United Envirotech: enters into purchase agreement with KKR for the proposed issue of US$113.8m in 5-yr convertible bonds. The bonds pay 2.5% pa, and come with a conversion price of $0.45/sh (28.6% above last traded at $0.35). If fully converted, the CBs will make up 38.4% of the expanded share base.
At least 90% of the proceeds will be used to fund its Transfer-Operate-Transfer (TOT), Build-Operate-Transfer (BOT) and Build Own and Operate (BOO) projects, with the remainder used for working capital.
The agreement is subject to sh/h approval. Nevertheless expect positive reaction to the stock. In the wake of the recent corporate governance concerns surrounding the S Chips, KKR’s investment may be seen as a vote of confidence in the co.
Stirling Coleman is the arranger for the transaction, Credit Suisse is advising KKR.
Stock trades at 10.6x P/E.
DMG, OCBC had Buy ratings with TP of $0.53/0.54, last updated in May.
Monday, August 1, 2011
Tiger Air
Tiger Air: says it has jointly applied with Australia's Civil Aviation Safety Authority to further adjourn an Australian Federal Court proceeding to Aug 3 from Aug 1 on the suspension of its operations. As a result, Tiger's Australian operations will remain suspended until at least Aug 3; moreover it has promised refunds for all passengers booked to fly btwn Aug 1-4.
The regulator had applied to the courts early last month to seek an extension to the period of suspension of Tiger Australia's flights to Aug 1. The court hearing was originally scheduled to take place July 28 but was subsequently pushed back to Aug 1.
The airline also said certain press reports that Tiger Australia flights will re-commence on Aug 5 "are speculation", without specifying the reports it was referring to acting CEO Chin Yau Seng also told the Straits Times yday that he didn’t rule out a possible downsizing of Tiger Australia’s operations.
With no clear timeline as to when Tiger Australia would resume operations, expect the share price (which has returned to pre-flight suspension levels) to remain volatile.
The regulator had applied to the courts early last month to seek an extension to the period of suspension of Tiger Australia's flights to Aug 1. The court hearing was originally scheduled to take place July 28 but was subsequently pushed back to Aug 1.
The airline also said certain press reports that Tiger Australia flights will re-commence on Aug 5 "are speculation", without specifying the reports it was referring to acting CEO Chin Yau Seng also told the Straits Times yday that he didn’t rule out a possible downsizing of Tiger Australia’s operations.
With no clear timeline as to when Tiger Australia would resume operations, expect the share price (which has returned to pre-flight suspension levels) to remain volatile.
Healthway
Healthway: Wins mental health screening tender from Health Promotion Board. Co will conduct mental health screenings for elderly residents in this pilot initiative at seven community locations including Hougang, Woodlands and Choa Chu Kang. No mention of amount as of yet.
Interra
Interra: JV 60% owned Goldpetrol has commenced drilling on well CHK 1162 and production has stabilised at avg of 50 barrels of oil per day
Kreuz
Kreuz: 2Q Rev at US$54.4m +291.8% yoy +108.3% qoq with net profit of $14.0m, a fivefold increase, +551.7% yoy +144.0% qoq. Existing and new projects evenly from related companies and third parties projects were the reason for revenue increase in 2Q2011 and higher margins contributed to bottom line performance. Of note, trade receivables rose over 2 fold from $31.9m to $70.2m, although not a cause for concern as receivables have been rising in line with the revenue. Current order book of US$115.0m slightly up from prev quarter $110.0m. 2Q EPS of 2.75c, with annualized P/E of 5.0x, co has been recovering from a low posting quarter on quarter growth in rev and profit.
Fraser Commercial Trust
Fraser Commercial Trust: Announced 3Q11 results which was in-line.
Net Property Income at $24.9m, +10% yoy and +4.6% qoq, while distributable income at $8.7m, +13% yoy and -13% qoq.
Results driven by strong asset performance from KeyPoint and Aus properties, resulting in increase in NPI for last two qtrs, on back of rising occupancy and higher rentals. REIT also divested investment in the Australian Wholesale Property Fund and proceeds used to repay part of existing AUD loan resulting in interest savings. The full effect of the partial repayment would be seen in coming qtrs.
Operationally, average occupancy rates remain robust at 97.6% underpinned by healthy occupancy rates for SG and Aus portfolios of 97.3% and 99.9% respectively, while New leases commenced in the qtr include foreign mid-sized companies such as KHS Asia and Expereo. In Japan, occupancy rates remain at a healthy level of 93.0%. Only 3.1% of gross rental income due for renewal in FY11 in FY11 and Wale stood at a comfortable 3.8 yrs.
At current price, valuations are very compelling, with grp trading at 0.63x P/B and annualized FY11 yield of 6.5% (vs peers average of 0.8xP/B and 5.7% yield), while Leverage ratio stood at an acceptable 34.7% suggesting further headroom for debt raising.
Net Property Income at $24.9m, +10% yoy and +4.6% qoq, while distributable income at $8.7m, +13% yoy and -13% qoq.
Results driven by strong asset performance from KeyPoint and Aus properties, resulting in increase in NPI for last two qtrs, on back of rising occupancy and higher rentals. REIT also divested investment in the Australian Wholesale Property Fund and proceeds used to repay part of existing AUD loan resulting in interest savings. The full effect of the partial repayment would be seen in coming qtrs.
Operationally, average occupancy rates remain robust at 97.6% underpinned by healthy occupancy rates for SG and Aus portfolios of 97.3% and 99.9% respectively, while New leases commenced in the qtr include foreign mid-sized companies such as KHS Asia and Expereo. In Japan, occupancy rates remain at a healthy level of 93.0%. Only 3.1% of gross rental income due for renewal in FY11 in FY11 and Wale stood at a comfortable 3.8 yrs.
At current price, valuations are very compelling, with grp trading at 0.63x P/B and annualized FY11 yield of 6.5% (vs peers average of 0.8xP/B and 5.7% yield), while Leverage ratio stood at an acceptable 34.7% suggesting further headroom for debt raising.
SG Market
SG Market: Spore shares are tipped to open higher amid late-in-the-day progress on a deal in Washington to avert a US debt crisis. Mkts on Wall Street ended lower Fri, but Dow futures are currently around 150 points higher amid news that US Republican leaders have tentatively agreed on a deal to raise the US debt ceiling, pending acceptance from the party's rank-and-file lawmakers.
The local mkt is tipped to react positively, just due to lower uncertainties than previously. STI support eyed at 3200; beyond there, we'll be looking at 3280 resistance, which was the Jan high. Courage Marine may fall after saying it expects to post a net loss for 1H11, compared to a profit yoy.
The local mkt is tipped to react positively, just due to lower uncertainties than previously. STI support eyed at 3200; beyond there, we'll be looking at 3280 resistance, which was the Jan high. Courage Marine may fall after saying it expects to post a net loss for 1H11, compared to a profit yoy.
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