Monday, September 23, 2013

Analysis on China Fishery

China Fishery is listed on SGX on 25 Jan 2006

Financial Data
(All values listed in USD unless otherwise stated)
          
Year                     EPS                   REV                     Net Profit % Margin
2013               6.1 - 7.3c (est)       
2012                   7.63c                  604.001 mil            12.93%
2011                  10.22c                  685.45 mil              15.10%
2010                  13.01c                 538.931 mil             21.60%   * Change in financial yr to end at Sept
2009                  9.08c                   383.449 mil             20.37%   * 9 mths reporting (Jan - Sept)
2008                 12.05c                  459.419 mil             20.52%
2007                 11.37c                  406.369 mil             21.77%
2006                  6.70c                   157.082 mil             31.40%

Year                  Shrs Issues               Div Issued(SGD)
2013                 2,046,354,546         
2012                 1,023,177,273         0.19c with Rights offer 1 for 1 @ SGD 0.34
2011                 1,022,262,139         0.45c
2010                 1,002,421,099         0.50c (scrip div)
2009                 860,287,997            0.42c (scrip div) + Offer 1 shr for 10 shrs
2008                 782,080,000            2.19c
2007                 782,080,000            5.51 c + Stock split 1 to 2 shr  
2006                 362,040,000            5.31c:

Other Datas (As at 28 Jun 2013)

Debt
        Current:  191.115 mil
        L.T      :  427.945 mil
        Total    :  619.05 mil

Cash Bal : 318.28 mil

NAV: $ 0.56  / SGD 0.70 (Taking USD 1 = SGD 1.26)

Shares Issued: 2,046,354,546
Warrant: 35,728,154 @ exercise price SGD 1.57
Rights: 1,023,177,273 @ exercise price of SGD 0.34

Business Model

The company operated around the world on high seas with the following operations:
  • Fishing and fish supply
  • Fishmeal & fish oil processing
  • Fish products
Opinion 

With the financial data reported, this company looks good as it has a proper margin and good revenue. But further inspection of its shares issued and dividends, i feel that the renumeration committee is not rewarding its shareholders properly. As the years progress, the dividend shrink is size and their shares sizes have increased much faster than their revenue. I viewed it as diluting the shareholder's value.

With the current debt that stands at 191 mil, they should be able to self-sustain for a year or two before their larger debt obligation came crushing. With the 3rd qtr reporting (as at 28 Jun 2013) with an earnings of 5c (using 1,411,522,895 shrs), we can expect around 6.1c - 7c earning for the full yr. But with enlarged shareholdings, i expect around 2 - 2.5c earnings.


Conclusion

Given that the mkt price at SGD 0.40 (as on 23 Sept 2013, 1600), my conclusion is that it is still a BUY with aim of capital appreciation till SGD 0.66. Best buying range is around SGD 0.35 - 0.38.


   
DISCLAIMER The ideas expressed in this blog should not be used to buy or sell the securities, commodities or assets mentioned. The accuracy or completeness of the information provided cannot be guaranteed. Readers should carry out independent verification of information provided. No warranty whatsoever is given and no liability whatsoever is accepted for any loss howsoever arising whether directly or indirectly as a result of actions taken based on ideas and information found in this blog.

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