Reports » Singapore

Singapore stock market and companies daily report (Ezion Holdings, Banyan Tree Holdings, Golden Agri Resources) (March 01, 2013)

Contributed by Shares Investment

Placement Of 50m New Shares; Ezion Holdings
Ezion Holdings (Ezion), has announced that it is proposing to issue 50 million new shares at an issue price of $1.895 per new share, in which the proceeds raised shall be deployed for the purpose of funding the acquisition of a liftboat to be used to support the oil and gas activities of a South East Asian based national oil company. Ezion received a letter of intent with a contract value of up to approximately US$45.3 million over a two year period, and the liftboat is expected to be deployed and working in South East Asian waters by 3Q13, following its final commissioning and completion. Although this transaction is not expected to have a material impact on its earnings per share or net tangible assets per share, the total cost of Phase one and two of the liftboat is about US$140 million. The subscription shares represent approximately 5.5 percent of the existing issued and paid-up share company of Ezion as at 28 February 2013.
Significance: A 5.5 percent dilution on FY13 earnings per share might be expected, but additional earnings contribution from the new liftboat might be expected from FY14 onwards. When completed, the Subscription will increase the existing share capital from 909,918,603 shares to 959,918,603 Shares.

Banyan Tree, Back In The Black
Banyan Tree Holdings (Banyan Tree), developer of premium resorts, hotels and spas have posted a profit of $5 million in 4Q12, as compared to that of 4Q11’s net profit of $1.4 million. This $5 million profit also effectively reverses the loss Banyan Tree reported for 3Q12. The better performance was mainly due to higher operating profit from higher revenue from its hotel investments and fee-based segments. Banyan Tree’s executive chairman Ho Kwon Ping said “the recovery in key markets is expected to continue this year. Economies in European markets remained weak, but they are no longer major markets. We expect the growth in China’s tourism market to continue, partly due to our very strong branding in China and network of sales offices.” Banyan Tree is intending to increase its property sales income via the sale of primary residences in China and elsewhere, and launch a new brand to cater to the price-conscious.
Significance: Overall forward bookings for Banyan Tree’s owned hotels is already 33 percent ahead of that in 2011. Favourable responses towards Laguna Shores, an upcoming residential property project in Phuket has also been received. Since its soft launch in December 2012, deposits for 89 of the 229 apartments have been received.

Golden Agri 4Q12 Profit Affected By Drop In Asset Valuation
Golden Agri Resources’ (GAR) 4Q12 profit took a 93 percent hit to US$53.6 million, from 4Q11’s US$747.8 million, as a result of weaker crude palm oil (CPO) prices. This drop was despite the 14 percent gain in its revenue. Collating it on the whole, net profit for FY12 fell 68 percent to US$409.6 million, as revenue inched up 2 percent to US$6.1 billion. The lower CPO prices also affected its biological asset’s fair valuation, in which saw a 95 percent drop in value to US$49.3 million, compared to that of US$903 million in 2011. Raised costs for the GAR group in China, which was unable to be passed on because of government efforts to control inflation, and higher soyabean prices also added extra pressure to GAR’s performance. Richard Fung, GAR’s director of investor relations expects the low CPO prices to be a temporary phenomenon and that he is optimistic that CPO prices will turn around soon. GAR expects to complete the acquisition of about 16,000 hectares of mature Indonesian oil palm plantations by 1H13.
Significance: With a net-debt to equity ratio of 0.14 times as of 31 December 2012, GAR is in a strong position to take advantage of potential mergers and acquisition opportunities. Continued demand seen from China and India for palm oil is also set to bode well for GAR.