GMG Global   

The Hidden Gem

Hmmm.... I see light at the end of the tunnel. Chart does not suggest a sell to me yet. Lets keep watching.

 

market really takes the news badly, now already down 20% to 14.5cts.

 

Time to take profit if u have not done so earlier!!! Good Luck!!

 

Errrr.... may I know what does it mean please ?  Year 2007 will  not perform as well as Year 2006 ? 

 

 

Reg. No. 199904244E
GMG GLOBAL LTD
55 Market Street #03-01 Singapore 048941 Tel: (65) 62208638 Fax: (65) 63230737
BUSINESS UPDATE
The Directors of GMG Global Ltd refers to the ?Outlook for 2007? Statement made in its 2006 Annual Report whereby it was stated that ?The Group is of the opinion that the natural rubber prices could retain the 2006 price level, given the strong fundamentals in place, but will remain volatile. Barring unforeseen circumstances, no major set-back in prices and production volume, and no major adverse weather impact or major operating disruptions, the Directors expect the existing level of performances to be maintained in 2007.?
Following a preliminary review of the Group?s performance, the Directors do not expect the existing level of performances to be maintained in 2007 due to the following factors:
(1)
Lower yield, and field production caused by extremely bad weather conditions prevailing in the first half ended 30 June 2007 which had adversely affected sales and revenue; and
(2)
Higher operating costs as a result of higher Euro currency and the strengthening of the Singapore Dollars ? the reporting currency.
Further details of the Group performance will be disclosed when the Group announces its unaudited half-year results for FY2007 before 14 August 2007.
By Order of the Board
Elson Ng Keng Kwang
President & Chief Executive Officer
16 July 2007

Be careful.

 

For those who"re stuck with slow moving GMG Global..perhaps with about same price it's time to switch to Jade and ride up the price from 20.5cts to 25..to 30..35...>40cts

 

shplayer, Thanks again.....It is really not easy to estimate the eps! Result should out soon and let see how they do this time round!

 

Q to sell at 20cts again...and buy back at 19.5cts..have been lucky so far..hope will not be caught by suddenly soar up....

 

Bullrun,

Bear in mind that vol increase will have proportionate increase only in COGS (Cost of goods sold) and Distribution costs.

Selling Price (SP) increase may have slight increase in COGS.....tappers are paid % of current rubber price, so, when rubber prices are up, the tappers get paid more. But, distribution cost is not impacted. Also, this SP increase is for the whole 2H06 output so this additional 10.7% flows right down to the bottomline

Other costs such as admin, depreciation and finance costs are not affected by volume and SP. In fact, finance cost is coming down cos of better cash situation.

So, the impact of SP and Vol increases has more than proportionate increase in the bottomline. Conversely, the impact on bottomline will be adversely affected in situations of lower output and SP.

Think in management terms its called 'scaleability'.

 

shplayer, Thanks.

This is getting more interesting! 11.4% increase in volume couple with 10.7% increase in unit selling can generate about 84% increase in eps!!

 

Bullrun,

I looked thru the financials of 1H 06 and FY 06 again.

1H06 average sale price was USD2999/mt  and FY06 was USD3161/mt.

This means that it got better price in 2H than 1H......by extrapolating, I estimate that 2H selling price was about USD3320/mt compared with USD2999/mt.for 1H.

This seems to run contrary to my ave prices data.......as such,estimates are just that...estimates. '''''shrug'''''

Therefore, the better 2H 06 eps is mainly due to about 11.4% higher production output and 10.7% higher unit selling price.

 

shplayer,

Thanks for sharing!

More questions.....Last full year eps was 2.2c. The first half eps was only 0.75c (vol 26.3K MT).  Which means eps for 2nd Half was1.45c(vol 29. K MT ). Volume produced is only slightly higher than first half but eps is significantly higher....any theory to explain that?

 

 

 

Bullrun,

Sorry, did not see your post of 29 Jun.

To answer your question, taking the following into consideration:

• 1H07 ave rubber price is about the same as that of 1H06,
• output vol has been trending up.....1H07 (18K MT); 2H05 (27.5K MT), 1H06 (26.3K MT); 2H06 (29.3K MT). So,will expect production output for 1H07 to be about 28K MT......about 6.5% YoY increase.

Bulk shipping has was higher in 1H07, so this may cancel out any benefits of increased output.

So, my guess is 1H07 will be about the same as 1H06....i.e eps of 0.75 c.

Just a rough calcs and my personnal opinion.

 

It'll have to breakout of the channel to convince me.

 

We shouldn't be too concerned about the daily prices. It could just be a rebound.

 

Closed 20c again!!

 

shplayer, Based on your analysis, would you mind sharing your estimate for GMG's HY07 result...

Thanks.

 

Ref my earlier post, the 3rd point should read

• is about the same as H1 06 ave rubber price.

Apologies for the oversight.

 

Bullrun, Shplayer, and other GMG supporters,

Let's look forward for a good set of results in Aug!

Cheers!

 

shplayer,

I always enjoyed reading your posting......avoid getting into those meaningless squabbling is a smart decision!