Breadtalk

Breadtalk: Good set of results which were above estimates. Grp registered a 19.1% YoY and 5.7% increase in 4Q12 revenue and operating profit to $119.7m and $6.5m respectively on the back of higher same-store sales across all business segments. Although these results exceeded forecast, the group’s operating and net profit margins declined as expected following greater cost pressures. In line with its expansion phase, BreadTalk declared a lower final div to bring the total div declared in FY12 to 1.3c (FY11: 1.5c). Going forward, adjusted FY13/14 forecasts upwards to account for full yr contributions from new stores but remained lukewarm on possible margin improvements as the group’s continued expansion push makes the scenario unlikely. OCBC lower rolling 12-month EPS peg to 15.5x (from 19x) but keep fair value estimate at $0.77. Maintain HOLD