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ha ha Master pharoah88 I really like you, u alway so informative! beside promoting healthway how abt helping us promoting NOVO too...
p.s - I also vested in healthyway, waiting to collect profit...
frOm nO DiViDEND tO DiViDEND
that iS a gOOd CHANGE
frOm fUrnitUre tO cOal
that iS alsO gOOd CHANGE
Novo did a share placement recently which will raise its equity towards US$50million. It's latest venture into coal trading has reaped dividends judging by the much improved financial performance. Considering that two of its steel processing plants will be online in mid 2010 and 2011 respectively, its earnings will be greatly improved. Discounting the blip in 2009, I daresay 2010 points to a continued growth in the company evident from 2007-2008.
Shares = 51.8 million new shares + 36.16 million treasury shares
Price = $0.23
Benefits:
a) It is expected to raise US$19.5 million for their expansion and working capital. It is in a net cash position so none of the proceeds will be used for debt payments. This will help the company expand at a much faster rate with lesser leverage. I believe this will be used to acquire coal and iron ore mines later this year.
b) On 7 January 2010, the Company announced that it is contemplating the possibility of a dual primary listing of all the Shares in issue on the main board of the Stock Exchange of Hong Kong Limited (the “Dual Listing”). The Company is undertaking the Placement to increase its public float to 25% in preparation of the Dual Listing. This placement is hence necessary for the Dual Listing to succeed.
Financial Impact
a) NAV will rise based on Company's calculation.
Current NAV - US$42.706 million (as of 2Q 10)
Outstanding shares - 602,893,640 (excluding treasury shares)
NAV: 7.08 US cents
Post Placement NAV - 8.20 US cents (due to infusion of US$14 million cash)
Outstanding Shares: 683,219,640
b) One off gains from the sale of Treasury Shares
Treasury Shares: 36159000
Purchase Cost: S$4,606,017
Average Share Price: 12.738 SG cents
Cost of Sale: 23 SG cents
Gross Profits: S$3.7 million = US$2.65 million
They stand to earn at least US$2.5 million in net profits from the sale of their treasury shares. This is close to 50% of 1H 2010 net profits.
PENDING ANNOUNCEMENT -
M&A, FRAUD, PROFIT WARNINGS, RIGHTS, PLACEMENT, DUAL LISTING ????
Another source of revenue stream will be online on 2011. This will certainly help it achieve its goals of being a major steel player in East Asia.
BUSINESS UPDATE ON SCRAP STEEL PROCESSING PROJECT
The Board of Directors of Novo Group Ltd. (the “Company”) wishes to announce that Iron and Steel Resources Limited (“ISRL”), an indirect subsidiary of the Company, has recently obtained a letter of approval in principle from the local authority of the PRC that 500 metres long Yangtze River coastal line together with 500 mu (approx. 333,000 sqm) of land be reserved to ISRL.
On the area reserved, a scrap processing plant will be constructed for scrap processing, cutting and slitting of steel products. It is expected that the plant will commence its production in 2011 and shall have a production capacity of 2 million tonnes. To facilitate this plant, two public piers which are able to handle 50,000 tonnes of iron ores and steel products to be imported and exported, will be built.
The processing plant, with initial processing capacity of 1 million tonnes, will add benefits to the electric furnace manufacturers, ship-destruction business and logistic of scrap processing in Jiangsu Province.
The estimated capital expenditure investment of approximately US$24 million will be injected by a local subsidiary of ISRL, which was incorporated in the PRC.
The transaction will be funded through internal resources. None of the Directors and controlling shareholders of the Company has any interest, direct or indirect, in the above transaction.
The Board of Directors of Novo Group Ltd. (the “Company") wishes to announce the incorporation of the following company:
Name : Novo Investment Limited
Authorised Capital : US$50,000 divided into 50,000 shares of US$1 each
Issued and Paid-up capital : US$10 divided into 10 shares of US$1 each
Principal Activities : Trading and Investment
Country of Incorporation : British Virgin Islands
The incorporation of the aforesaid company was funded through internal resources and is not expected
to have any significant impact on the financial position of the Company for the current financial year.
None of the Directors or substantial shareholders of the Company has any interest, direct or indirect, in
the above transactions.
BY ORDER OF THE BOARD
Yu Wing Keung, Dicky
Executive Chairman
I wonder what will Novo Investment be doing hmmm???
Well, the CEO mentioned that they intend to invest in coal and iron ore mines either though acquisition of mines or a stake in a mining company or JV with a mining company with a share of mining profits.
Perhaps Novo Investment will be used for that purpose.
But why would they release it now on the heels of announcing their intention to dual list? Things don't just happen for no reason. Could be a prelude to a JV announcement haha!
I am always the speculator.
rutheone1905 ( Date: 09-Jan-2010 21:26) Posted:
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The dual listing might be utilized to raise funds and secure new sources of credit to aid it in its expansion plans - acquisition of downstream and upstream assets like mines, vessels, ports, warehouse and processing plants. Currently, Novo Group has access to a US$350 million banking facility for its working capital (it only uses around US$40 million) and it has net cash of US$23 million.
After the market closed, it announced that it is setting up a subsidiary called Novo Investment. Not too sure what will its role be but it will have no tangible effect to this year earnings.
tanh2l ( Date: 08-Jan-2010 12:14) Posted:
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grandmaster89 ( Date: 08-Jan-2010 11:22) Posted:
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grandmaster89 ( Date: 07-Jan-2010 18:56) Posted:
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