TeckWah

After sitting quietly at 32 to 34 cents for 3 months, suddenly today there is a relatively big buy queue (by Teckwah standards) at 34.5, with only a few shares selling at 35.5 cents. Is this a temporary blip, or have people started to notice just how good this year's results have been to date, and how much of a net-net this counter is?

(vested, and been adding over the last two months)

Amid the doom and gloom elsewhere, Teckwah's 2015 profits increased 44.6%, to 5.32c/share.

http://infopub.sgx.com/FileOpen/TICL%20-...eID=390873

Final dividend steady at 1.0c/share (plus 0.5c Interim) - directors seem more interested in paying down the bank loans than raising the dividend at the moment.

(Vested)

both top line and bottom line increased and likely close to what Teckwah can acheive with the cost savings of malaysian operations and rental savings and income at Pixel Red.

Earnings wise looking very positive going forwards. However I think Pixel Red was a big capex for teckwah. there is still 19m+ debt which management will likely prioritise to pay off before directing any cash to increasing dividends being the PRUDENT bunch they are. This will likely take another 2-3 years if they continue at the current rate of 7m+ a year repayment. After which they might continue building up their cash holdings as per history has shown.

Good job as always from management. But if the yield at current price is only 4%+ and no net cash in sight for a while, I will be waiting a bit more before jumping in again having previously exited at 40c.

The more I review Teckwah's latest FY15 result announcement and corporate website.....
http://infopub.sgx.com/FileOpen/TICL%20-...eID=390873
http://www.teckwah.com.sg/Home/
and Teckwah's people and HR policies.....
http://www.teckwah.com.sg/TeckwahCareer/
the more I feel very positive about this well-established Print & Pack, Digital Solutions, and Logistics services/solutions provider.

(22-03-2016, 10:04 PM)dydx Wrote: The more I review Teckwah's latest FY15 result announcement and corporate website.....
http://infopub.sgx.com/FileOpen/TICL%20-...eID=390873
http://www.teckwah.com.sg/Home/
and Teckwah's people and HR policies.....
http://www.teckwah.com.sg/TeckwahCareer/
the more I feel very positive about this well-established Print & Pack, Digital Solutions, and Logistics services/solutions provider.

I am feeling very negative about this one though....

[The improved results in this financial year were due to a combination of higher revenue from
customers, the absence of one-off expenses incurred last year, and the cost efficiency achieved. The
Group's strategic decisions to relocate high volume production facilities to Iskandar, and to build and
own our Headquarter building over the past years have helped to improve and contain operation
costs significantly and have gradually delivered results that exceeded expectations amidst difficult
times.]

My take is this will be likely a value trap for next couple years as management uses earnings for paying off debt and accumulate another cash pile at the expense of increasing dividend. boss is prudent and very likely this will happen, not that mgt. are OPMI unfriendly, just that they also have to build up a war chest for bad times. 

if we take div payout at 1.5c a year its measly 3.85% yield for waiting couple of years. Probably worth a look if they pump up the div payout or share price drops another 40-50% to make the yield more attractive.

Note that teckwah during GFC times was 10cent share. May not go back to 10cents but 20cents maybe? likely? during bad market. That's a big downside risk to consider.
Caveat Emptor.

Mr Market seems to treat Teckwah quite well in the last 6 months, and differently!

A relevant question : What is the fair intrinsic value of Teckwah as a well-established business enterprise, and of each Teckwah share (Note: Teckwah now has  233.55m issued shares)?

Bearing in mind Teckwah has a growing and profitable business supported by mostly prime-name corporate/MNC customers, and its new corporate HQ property - Pixel Red - is worth quite a lot more than its corresponding development cost, I would venture a guess that Teckwah now has a fair intrinsic value of at least $200.0m. I welcome inputs from fellow forumers here.

(26-11-2015, 11:29 AM)Dosser Wrote: After sitting quietly at 32 to 34 cents for 3 months, suddenly today there is a relatively big buy queue (by Teckwah standards) at 34.5, with only a few shares selling at 35.5 cents. Is this a temporary blip, or have people started to notice just how good this year's results have been to date, and how much of a net-net this counter is?

(vested, and been adding over the last two months)

Today more happening than usual. Got someone buy 500 lots at 38.5 cents in one shot near the end of the day:

   

Wonder if it could be Ho Bee? The last time they crossed 15% was reported in 2013 at 35.5 cents for 2.4 mil shares:

http://infopub.sgx.com/FileOpen/_FORM3_A...eID=277800

I just took a close look into the 1Q (ended 31Mar16) result.....
http://infopub.sgx.com/FileOpen/FirstQua...eID=404324

Teckwah's Print Related and Non-Print (logistics) businesses continue to trade steadily, generating stable profits and positive FCF. B/S remains rock-solid; and net cash reserve stood at $11.4m (as at 31Mar16) - equivalent to $0.049/share - and continues to rise. I hope Teckwah would consider raising its regular dividend payout - FY15: total $0.015/share in 2 payments - this year and soon.

Teckwah's latest 1Q in-house publication "CaiXun" or “彩讯” makes interesting reading.....
http://www.teckwah.com.sg/Upload/Newslet...7231258854

I find the following portion extracted from the EDITORIAL MESSAGE which described what Chairman Thomas Chua said in Teckwah's Lunar New Year celebrations most amusing.....

He highlighted that 2016 is the year of the “Fire Monkey”, we should learn from the Monkey King in the story of Journey to the West. The Monkey King has the ability to transform himself into 72 various animals and objects, and through his adaptability, coupled with teamwork, is able to overcome obstacles to achieve his mission of helping his master successfully retrieve the sutras in spite of a difficult journey.

Teckwah in business times article:

http://goo.gl/TNejOu


Significantly, Teckwah has grown to provide value-

added services on top of print. It has set up a repair after

warranty service in recent years and has extended its

services beyond Singapore to India and Malaysia where its

customers are. It serves global players such as Dell, IBM

and HP which have appointed it as one of their authorised

after warranty repair services centre.