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Headliners | 02 July 2010
By: Jade Lee
Articles (97) Profile

Stamford Tyres’ Bottomline Jumps Nine-Fold To $9.4m
Stamford Tyres posted a 9-fold jump in its FY10 results mainly attributed to forex gains as well as savings in financial cost from better inventory management. Meanwhile, revenue was 4.5% higher at $310.2m, boosted by increased tyre sales for Stamford’s major and proprietary brands. However, FY10′s gross profit slipped 1.5% to $66.5m, with the gross profit margin falling to 21.4% from 22.7% due mainly to higher tyre purchase prices worldwide and lower sales from the group’s alloy wheel plant in Thailand. A final dividend of 1.0 cents has been recommended, with the dividend payout ratio being 24.5%. ‘We have made good progress in markets such as South Africa, where we commenced sales of Falken tyres in October 2009. Hence, we look forward to enjoying an entire year of its contribution to our bottom line in 2011,’ said Stamford Tyres president and CEO Wee Kok Wah. Stamford has also managed to secure more manufacturing capacity for its proprietary brand of Sumo Firenza tyres, whose sales continue to grow in overseas markets.

Sembcorp Unit Inks MOU To Build Facility In UAE
Sembcorp Industries’ wholly owned subsidiary, Sembcorp Utilities, has inked a memorandum of understanding (MOU) to develop and build a new seawater reverse osmosis facility in the United Arab Emirates (UAE). Sembcorp expects the facility, which will have a potable water production capacity of around 30 million imperial gallons per day (MIGD), to boost its total seawater desalination capacity in the UAE from 100 MIGD to 130 MIGD. The MOU was inked with the Abu Dhabi Water and Electricity Authority (ADWEA). The facility will be located on the same site as the largest operating hybrid desalination plant in the world, the Fujairah 1 Independent Water and Power Plant (IWPP), which is owned by Emirates Sembcorp Water & Power Company, a joint venture between the subsidiaries of Sembcorp Utilities and ADWEA. Sembcorp said the water output of the new reverse osmosis facility will be sold to the Abu Dhabi Water and Electricity Company (ADWEC), under a 20-year deal. This is in addition to a current 22-year deal for the water and electricity output from the Fujairah 1 IWPP to ADWEC. The new seawater reverse osmosis facility is tipped to cost some US$200m and be operational before the end of 2013.

PST To Buy Two Bulk Carriers For US$123m
Pacific Shipping Trust (PST) said that it will acquire two capesize bulk carriers from Mitsubishi Corporation for a total of US$123.2m. At the same time, it also entered into two agreements for the 10-year time charter of each of the new vessels to China-based steel firm Jiangsu Shagang Group Co at US$27,000 per day for each vessel. The consideration for the two vessels amounts to 75% of PST’s market capitalisation of US$165m as at June 25 when its trustee-manager PST Management (PSTM) signed the contract with Mitsubishi. However, PSTM said that the acquisition is in line with ‘the ordinary course of business of PST’ because the commitment to purchase the vessels was done concurrently with the commitment to charter them out, and would not result in any significant change in its risk profile. Meanwhile, the two vessels are expected to contribute about US$194m in charter revenue over the 10-year time charter period to Jiangsu Shagang.

Depa Makes Cash Offer To Acquire Design Studio
Dubai’s Depa Interiors LLC (Depa) intends to make a voluntary conditional cash offer for Singapore-listed Design Studio Furniture Manufacturer, at 55 cents a share. The offer represents a 15.8% premium to Design Studio’s last traded share price of $0.475 on 25 June. Depa, which currently holds a 24.7% stake in Design Studio, said it intends to make the offer for all the shares it does not already own. The takeover offer is conditional on Depa getting acceptances which will result in it and parties acting in concert holding more than 50% of the voting rights attributable to the issued share capital of the company. Should Depa eventually own more than 90%, Design Studio might be delisted. Depa is a unit of Depa Ltd, a Dubai-based group which provides interior contracting services and is primarily engaged in the hospitality, infrastructure, commercial, retail, yacht, theming and specialist interiors sectors.

Jade manages and oversees a portfolio of stocks which are mainly focused on the mining and property sectors at Shares Investment.

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