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$0.50 coming soon.....
Below CIMB's Estimate:
Assuming Golden Agri's 2Q results follows the same trend as SMART's, we project the group to report a net profit of US$55m-60m in 2Q13 and US$168m-173m for 1H13. This means that 1H net profit could account for 48-49% of our full-year projection but only 40%-41% of consensus.
Assuming Golden Agri's 2Q results follows the same trend as SMART's, we project the group to report a net profit of US$55m-60m in 2Q13 and US$168m-173m for 1H13. This means that 1H net profit could account for 48-49% of our full-year projection but only 40%-41% of consensus.
chiakenny ( Date: 02-Aug-2013 20:41) Posted:
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The company posted net profit of $45 million for the three months ended June, down 58 percent from a year earlier. The earnings were also 60 percent lower than the previous quarter, mainly due to weaker production and higher plantation costs.
Simply Golden!!!
Here's why Golden Agri's 1H13 results are feared to mirror subsidiary's bad numbers
How bad could the implications be?
According to CIMB, Golden Agri's 1H13 results are expected to be in line with forecast but below consensus, if its 2Q net profit trend mirrors that of its subsidiary SMART, which owns 30% of the group's planted estates.
A 7% yoy drop in SMART's 2Q FFB output was a key surprise. This is below the group's guidance of 5-10% growth in FFB production for the full year, which is negative.
Here's more from CIMB:
Golden Agri is set to release its 2Q results on 2 Aug 2013 (Friday), after the market closes. We are retaining our earnings forecasts and target price – still based on CY14 P/E of 14x, in line with its historical average.
PT Sinar Mas Agro Resources and Technology (SMART), a 97.2%-owned subsidiary of Golden Agri, posted a 28.5% yoy decline in its 1H13 net profit to Rp795bn, mainly due to lower CPO selling prices. 2Q net profit fell 47% yoy and 56% qoq to Rp242bn.
The weaker performances were due to lower CPO selling prices and FFB production. Besides, we suspect that the sharper qoq drop in earnings was also due to the absence of gain from sale of inventory in 1Q13.
- See more at: http://sbr.com.sg/agribusiness/news/heres-why-golden-agris-1h13-results-are-feared-mirror-subsidiarys-bad-numbers#sthash.rknXWZpZ.dpuf
PT Sinar Mas Agro Resources and Technology (SMART), a 97.2%- owned subsidiary of Golden Agri, posted a 28.5% yoy decline in its 1H13 net profit to Rp795bn, mainly due to lower CPO selling prices. 2Q net profit fell 47% yoy and 56% qoq to Rp242bn. The weaker performances were due to lower CPO selling prices and FFB production. Besides, we suspect that the sharper qoq drop in earnings was also due to the absence of gain from sale of inventory in 1Q13.
We are surprised that 2Q13 FFB production fell 2% qoq, which is against the normal trend of 2Q production being typically higher than 1Q output. On a yoy basis, 2Q production fell 7% and this is a lot weaker than management's guidance of 5-10% FFB output growth for FY13.
What We Think
SMART (SMAR IJ, Rp8,400) makes up approximately 30% and 37% of Golden Agri's total planted nucleus and mature palm oil estates, respectively. In 1Q13, we estimate that SMART contributed around 51% of Golden Agri's net profit. The key read-through from PT SMART results for us is the weaker-than-expected production.
Crude Palm Oil
Assuming Golden Agri's 2Q results follows the same trend as SMART's, we project the group to report a net profit of US$55m-60m in 2Q13 and US$168m-173m for 1H13. This means that 1H net profit could account for 48-49% of our full-year projection but only 40%-41% of consensus.
What You Should Do
Based on our read-through from SMART's 2Q results and assuming flattish qoq performances from its China agribusiness, we expect Golden Agri's 2Q results to be broadly in line with our forecasts but below consensus. We maintain our Neutral rating due to the lack of near-term catalysts. (CIMB)
Not to worry, drop below 0.5 is a good time to buy in abit. Remember don't use up all your bullets.
New123 ( Date: 31-Jul-2013 19:41) Posted:
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Nav of US$0.66. i think no nd to worry too much..
HugoTan ( Date: 31-Jul-2013 16:39) Posted:
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Singapore shares slightly fell on Wednesday, with Golden Agri-Resources among the biggest decliners on concerns about a weaker crude palm oil outlook.
The Straits Times Index was down 0.2% at 3,239.29, largely in line with the MSCI Asia-Pacific ex-Japan index .
Golden Agri shares dropped as much as 4.6% to $0.52, their lowest since May 6. More than 141 million shares were traded, 3.4 times the average full-day volume over the past 30 days. The company will report its second-quarter results on Friday.
“There will be more soybean supplies going into the later part of this year with U.S. planting so far doing quite well,” said Ivy Ng, an analyst at CIMB Research.
“Soybean oil is a substitute for palm oil, so there is a concern that palm oil could lose its competitive edge against soybean oil. To keep palm oil competitive, the prices are a bit under pressure.”
The price keep dropping... sien.. possible to drop below 0.5 or not? Any comments?
think 52 cents may hold and may bounce off fm here..
Golden Agri-Resources: Downgrade to HOLD (OCBC)
Summary: Golden Agri-Resources (GAR), being one of the largest palm oil plantation owners in the world, is likely to remain vulnerable to further pullbacks in CPO prices, which had recently hit their lowest levels since Nov 2009. In view of the more muted outlook for CPO, we deem it prudent to lower our 2013 forecast to US$700/ton from US$750 previously. This results in our FY13 revenue and core earnings estimates easing by 2%. Our fair value also drops from S$0.63 to S$0.57 as we are also lowering our valuation peg from 12.5x previously to 11x. Given the limited upside and still uncertain outlook, we downgrade our call to HOLD.
Summary: Golden Agri-Resources (GAR), being one of the largest palm oil plantation owners in the world, is likely to remain vulnerable to further pullbacks in CPO prices, which had recently hit their lowest levels since Nov 2009. In view of the more muted outlook for CPO, we deem it prudent to lower our 2013 forecast to US$700/ton from US$750 previously. This results in our FY13 revenue and core earnings estimates easing by 2%. Our fair value also drops from S$0.63 to S$0.57 as we are also lowering our valuation peg from 12.5x previously to 11x. Given the limited upside and still uncertain outlook, we downgrade our call to HOLD.
Ai si buay si, wo bao si......
Ya.. I think I will hold. Thanks!
beginners ( Date: 25-Jul-2013 19:16) Posted:
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I am not sure how much you have bought. For me average down with just a few 0.0x cents difference not really worth. Better is 0.x cents & below to make my $ worth throwing in again to the same stock if going for long term. Just my sharing view.
Holding power also very important. What I observe this counter is the trading volume is high everyday so you need not worry that it will become a forgotten counter where no trades at all. There are still chances to reach your 0.6 level & higher again. Just have to hold & wait.
Holding power also very important. What I observe this counter is the trading volume is high everyday so you need not worry that it will become a forgotten counter where no trades at all. There are still chances to reach your 0.6 level & higher again. Just have to hold & wait.
HugoTan ( Date: 25-Jul-2013 18:00) Posted:
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Thank you for your opinion! :-) I think I should buy some to average it...coz bought it at 0.60 few months back.. holding for too long already. don't know when can breakeven.
beginners ( Date: 24-Jul-2013 22:26) Posted:
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Not possible from what I see. 0.575 have very thick wall (strong volume) to clear. Unless is a fake one. If not it will not reach 0.6. till month end. Have been following for months. You may consider to trade between 0.540.....0.570 to take small profits. Just my view.
HugoTan ( Date: 24-Jul-2013 17:11) Posted:
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possible to reach 0.6?
Think a lot of people already taking little profits from this pattern 560,565,570,575....570,565,560....
Cleared .555!