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Stocks In Focus SG (CDLHT, Eu Yan Sang Int’l, Frencken Group) – 29/01/14
Daily Bulletin | 29 January 2014
Related stocks:
J85
E28
By:

CDLHT 4Q13 DPU Up 0.7%
• CDL Hospitality Trust’s (CDLHT) revenue for the fourth quarter in FY13 rose 2.8 percent, from $38.3 million a year ago, to $39.4 million as a result of contributions from Angsana Velavaru resort in Maldives, which was acquired on 31 January 2013.
• The improved turnover lifted the trust’s income to be distributed to holders of its stapled securities to $28.5 million, from $28.1 million last year. Consequently, distribution per unit increased from $0.029 to $0.0292, or 0.7 percent.
• Separately, CDLHT announced a rebranding initiative for Orchard Hotel Shopping Arcade. Under a new name, Claymore Link, the mall will undergo an asset enhancement exercise, to increase its net lettable area, and be positioned as a family-friendly mall scheduled to open by end-2014.

Significance: As at 31 December 2013, CDLHT boasts a healthy gearing of 29.7 percent and ample debt headroom to enable its focus on sourcing for suitable acquisition targets in the hospitality sector for FY14.

Eu Yan Sang 2Q14 Earnings Down 31.1%
• For the quarter ended 31 December 2013, Eu Yan Sang International posted an 18 percent gain in revenue, from $77.9 million, to $91.9 million on the back of robust retail and wholesale performance.
• However, a general increase in running costs for Eu Yan Sang’s retail outlets led to a similar hike in distribution and selling expenses, which eroded the firm’s profitability.
• Coupled with a surge in interest expenses, attributable to a $75 million fixed rate notes issued by the company in June 2013, Eu Yan Sang’s bottom line for the period slumped 31.1 percent to $3.2 million, down from $4.7 million a year earlier.

Significance: Although rising business costs, particularly retail rents, continue to pose a challenge, Eu Yan Sang views many positive opportunities, notably from the rising affluence of its largest market leading to increased demand, new product development, extensions of wholesale channels and expansion of current manufacturing facilities.

Frencken Acquires Dutch Oil Filter Firm
• In a move to enhance and widen the service offerings of its automotive business under its integrated manufacturing services (IMS) division, Frencken Group has entered into an agreement to purchase NTZ International Holding.
• NTZ, headquartered in Rotterdam, Netherlands, designs, manufactures and markets high quality oil filters designed for superior filtration in a range of oil. It serves customers in the automotive, heavy duty vehicles, industrial and marine industries.
• The purchase consideration is €2.8 million, approximately $4.8 million, which will be used to settle NTZ’s outstanding shareholders loans.

Significance: Apart from inheriting NTZ’s portfolio of proprietary products, the acquisition will allow Frencken’s IMS division to develop and grow its operating base in Europe to better serve its automotive customers in the region.

CDL Hospitality Trusts  1.650 +0.010 +0.61%   
Business: A stapled group comprising CDL Hospitality REIT and CDL Hospitality Business Trust.

Insight: Jan-19, FY19 net property income (NPI) decreased 3... Read More
Frencken Group  0.550 +0.005 +0.92%   
Business: Co operates as a capital and consumer equipment service provider worldwide. [FY17 Turnover] Mechatronics (72.5%), integrated manufacturing services (35.3%).

Insight: Aug-18, 1H18 revenue increased by 9.9% to $286.2m.... Read More


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