Post Reply
41-60 of 146
Report from L&T.
Excluding the RMB14mln tax write-back (withholding tax for div paid last year), 1Q08 net profit would have declined 52% yoy to RMB93mln, in line with our expectation. This accounts for 29% of full year forecast of RMB320mln.
Gross margin fell from 34.3% to 26.8% due to the 35% yoy surge in pork, flour and packaging material prices. Selling and distribution expenses rose 50% yoy, faster than sales growth due to increased spending on TV and signages ahead of the 2008 Beijing Olympics.
The company’s strong net cash position of RMB2bln has already been pre-committed for capital expenditure plans already hence there would unlikely be any share buy back program.
Looking ahead, 2Q08 performance would likely be challenging due to the seasonally slower period which has been compounded by the earthquake in Sichuan where the company’s recently started Chengdu plant is located.
While management do not expect any material impact for now, there could be earnings risks going forward as expenses continue to increase while demand side may see downside risks with the China government’s price controls on staple food rendering premium priced frozen food products less attractive to consume.
In addition, Sichuan being an important pig rearing area in China may see further escalation in pork prices. The reduced bulk sales allowed by the government for hygene reasons would see continued increases in packaging costs for Synear as well.
With the problems mentioned above, it is highly likely for Synear to report another huge yoy bottom-line decline in 2Q08. Hence, despite its low 12x forward PE, the stock could remain depressed in the near term.
CORRIGENDUM TO RESULTS NEWS RELEASE
In the news release on the Company’s results for 1QFY2008 posted on the SGX on May 14, 2008, the increase in the cost of raw materials should be 35%, instead of 18% as stated.
http://info.sgx.com/webcorannc.nsf/ef3ba6cb188613ea482571b2003641d3/89d698126fbd6df04825744f00229dfa?OpenDocument
Its newly started Chengdu plant did not suffer any material damage but the company has shut down the operation temporarily and will try to resume operations as soon as possible. Last year, the Sichuan province contributed less than 1% to the group’s total sales of US$2.2bln, hence management do not expect any material impact for the current financial year.
In NRA's worst-case scenario of the earthquake, they assume 0% utilization at Chengdu plant and predicted a 23% reduction in their earnings estimates.
The Chengdu plant, with annual production capacity of 80,000 tons, accounts for 14% of total capacity in FY08 and was running at management's target utilization rate of 30%. In the near-term, NRA believe that the quake would have an impact on the sales operations of all of Synear's distributors and thwart Synear's expansion plans.
On the cost front, Sichuan accounts for a sizeable 7% of China's cultivated land. Being a big producer of rice and vegetables, the disruption in supplies suggests further increases in food prices in the coming months.
At $0.545, this translates to an ex-cash FY08 PE of about 8x. NRA anticipate further weakness to the price following Synear's results.
yupe, horrible, nett profit decreased 44.8% !
but i noticed some funds are investing synears heavily, can find a good bargain position to vest for long~
jackjames ( Date: 13-May-2008 10:24) Posted:
|
Synear reported that their plant in Chengdu has not suffered any damage and none of their worker there are seriously injured. They have suspended operation of the plant for at least 1~2day and working closely with the government.
The plant only contribute to 20M RMB of there 2.2B RMB Sales. And most of their distributors in that area are safe and not suffer much damage. There are, however, 8 distributors that cannot be contacted in the worst hit area. (From my memory, only Motorola looks after their vendors, included in their Mission Statement. No bad for Synear at ALL!!!)
Finally, this is an interesting part......they will donate 2M RMB in cash and food to Red Cross China.
WOW......this is perhaps the only one I guess that donate money to the disaster victim......For that, I think I will buy their stocks tomorrow. For Fun and Support.... (Asia Power and SinoEnv..did not mention about donation in their press release.)
Did any of you found any companies that help the pple in Sichuan ??
some people call for this price, I take mah.. like the auction u see..
25 cents 1 time, 25 cents 2 times, 25 cents done ! but be realistic la.. worst case scenario will the the march 20 low of 0.37 first.
jackjames ( Date: 13-May-2008 14:35) Posted:
|
cut the crap...just SHORT lah !!! any meats left or not??? hee..
jokers :D
0.25 cent , I take !
But looking at this news below, 0.25 is very promising !!! can be reached ! Die !
Synear Food's Chengdu temporary suspend production due to safety consideration by Singapore Research Team
We just confirmed with Synear Food's management that its Chengdu plant with annual capacity of 80,000 tonnes temporary suspended production after the earthquake. Buildings, machineries and workers were not hurt by the earthquake. Current production suspending was just due to the safety consideration. Management indicate that they will monitor the situation and re-open the Chengdu plant in a day or two.
We expect share price will come under pressure in near term given concerns over the disruption of operation as well as raw materials supply.
This stock has been discounted 20% since last 3 weeks price.. Don't miss to accumulate this gem
April 18, price is about 0.625..
the best is to see the results tomorrow first, then decide which level to buy, at this point of time, AVOID !
jackjames ( Date: 18-Apr-2008 19:37) Posted:
|
words007 ( Date: 10-May-2008 10:54) Posted:
|