Yangzijiang Shipbuilding (Holdings)

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http://www.businesstimes.com.sg/companie...-q3-profit

Yangzijiang posts 1% fall in Q3 profit
By
Angela Tanangelat@sph.com.sg
8 Nov5:50 AM
Singapore

YANGZIJIANG Shipbuilding reported on Friday that its net profit for the third quarter ended Sept 30, 2014, slipped one per cent to 811.19 million yuan (S$172 million) due to lower gross profit, other income and other gains.

Earnings per share were 21.17 fen, compared to
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Yangzijiang reports stable earnings of RMB811 million for 3Q2014
揚子江船業(911609)2014 年第三季度 收益穩定,獲淨利人民幣 8.11 億元

 Revenue up 2% to RMB3.74 billion as Investment Segment had several higher return HTM investments, however, earnings declined marginallyby 1% due to lower gross profit, other income and other gains, partly supported by lower tax expense
 受投資業務較高回報持有至到期金融資產的支撐,本期集團收入增長2%至人民幣37.4億元;由於毛利稍降以及其他收入和利益的減少,集團盈利微降1%,所得稅費用降低亦在一定程度上支撐了盈利

 Group was listed in the first batch of “White List” rolled out by the Chinese government, to enjoy favorable policies and to enhance market position
 集團成功進入首批由中國政府認證的符合《船舶行業規範條件》的船企“白名單”,集團發展有望獲得有利政策支持,進一步鞏固市場地位


YZJ 2014-3Q PRESS RELEASES

YZJ 2014-3Q RESULTS PRESENTATION
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OSK report on the company, TP $1.68, and rating BUY.

(vested)

Yangzijiang held at ‘buy’ with target price of $1.68 by OSK-DMG
By PC Lee / TheEdge Markets.com | November 10, 2014 : 4:47 PM MYT

SINGAPORE (Nov 10): OSK-DMG has maintained its “buy” call on shipbuilder Yangzijiang with a target price of $1.68, representing an upside of 45%.

In a report dated Nov 10, OSK-DMG analyst Lee Yue Jer says Yangzijiang’s orderbook stands strong at US$4.6 billion. The company has also been included in the Chinese government’s “white list” of shipyards, making it easier to secure financing and orders.

As such, the research house believes Yangzijiang is the strongest shipbuilder in China in a recovering industry.

Lee says Yangzijiang has again proven skeptics wrong by delivering a healthy 3Q14 with gross shipbuilding margins maintained at 20%, translating into a healthy earnings of RMB 811 million.

OSK-DMG believes the yard is solidly on track to deliver FY14F core earnings of RMB3.1 billion, with 9M14 figure at about RMB2.3 billion.

In addition, Yangzijiang has trimmed its Held-to-Maturity assets, with the quantum now standing at RMB12.6 billion from RMB13 billion.

“We expect a slow decline in this figure in inverse relation with the overall health of the shipbuilding industry, as funds are gradually redirected towards YZJ’s core shipbuilding business,” says Lee.
http://www.theedgemarkets.com/sg/article...68-osk-dmg
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡
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On what basis does the analyst think that the ship building industry on recovery? I have yet to see any signs of recovery judging from the concerns over the health of global economies that is the main driver of the global shipping industry which is one of the toughest business presently... at least from what NOL is spilling red ink...

I wouldn't even touch any offshore and marine play now...

Not Vested
GG

(10-11-2014, 09:00 PM)CityFarmer Wrote: OSK report on the company, TP $1.68, and rating BUY.

(vested)

Yangzijiang held at ‘buy’ with target price of $1.68 by OSK-DMG
By PC Lee / TheEdge Markets.com | November 10, 2014 : 4:47 PM MYT

SINGAPORE (Nov 10): OSK-DMG has maintained its “buy” call on shipbuilder Yangzijiang with a target price of $1.68, representing an upside of 45%.

In a report dated Nov 10, OSK-DMG analyst Lee Yue Jer says Yangzijiang’s orderbook stands strong at US$4.6 billion. The company has also been included in the Chinese government’s “white list” of shipyards, making it easier to secure financing and orders.

As such, the research house believes Yangzijiang is the strongest shipbuilder in China in a recovering industry.

Lee says Yangzijiang has again proven skeptics wrong by delivering a healthy 3Q14 with gross shipbuilding margins maintained at 20%, translating into a healthy earnings of RMB 811 million.

OSK-DMG believes the yard is solidly on track to deliver FY14F core earnings of RMB3.1 billion, with 9M14 figure at about RMB2.3 billion.

In addition, Yangzijiang has trimmed its Held-to-Maturity assets, with the quantum now standing at RMB12.6 billion from RMB13 billion.

“We expect a slow decline in this figure in inverse relation with the overall health of the shipbuilding industry, as funds are gradually redirected towards YZJ’s core shipbuilding business,” says Lee.
http://www.theedgemarkets.com/sg/article...68-osk-dmg
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http://www.nextinsight.net/index.php/sto...ble-causes

YANGZIJIANG: Chairman Donates RMB520 M To Charitable Causes


Groundbreaking ceremony in Oct 2012 of the Jiangyin Yuanlin university. Mr Ren is fifth from the left.


Photos courtesy of Yangzijiang Shipbuilding

HERE'S AN uplifting story of the generosity of a Chairman and CEO. It is also about the dividends paid out by a S-chip company (when most S-chips pay no dividends) and, indirectly, about the prospects of more to come.

The man is Ren Yuanlin who heads Yangzijiang Shipbuilding. He has made possibly the highest charitable donation among China’s new generation of entrepreneurs.

Ren Yuanlin (third from right) at the opening of the Jiangyin Yuanlin university named after him.
A staggering amount of RMB520 million donated by him to charitable activities in 2012-13 has firmly put his name on the Hurun Charitable Rich List for two consecutive years.

Ranking No. 533 on the Hurun China Rich List with a net worth of RMB3.8 billion, Mr Ren sat at No. 4 and No. 7 positions on the Hurun Charitable Rich List in 2013 and 2014, with donations of RMB270 million and RMB250 million, respectively.
The donations have been channelled into a charitable foundation, established in June 2012 and named after Mr Ren Yuanlin, with the intention to help vulnerable elders, as well as aid technological innovation and disaster relief.
Within a short period since inception, the Foundation has constructed and established its first three universities for senior citizens, with a collective GFA of approximately 29,000 sqm, in Jiangyin, Jingjiang and Taixing cities.

Mr Ren (4th from left) at the opening of the Taixing Yuanlin University.
The three universities, offering a variety of courses such as science, literature, technical know-how, healthcare, music and dance, Chinese folk performances, martial arts and sports have enrolled up to 17,000 students for their first school terms, starting on 1st September 2014. Scholarships and subsidy money have been set aside to encourage participation.
Operated by a professional management team, the Foundation seeks to build 8-10 universities for senior citizens in Jiangsu Province and beyond, and to expand to the treatment of chronic diseases for senior citizens.

Press briefing on the Yuanlin Charity Fund donating to “Cataract Project” in Taixing City.
For example, the Foundation has initiated the "Cataract Project" to provide free sight restoring surgery.

The first batch of patients, comprising close to 10,000 people from three cities, namely Jiangyin, Jingjiang, and Taixing in Jiangsu Province, have benefited from the project since August 2014.

Mr Ren’s donations came from dividend earnings from his one billion-shares stake in Yangzijiang.
Mr Ren has committed to give out his entire dividend earnings over a period of five years with the total donation expected to cross the one-billion yuan level.

This not only provides a stable funding source to the Foundation, but also strengthens its linkage with Yangzijiang’s business performance.
“Parents and relatives of Yangzijiang’s over 20,000 employees will benefit from the charitable activities, and this a means for me to give back to society,” said Mr Ren.
“Thousands of villagers have been contributing their youth and efforts to Yangzijiang’s development for decades, and providing better care to their family is always on my mind.” Mr Ren added. Charity, just like anything else Mr Ren does, is not for fame but for the benefit of all stakeholders.


A very good example of 取之于民,用之于民。Salute to this boss....
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The "outlook" of the company seems improving, among the analysts.

(vested)

Yangzijiang upgraded to "buy", target raised to $1.44 by UBS

SINGAPORE (Nov 28): UBS has upgraded Yangzijiang Shipbuilding to "buy" from "neutral" and raised its sum-of-parts price target to $1.44 from $1.21.

The company's gross profit margins have held up better than expected this year as the contracts for the vessels delivered so far were secured after the peak of the shipbuilding market, according to UBS analyst Cheryl Lee.

"We think the stronger-than-expected margins were driven by lower steel prices and execution efficiencies," she said in a note.

The 10,000-TEU vessels now being built by Yangzijiang require only 70 days in the drydock instead of about 130 when it first began work on this design, she said.

Lee has also raised her 2014 to 2016 earnings estimates by 43%, 3% and 1% respectively to factor in higher margins on lower material prices and cost savings from a weaker Chinese currency.

The company's decision to reduce its non-core businesses - held-to-maturity investments, microfinance, property and shipping - also bodes well, according to Lee.

It said earlier this year that it would limit the total capital allocated to its held-to-maturity investments portfolio to RMB16 billion ($3.2 billion).

"We were initially sceptical of the company's commitment to its change in strategy, but acknowledge that initial progress towards better business control has been made over the last two quarters.

"If the company continues demonstrating gradual progress through 2015, we believe investors would respond favourably."

Yangzijiang shares ended 1.2% higher at $1.225 yesterday.
http://www.theedgemarkets.com/sg/article...-144-ubs-0
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡
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Yangzijiang gets up to US$510 million of orders in 4Q2014
http://www.theedgemarkets.com/sg/article...ers-4q2014

By Frankie Ho / theedgemarkets.com | January 5, 2015 : 8:17 AM MYT


SINGAPORE (Jan 5): Yangzijiang ( Financial Dashboard) Shipbuilding secured US$388 million ($485 million) of new orders in 4Q2014 with options to build another US$122 million worth of vessels, the company said in a statement this morning.

The new contracts bring the total value of orders clinched in 2014 to US$1.8 billion, comprising 41 ships, according to the China-based shipbuilder.

Six outstanding options to build container ships and bulk carriers were carried forward to this year.

The US$388 million worth of orders secured in 4Q2014 are for a total of 13 ships, including 10,000-TEU (20-foot equivalent units) container ships, which are slated to be completed between 2015 and 2017.

The US$122 million worth of options are for four vessels.

"The 10,000-TEU containerships, offering outstanding cost efficiency in shipping, has become one of Yangzijiang’s flagship products; they will continue to gain attention from ship owners, and contribute to the future growth of the group, along with our other endeavors," Yangzijiang executive chairman Ren Yuanlin said in the statement.
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Base on the last review, the company production capacity has fully utilized. Will the company acquire new yard(s) in near future, amid the market consolidation?

(vested)
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡
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Nomura Coverage:
A yard play on potential freight rates rebound
Potential price catalysts from earnings upgrades, h-h new orders rebound, and higher dividends

Initiate coverage at Buy with SGD1.56 TP; with implied 30% upside
We derive our TP of SGD1.56 by using 1.2x forward P/B on CNY6.1 BV / share as of end-FY15F, which is the average of mean and mean minus one standard deviation P/B, and is in line with the mixed outlook for the rebound in new orders for dry bulk carriers, and the weak orders for containerships. We observe that YZJ is the second-largest global builder of dry bulk carriers and also builds containerships and jackup rigs. It has consistently delivered above industry profit margins and its large order backlog covers beyond FY16F.

Upside potential to FY15-16F consensus net profit estimates
Our FY15-16F core net profit estimates are 28-38% above consensus; we think this is on the Street’s underestimation of: 1) YZJ’s superior shipbuilding operating profit margins; 2) the recognition of recurring tax rebates from the Chinese government; and 3) the write-backs of provisions in 4Q14-17F, as the group’s held-to-maturity (HTM) products are scaled back from 2H14F.

Potential BDI rebound from late-1Q15 to catalyze new dry bulk orders
The Baltic Dry Index (BDI) had dipped to 782 by late-2014 (vs a trough of 647 in early February 2012), and is below cash cost breakeven levels. We expect the higher fleet idle ratio and seasonal demand rebound to catalyse the reversal of the BDI in late-1Q15F. This should in turn catalyse the rebound in new dry bulk carrier orders for YZJ; vs zero orders since July 2014.

Dividend payout for FY15F to increase on excess cash in balance sheet
We expect the dividend payout to increase to SGD0.06/share for FY15F vs the SGD0.05 for FY13 and FY14F. We estimate YZJ will return to a net cash position by end-FY15F, as its profitable shipbuilding operation’s capex dips, and the group positively reduces investment in HTM products from 2H14F.

Key investment risks to our investment thesis
Downside risks to our forecasts include: 1) Weaker-than-expected shipbuilding orders; 2) a sudden sharp rise in steel plate prices; and 3) a reversal of its strategic decision to scale back HTM product investments.


Attached Files
.pdf   Yangzijiang 20150105 nomura - potential freight rates rebound.pdf (Size: 1.23 MB / Downloads: 15)
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IIRC, the TP is the highest so far, at $1.68. The analysts are "promoting" the company...

The yard capacity is fully utilized, and the management has a luxury to cherry pick higher premium orders...

Yangzijiang kept at "buy" with $1.68 target by OSK DMG

SINGAPORE (Jan 6): OSK-DMG has kept its "buy" rating and price target of $1.68 for Yangzijiang ( Financial Dashboard) Shipbuilding, noting the company's strong order book.

“With a total US$4.7 billion ($6.27 billion) of orders in the last two years, Yangzijiang’s yards are relatively full,” OSK-DMG analysts Lee Yue Jer and Jesalyn Wong wrote in a note today.

The China-based shipbuilder's current order book is estimated to be worth US$4.5 billion ($6 billion), they said.

The company said yesterday that it secured orders in 4Q2014 to build nine vessels, bringing the total value of contracts clinched last year to US$1.8 billion.

Meanwhile, the strengthening US dollar will benefit the firm as its revenue is denominated in the greenback while costs are in the Chinese yuan, the analysts said, adding that lower oil prices are another plus factor as they should aid global economic growth, which in turn will increase trade flows and demand for shipping services.

Shares of Yangzijiang slipped 1.6% to $1.23 at 11:22am (0322 GMT).
http://www.theedgemarkets.com/sg/article...et-osk-dmg
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡
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