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Singapore stock market and companies daily report (Guocoland, Qingmei Group holdings, Transcu Group’s) (August 30, 2010)

Contributed by Shares Investment

By Shares Investment

GuocoLand Back In Black, Proposes $532m Rights Issue

Guocoland returned to the black, posted a FY10 net profit of $134.3m, reversing the $70.2m net loss in the previous year, mainly due to recognition of profit from strong sales in China, where its Ascot Park, a 1,112 unit development in Nanjing, had been fully sold. It has also sold an office block and 81% of Soho units in GuoSon Centre Changfeng in Shanghai. In Singapore, Guocoland said it recorded robust sales in Sophia Residence, Elliot at the East Coast and Goodwood Residence. Meanwhile, GuocoLand said that it would launch a 1-for-3 rights issue to raise about $532.5m to strengthen its capital base and fund expansion. The company will sell 296m shares at $1.80 apiece, a discount of approximately 15.9% from the shares’ closing price of $2.14 on Thursday, the last trading day before the announcement.

Significance: Significant improvements coupled with the rights issue, these strengthen Guocoland’s balance sheet and allow it to pursue attractive opportunities for its business in the countries in which it operates.

Qingmei Posts 37% Rise In Bottomline As Revenue Soars 41.6%

Qingmei Group holdings (Qingmei), the producer of high-end sports shoe soles reported a FY10 net profit of Rmb249.99m ($49.8m), up from Rmb182.47m a year back, due mainly to savings from economies of scale. Revenue jumped 41.6% to Rmb1.18b, due mainly to strong sales volume growth as well as stable average selling price of its shoe sole products. The group also saw a shift in product mix from MD I shoe soles to higher-margin MD II shoe soles for the year under review. As a result, revenue for the group’s MD II shoe soles jumped 63.2% to Rm679.4m, accounting for 57.5% of total revenue compared to 49.9% in FY09. Revenue for MD I shoe soles grew 14.8% to Rmb443.5m, contributing 37.6% of total revenue versus 46.3% in FY09. Meanwhile, the company is recommending a full-year dividend of Rmb0.1172 per ordinary share, in line with its intention to distribute dividends of not less than 30% of net profit.

Significance: Buoyed by the economic recovery and strong domestic consumption in the PRC, the demand for shoe sole products is expected to provide strong customer base and lay a strong foundation for Qingmei’s long term growth.

Transcu Achieves Growing Skincare Cosmetics Sales Revenue; Proposes 1-for-3 Rights Issue

Transcu Group’s Japan-based skincare cosmetics unit has significantly ramped up sales through Japanese multi-brand stores. Meanwhile, the firm said it is in final negotiation with a major Japanese pharmaceutical company for a licensing agreement under its pharmaceutical business. This agreement will involve the development of a new drug delivery device for the global market which will use Transcu’s transdermal drug delivery technology. The announcements over the weekend came on the heels of the company’s $14m fund-raising exercise, comprising a 1-for-3 rights share issue at two cents apiece, with a free warrant attached. The warrants, convertible at four cents each, have the potential to raise another $28m.

Significance: Despite the deadline for announcing its 1Q11 results has been delayed to 1 Oct-10, results from 3 segments namely cosmetics, pharma and restructuring have been encouraging with further expansion of its cosmetic business as well as streamlining of its pharmaceutical operations.

This article is contributed by Shares Investment. Visit Sharesinv.com for the latest Singapore, Malaysia and China stock market news and reports.