ARA Asset Management

(24-09-2011, 08:59 PM)Jacmar Wrote:

(24-09-2011, 08:27 PM)freedom Wrote: Will the actual earning be stable at 8 cents per share as reported?

I sat in a presentation 1-2 weeks back by ARA(John Lim and his staff)and here are something worth noting:

1.someone ask about the units that they hold and its impact on mark to market. His response was that the impact to earnings would be minimal as they don't hold a lot unless if the whole market collapse.

2. he eluded an interesting point on how to determine the intrinsic value of such a company like ara. he said that typically such companies in US would price it at 5% of mkt cap to AUM. So this would put the price of ara at about $1.22. voila! as this is what it is right about now giving a yield of about 4%. not great(below inflation rate) and not bad(relatively safe and definitely much better than FD) either. just right. so the only way for the price to go up would be for AUM to go up. so this beg the question as to why he buys at $1.42 right? well see below.

3. there is going to be a big jump in earnings in 3rd qtr of $10million as they will receive a performance bonus from one of the funds.

4. the earnings of 8 cents for this year will be intact as mentioned above. next year can't say.

Hi Jacmar,

Care to share how to attend ARA 's presentation , when will be available ? Thanks.

Quote:Hi Jacmar,

Care to share how to attend ARA 's presentation , when will be available ? Thanks.

It was organise by my broker(KE) house for their clients only. Check with your broker

(24-09-2011, 09:49 PM)Jacmar Wrote: It was organise by my broker(KE) house for their clients only. Check with your broker

I'm using KE as well. How to know about new meet-ups with company CEOs?

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ARA's price has come down quite a lot from the recent high in June. The market might be pricing in a market crash thus affecting ARA's earnings. Suntec's price has been coming down too.

(24-09-2011, 09:54 PM)FFNow Wrote:

(24-09-2011, 09:49 PM)Jacmar Wrote: It was organise by my broker(KE) house for their clients only. Check with your broker

I'm using KE as well. How to know about new meet-ups with company CEOs?

---

ARA's price has come down quite a lot from the recent high in June. The market might be pricing in a market crash thus affecting ARA's earnings. Suntec's price has been coming down too.

They publish it in in their research paper "sunny side up" of upcoming presentations. if not get your broker to keep alert for you.

(24-09-2011, 08:59 PM)Jacmar Wrote:

(24-09-2011, 08:27 PM)freedom Wrote: Will the actual earning be stable at 8 cents per share as reported?

I sat in a presentation 1-2 weeks back by ARA(John Lim and his staff)and here are something worth noting:

1.someone ask about the units that they hold and its impact on mark to market. His response was that the impact to earnings would be minimal as they don't hold a lot unless if the whole market collapse.

2. he eluded an interesting point on how to determine the intrinsic value of such a company like ara. he said that typically such companies in US would price it at 5% of mkt cap to AUM. So this would put the price of ara at about $1.22. voila! as this is what it is right about now giving a yield of about 4%. not great(below inflation rate) and not bad(relatively safe and definitely much better than FD) either. just right. so the only way for the price to go up would be for AUM to go up. so this beg the question as to why he buys at $1.42 right? well see below.

3. there is going to be a big jump in earnings in 3rd qtr of $10million as they will receive a performance bonus from one of the funds.

4. the earnings of 8 cents for this year will be intact as mentioned above. next year can't say.

I have checked thru and found most of the performance bonuses or acqusition fees had been booked in the last Qs , except for the ADF2 , are you refering to the Management fee of ADF2 ?

(25-09-2011, 10:55 AM)Stocker Wrote:

(24-09-2011, 08:59 PM)Jacmar Wrote:

(24-09-2011, 08:27 PM)freedom Wrote: Will the actual earning be stable at 8 cents per share as reported?

I sat in a presentation 1-2 weeks back by ARA(John Lim and his staff)and here are something worth noting:

1.someone ask about the units that they hold and its impact on mark to market. His response was that the impact to earnings would be minimal as they don't hold a lot unless if the whole market collapse.

2. he eluded an interesting point on how to determine the intrinsic value of such a company like ara. he said that typically such companies in US would price it at 5% of mkt cap to AUM. So this would put the price of ara at about $1.22. voila! as this is what it is right about now giving a yield of about 4%. not great(below inflation rate) and not bad(relatively safe and definitely much better than FD) either. just right. so the only way for the price to go up would be for AUM to go up. so this beg the question as to why he buys at $1.42 right? well see below.

3. there is going to be a big jump in earnings in 3rd qtr of $10million as they will receive a performance bonus from one of the funds.

4. the earnings of 8 cents for this year will be intact as mentioned above. next year can't say.

I have checked thru and found most of the performance bonuses or acqusition fees had been booked in the last Qs , except for the ADF2 , are you refering to the Management fee of ADF2 ?

http://www.ara-asia.com/Document_Library...se-IRR.pdf - ARA HARMONY FUND ACHIEVES IRR OF 64.8% FOR INVESTORS

Nick, Thanks.

Does ARA have to sell units it received as management fees immediately at market price? I noticed their cash flow in FY 2007 dipped significantly when compared to FY 2006 ($9.9mil vs $17.2mil) due to losses of $14.5 mil from sale of units in FY 2007. Could management have kept the units till market recovers to sell it off for profits?

(25-09-2011, 07:21 PM)FFNow Wrote: Does ARA have to sell units it received as management fees immediately at market price? I noticed their cash flow in FY 2007 dipped significantly when compared to FY 2006 ($9.9mil vs $17.2mil) due to losses of $14.5 mil from sale of units in FY 2007. Could management have kept the units till market recovers to sell it off for profits?

the units form part of its revenue as in management fee. so if it can't sell at profit, the actual revenue would decrease, so would the profit.

as ARA is fee based asset management company, not an investment company, it almost makes no sense for it to hold on its units received as management fee.

Don't they sell their Suntec REIT units quarterly ?