SingPost

SingPost: 4QFY15 results in line, with core net profit of $41.1m (+14.9%), taking FY15 core net profit to $157.2m (+5.2%).

Revenue for the quarter rose 28.7% to $248.7m, led by growth in the logistics (+72.5%) and retail & ecommerce (+9.1%) segments. Revenue in logistics segment grew strongly on higher ecommerce logistics contributions and the inclusion of new subsidiaries, while retail & ecommerce revenue was led by the growth in ecommerce services. Excluding the impact of M&As, revenue grew 1.6%.

Mail revenue was flat at $123.5m, as the business continued to record declining traditional letter mail volumes, offset by the introduction of new products and postage rate increase which took effect in Oct ‘14.

Total expenses rose 33.9% to $35.7m, largely attributable to the inclusion of new subsidiaries, and the group’s continued investments in its transformation initiatives and service quality improvements.

Bottom-line saw minimal far value gains of $5.2m versus $44.5m from the previous year, due to SingPost changing its accounting policy for investment properties to the fair value model from the cost model. Meanwhile, associate and JV contributions rose 75.9% to $3.4m,

Going forward, the group highlighted that M&As will continue to be part of its growth strategy to build scale and secure its “first-mover advantage”, and added that the pace of innovation driven by global ecommerce mega-trends appear set to intensify further.

Balance sheet remains strong, with the strong in a net cash position of $345.8m, representing 16.1¢ per share.

Proposed first and final DPS of 2.5¢, which is unchanged from the previous year.

Latest broker ratings:
CIMB maintains Hold with TP of $2.05 (prev. $2.08)
OCBC maintains Buy with TP of $2.19
UBS maintains Neutral with TP of $2.20
UOB Kay Hian maintains Buy with TP of $2.27

10:49:57 AM: Bobby Lu Zhishen:
#Golden Agri: The integrated plantation group reported sharply lower 1Q15 net profit of US$17.2m (-83.5% y/y). Stripping out FX losses and fair value gains, core earnings sagged 48.3% to US$52.0m, forming 19% of full year consensus forecasts.

Revenue fell 18.9% to US$1.54b dragged by weakness across its three major segments, while EBITDA margin was trimmed 8.1% from 10.5%.

Revenue for the palm and laurics division fell 14.4% to US$1.4b, which was in line with lower CPO prices, despite higher volumes sold. EBITDA margin for the segment dipped slightly to 1.5% from 1.8%.

Upstream plantations and palm oil mills revenue (-32% to US$340.9m) saw weakness from lower CPO prices (-26.5% to US$865 per ton for average international CPO), and lower fresh fruit brunches and CPO production output at 2,114,000 tons (-5.7%) and 634,000 tons (-8.2%) respectively, which was affected by dry weather conditions experienced in certain regions of Indonesia. EBITDA margin for the segment fell to 29.5% from 34.2%

The oilseeds segment saw revenue down 36.2% to US$134.5m, mainly weighed by lower ASPs and crushing volume. Conversely, the segment recorded a positive EBITDA of US$2.3m as compared to a negative EBITDA of US$3.3, led by improvements in crushing margin.

Core operations aside, the group booked FX losses of US$35.0m versus a gain of US$3.2m from the previous year, due to the depreciation of the Rupiah versus the USD and fair value loss on forward foreign currency contracts. Bottom-line was partially buoyed by other operating income of US$11.7m (+180.2%), led by fair value gains of financial assets.

Going forward, the group will focus on improving its yield and cost efficiency, as well as optimising the integration of its downstream value chain. The operating environment for the oilseeds segment is expected to remain challenging, and the group will continue to review its business strategy to improve operating performance.

Balance sheet remains comfortable with adjusted net gearing of 0.20x and supported by positive operating cash flows.

The stock is trading at 15.7x forward P/E and 0.48x P/B.

Latest broker ratings:
CIMB maintains Hold with TP of $0.44
Goldman Sachs maintains Neutral with TP of $0.43
OCBC downgrades to Sell with TP of $0.35 (prev. $0.42)