01b (-43%). The lower top-line was due to lower GFA being delivered to customers in the quarter, partly offset by the recognition of resettlement service fee income. Gross margin was higher at 42.7% in 1Q15 as compared to 36.3% in 1Q14 primarily due to the recognition of the resettlement service fee income. Bottom-line weighed by a 77% rise in admin expenses to Rmb239.4m, largely weighed by FX losses, while JV losses came in at Rmb1.9m versus contributions of Rmb99.6m. NAV/share of Rmb9.88.

*SATS: 4QFY15 results above. Net profit gained 21.1% to $51.6m taking FY15 net profit to $195.7m (+8.5%), with earnings boosted by lower cost of raw materials (-8.5%), depreciation charges (-9.4%) and other costs (-16.5%) and share of profits from associates/joint venture (+32.3%). Revenue for the quarter fell 2.2% to $425.1m, with food solutions (-5.8%) and gateway services (+3.5%). Final DPS of 9¢ declared, bringing FY15 DPS to 14¢ (FY14: 13¢). NAV/share of $1.30.

*SIIC: 1Q15 results in line, with net profit of Rmb68.4m (+7.5%) on revenue of Rmb374.0m (+6.8%). Topline was led by growth from all segments, except the construction segment (-9.8%), due mainly to relatively lower amount of construction activities in progress in 1Q15 versus the previous year. Gross margin was relatively stable at 40.5% (1Q14: 39.7%). Bottom-line was weighed by a 61.4% rise in tax expenses to Rmb25.2m, as there was no write-back of over-provision of tax this quarter. NAV/share of Rmb0.391.

*Nam Cheong: 1Q15 results below estimates, with net profit of RM39.3m (-45%) on revenue of RM326.3m (-20%). Top line was weighed by lower shipbuilding revenue (-19%) as a result of lesser vessels being delivered, as well as lower vessel chartering revenue (-32%), due to lower vessel utilisation rate. Gross margin relatively unchanged at 20.9% (1Q14: 21.2%). Bottom-line weighed by higher selling and admin expenses (+30%) and higher finance costs (+94%). NAV/share of RM0.63.
*Innovalues: 1Q15 results above estimates. Net profit surged 110% to $5.5m, from revenue of $29.1m (+19%), comprising automotive of $23.2m (+18%) from increased orders from customers in US and China, office automation of $5.7m (+22%) and others of $0.2m (+317%). Gross margin expanded 8.3ppt to 31.0% from a favourable sales mix and improved operational efficiency. NAV/share of $0.244.

*Breadtalk: 1Q15 results in line. Net profit rose 10.9% to $2.0m on revenue of $152.5m (+8.6%). Topline was led by increases across all divisions, namely bakery division (+7.8%) and the restaurant division (+13.2%). Gross margin was relatively stable at 51.6%. Other income was up 29.5% to $4.5m due mainly to receipts under the Singapore's Wage Credit Scheme. NAV/share of $0.375.

*Fu Yu: 1Q15 swung to net profit of $4.0m versus a net loss of $1.4m from the previous year, while revenue fell 2.3% to $58.1m mainly from decreased revenue in Malaysia from lower contract manufacturing, partially offset by increases in revenue in China and Singapore. Gross margin improved 5.9ppt to 14.8% from better product mix, stronger USD, and decreased depreciation. Bottom line was buoyed by FX gains and associate contributions. NAV/share of $0.241.

*Oxley: 3QFY15 net profit spiked to $11.9m (3QFY14: $1m), on a 48% y/y surge in revenue to $152.2m, derived from progressive revenue recognition in the construction of 11 mixed-residential projects. Gross profit margin grew 8ppt to 29.8%. NAV/share of $0.1539.

*Ramba: 1Q15 net loss narrowed 39.6% to $1.4m, while revenue inched 0.7% higher to $17.3m, due to lower gas production from natural decline and absence of a government grant this year. Net loss narrowed mainly due to the restructuring of the chemical logistics business, continued cost control, and favourable FX gain. NAV/share of 17.6¢

*Dynamac: 1Q15 net profit fell 77.5% to $1.6m, while revenue plunged 49.5% to $39.8m, as ongoing projects were mainly in the initial stage of production. Gross margin improved 14.6ppt to 36.6% mainly from cost saving from finalizing a few projects. Bottom line weighed by a $2.6m USD hedging loss.

*JB Foods: 1Q15 net loss narrowed to US$0.5m from US$2.7m on revenue of US$42.1m (-21%). The decline in revenue was mainly attributed to the decrease in product shipment volume and average ASP of cocoa ingredient products in 1Q15. The positive gross profit of US$1.2m (1Q14: gross loss of US$1.1m) was driven by more favourable ASP of the products delivered when compared to the unit inventory carrying costs and the absence of inventory written down in the current quarter. NAV/share of US$0.083.

*ISEC: 1Q15 net profit fell 11% to $757m, while revenue jumped 39% to $6.4m, mainly due to the inclusion of Singapore operations, and the increased number of patient visits in Malaysia operations. Bottom line drag largely came from increased operating expenses related to the Singapore operations. NAV/share of $0.10