Boustead Singapore

[greengiraffe]

Something could well be brewing at Boustead even though the contract secured so far are the bread and butter type.

New orders won so far had been significantly lower than last year:
Total new orders (as per investor day - 12 Dec 12): $159
Last year total new orders: $396

BP new orders (as per 28 Jan 13): $ 88
BP last year orders: $ 246
Even lower than the recent bad year (FY11): $142

Competition is getting very very tough ya?
Recent Pratt & Whitney facility in SAP also not won by them.
Supply Chain City which I was hoping that they will get involved also no news.

Googled Supply Chain City and ended at the following:

http://www.supplychaincity.com/

Looks pretty impressive leh and there is even a countdown timer on the web page...

Wah if Boustead Projects can be involved in the project, order books can definitely be lifted further.

HUATppy New Year

[wee]

http://www.supplychaincity.com/

Looks pretty impressive leh and there is even a countdown timer on the web page...

Wah if Boustead Projects can be involved in the project, order books can definitely be lifted further.

Seems like the project has ground broke already. Chances are the builders are already in place?

[greengiraffe]

Huatppy start for Boustead to Year of Water Snake. Even the water division has yet to start flowing for the group, the rest of the group appears to be causing a flood in Boustead earnings.

On a more serious note, it seems that it is the first time ever as far as I can recollect that Boustead has confidently exceeded previously year earnings before the financial year has closed.

http://info.sgx.com/webcoranncatth.nsf/V...10035FCE6/$file/Boustead_SGXNet_Announcement-3Q_FY2013-13.02.2013.pdf?openelement

http://info.sgx.com/webcoranncatth.nsf/V...10035FCE6/$file/Boustead_Media_Release-3Q_FY2013_Financial_Results_Announcement-13.02.2013.pdf?openelement

Mr Wong added, “Our focus continues to be on building up the order book backlog for
FY2014. In addition, we are continuing to explore all available avenues for growth
through M&A activities, and to deploy our strong cash position.”

What say you buddies?

[shanrui_91]

didn;t have time to fully digest the result yet but it seemed like there is a "$5.8 million gain on disposal of an available-forsale
investment and a $3.4 million income tax refund."

just wondering which equity investment did Boustead manage to sold off for $13m and earn a $5.8 million gain?

[Musicwhiz]

The Straits Times
www.straitstimes.com
Published on Feb 14, 2013
Boustead's Q3 net profit surges 373%

A TAX refund and a one-off gain helped Boustead Singapore record a bumper net profit for its third quarter.

Net earnings came in at $26.2 million for the three months to Dec 31, up 373 per cent on the $5.5 million recorded in the same period the year before.

The firm made a $5.8 million gain from the disposal of an investment and received a $3.4 million income tax refund within the quarter.

Revenue rose 49 per cent year-on-year to $141.5 million.

Boustead noted that all four of its core operating divisions were profitable, led by the strong performance of its real estate solutions division, which saw revenue more than doubled from a year ago to $77 million.

"The division's strong quarterly performance was due to the satisfactory completion of projects from the sizeable order book backlog of design- and-build projects carried through from financial year 2012," the firm said.

Revenue at its energy-related engineering division grew 13 per cent year-on-year, while sales at the geo-spatial technology wing rose 9 per cent.

However, revenue at the water and wastewater engineering unit fell 23 per cent as the firm implemented fewer projects in this area.

Chief executive Wong Fong Fui said the company expects full-year net profit to significantly surpass that of 2012.

"Our focus continues to be on building up the order book backlog for financial year 2014. In addition, we are continuing to explore all available avenues for growth through merger and acquisition activities, and to deploy our strong cash position," he said.

The order book backlog stands at $340 million, a significant increase over the $288 million stated in the second quarter.

This growth has been driven by the real estate solutions division, which has secured $144 million in new contracts since October, the firm said.

Earnings per share came to 5.2 cents for the quarter, up from 1.1 cents a year earlier, while net asset value per share was 53.8 cents, up from 50.4 cents at the end of its 2012 financial year.

YASMINE YAHYA

(Vested)

[greengiraffe]

Boustead share price broke out of its all-time high in a spectecular chart breakout formation today.

With a low of $1.265, the share price left behind a breakaway gap from the all-time high of $1.255.

The most powerful way ahead will be for the share price to keep heading north without retracing to cover the gap at $1.255 - $1.265.

With my basic chart knowledge, I stand by my prediction of a target price of $1.625 in 27 months time and $2.10 in 37 months.

Vested

[Contrarian]

My biggest regret is not doubling my bet to make it 15% of my overall holding when it was 80ct.
The business is not an easy business but the management made it into a super performer.

I classify it as a pillow stock. Similar to dairy farm...

[Musicwhiz]

Interesting that people are now so bullish on Boustead. This has been a good yielder for me over the years, and I've been holding on to its shares since Sep 2006. Added a little more during Oct 2008 and March 2009, then again in late-2011.

I am observing if their GPM may be adversely affected moving forward, which is a negative they highlighted in the announcement. Other than that, cash flows are very strong and FCF generation is healthy. I do look forward to the upcoming final dividend of 3c/share come May 2013 (and hopefully I also get a pleasant surprised!).

[greengiraffe]

Hi MW,

I have been in Boustead one mkt cycle longer than you. I started investing in Boustead since 2002 when it took a stake in ill fated Salcon. Unfortunately, Salcon did not made it to the big league and Boustead spent years stemming the red ink till Salcon is a pale shadow of what it is presently.

Since GFC, Boustead has been quietly transformed. Recurrent earnings have been steadily built up from ESRI and the portfolio of ind properties. Net income from ESRI and the rental income is estimated to contribute between S$35m to $40m per annum. The rest of the contribution will come from project wins by B Project's design and build business, Oil & Gas and the Water division.

There is no doubt that competition is rising in design and build. But with expected increase in population, density in Singapore is set to increase and B projects can be expected to be an active player in the renewal of aged ind properties. The Oil and Gas division should get its fair share of projects from US's shale gas boom and perhaps the troubled Water division may get some positive surprises.

All these excludes the net cash hoard of S$179m and a liquid investment portfolio of S$57m. The cash hoard is presently earning next to nothing. Should Boustead be successful in investing the cash hoard to secure a recurrent income stream, earnings quality at Boustead will be enhanced.

Compared to few years ago where earnings quality is not a match to current levels, it is not difficult to see the excitement. Boustead has steadfastly focused not only on accounting earnings but also generated high quality cashflows that supported accounting profits. The rising share price reflected the long term earnings uptrend.

Just as management is optimistic over its prospects, as a long term shareholder I am equally happy and excited by the team's execution capability. I am looking forward to a raise in ordinary dividend levels that may be further supplemented by a special.

If we get a total of 4 cents final with a special of 1 cent, then total DPS this year may reach 7 cents, still a decent 5% yield even if share price reaches $1.40 when final results are in.

Vested

Interesting that people are now so bullish on Boustead. This has been a good yielder for me over the years, and I've been holding on to its shares since Sep 2006. Added a little more during Oct 2008 and March 2009, then again in late-2011.

I am observing if their GPM may be adversely affected moving forward, which is a negative they highlighted in the announcement. Other than that, cash flows are very strong and FCF generation is healthy. I do look forward to the upcoming final dividend of 3c/share come May 2013 (and hopefully I also get a pleasant surprised!).

[Musicwhiz]

Hi GG,

Thanks for recounting your long experience with Boustead, and it is indeed good to know of someone who has been a shareholder for the past 11 years.

No doubt what you said is very true, Boustead has steadily transformed itself after the GFC with FF Wong's commitment to finding investment opportunities for the cash and to build up Boustead Project's DB&L portfolio. What I do find puzzling, however, is their doggedness with regards to Salcon. As you yourself mentioned, it is a pale shadow of what it used to be and even after legacy issues were cleared up in recent years, the division has difficulty pulling in a decent profit; and has been a drag to the Group. I seriously hope FF Wong can give a good explanation for holding out with Salcon for so many years, even when it is becoming increasingly apparent that Salcon is not a good idea!

Wow you must have held Boustead through the Easycall cum China Education days, and seen the dividend in specie offered by Boustead of Easycall shares which then went up 10x after the privatization offer! That was a good deal I missed out as I only bought in late-2006.

As for real estate, now that D&B will be more competitive and projects harder to come by, I am not sure if they can easily grow this division consistently. While it is true that they have recurring income from their current stable of DB&L projects, it has been increasingly tough for Boustead to secure more of such contracts to add to their recurrent income. I suspect FF Wong may need to pull another rabbit out of the hat to ensure the cash hoard does not just lie around earning next to nothing.

True, Geo-Spatial is the under-stated winner for Boustead, and seeing PBT increase about +20% for 9M 2013 is indeed pleasing and encouraging. This division has never failed to grow every single year and brings in most of the FCF for Boustead Group.

Currently, Boustead has a few investments on its plate; namely Hankore (which just announced decent results today), OMH (still in limbo regarding the Sarawak Smelter) and the most recent integrated development in Tongzhou district in Beijing with Perennial Real Estate. Whether these eventually bear fruit remains to be seen, but my concern is whether Boustead may stray too far from its core competencies in their pursuit for "growth" and "returns". As a shareholder I hope to be able to articulate these concerns to Management and receive a satisfactory answer. The litigation in Libya is also another wild card and would represent a bonus of sorts if they won it as the amount had already been written off.

Regards.