CDW Holdings

1Q15 results out

and

COMPLETION OF LIQUIDATION OF CRYSTAL DISPLAY COMPONENTS (SUZHOU) CO.,LIMITED with USD $5million translational gains to be recorded in next quarter results, should improve earnings by 1c.

pretty ok results for 1Q, hopefully revenue picks up next quarter.

-v-

(15-05-2015, 06:27 PM)BlueKelah Wrote: 1Q15 results out

and

COMPLETION OF LIQUIDATION OF CRYSTAL DISPLAY COMPONENTS (SUZHOU) CO.,LIMITED with USD $5million translational gains to be recorded in next quarter results, should improve earnings by 1c.

pretty ok results for 1Q, hopefully revenue picks up next quarter.

-v-

Agreed that the 1Q results were within expectations.
Seems like the markets haven't taken into account the 5mil gain on long term currency gains that will be recorded in FY15Q2
It's actually rather substantial considering whole year profit after tax in 2014 is around 8.3mil USD.

1 thing that I'll disagree with regarding their accounting is the calculation of NAV/book value.
They disregard the outstanding 19mil employee share options in the reporting. But these options are deeply "in the money" (in using options language)
They will likely be exercised unless something catastrophic happens.
I'd rather be conservative and include the 19mil shares as issued shares.
With that, the book value is actually currently around 14.5 US cents or approximately 18.8 SG cents

<vested>

2Q results out with a recovery in earnings to USD 1.22c fully diluted, making total USD1.55c for 1H and USD 0.5c dividend to be given too. So company will have no problem with a USD 0.7c dividend at year end. Dividend yield of 8.3% at today's closing price of 0.192c is secure.

Most significant :
[The Group’s Backlight Unit segment has worked with a high technology company to develop a new generation of light guides that use different materials and production techniques. Although this new light guide, which offers the feature of flexibility and ultra-thin in thickness, is still under testing as at the date of this report, the Group is confident that this product will be launched in the fourth quarter. The backlight units with this new generation light guide may enable the Group to acquire orders from other LCD module manufacturers as well as the existing customers. For its other core business segments, the Group will continue to steadily enhance its product portfolio but this will take some time.]

If they can secure orders for this new light guide from Apple or Samsung or some big Jap company like NTT DOCOMO, it will be a big win for them.

All in all not a bad quarter, seems like orders are still coming in and production has managed to catch up and things are still chugging along nicely. Have put more detailed write up on me blog.

(16-08-2015, 10:58 AM)BlueKelah Wrote: 2Q results out with a recovery in earnings to USD 1.22c fully diluted, making total USD1.55c for 1H and USD 0.5c dividend to be given too. So company will have no problem with a USD 0.7c dividend at year end. Dividend yield of 8.3% at today's closing price of 0.192c is secure.

Most significant :
[The Group’s Backlight Unit segment has worked with a high technology company to develop a new generation of light guides that use different materials and production techniques. Although this new light guide, which offers the feature of flexibility and ultra-thin in thickness, is still under testing as at the date of this report, the Group is confident that this product will be launched in the fourth quarter. The backlight units with this new generation light guide may enable the Group to acquire orders from other LCD module manufacturers as well as the existing customers. For its other core business segments, the Group will continue to steadily enhance its product portfolio but this will take some time.]

If they can secure orders for this new light guide from Apple or Samsung or some big Jap company like NTT DOCOMO, it will be a big win for them.

All in all not a bad quarter, seems like orders are still coming in and production has managed to catch up and things are still chugging along nicely. Have put more detailed write up on me blog.

Haven't looked in detail into the release, but Thx for sharing your research

(16-08-2015, 02:54 PM)GFG Wrote:

(16-08-2015, 10:58 AM)BlueKelah Wrote: 2Q results out with a recovery in earnings to USD 1.22c fully diluted, making total USD1.55c for 1H and USD 0.5c dividend to be given too. So company will have no problem with a USD 0.7c dividend at year end. Dividend yield of 8.3% at today's closing price of 0.192c is secure.

Most significant :
[The Group’s Backlight Unit segment has worked with a high technology company to develop a new generation of light guides that use different materials and production techniques. Although this new light guide, which offers the feature of flexibility and ultra-thin in thickness, is still under testing as at the date of this report, the Group is confident that this product will be launched in the fourth quarter. The backlight units with this new generation light guide may enable the Group to acquire orders from other LCD module manufacturers as well as the existing customers. For its other core business segments, the Group will continue to steadily enhance its product portfolio but this will take some time.]

If they can secure orders for this new light guide from Apple or Samsung or some big Jap company like NTT DOCOMO, it will be a big win for them.

All in all not a bad quarter, seems like orders are still coming in and production has managed to catch up and things are still chugging along nicely. Have put more detailed write up on me blog.

Haven't looked in detail into the release, but Thx for sharing your research

no problem, I was was looking through reports and happen to be updating my list. Still think the recent dip is not enough yet to put more money in yet. As you pointed out last post after factoring in the share options as expense, its trading pretty much near to NAV and I think any big upside will only come if they manage to finish testing those new light guides and get extra orders in.

(16-08-2015, 10:58 AM)BlueKelah Wrote: 2Q results out with a recovery in earnings to USD 1.22c fully diluted, making total USD1.55c for 1H and USD 0.5c dividend to be given too. So company will have no problem with a USD 0.7c dividend at year end. Dividend yield of 8.3% at today's closing price of 0.192c is secure.

Most significant :
[The Group’s Backlight Unit segment has worked with a high technology company to develop a new generation of light guides that use different materials and production techniques. Although this new light guide, which offers the feature of flexibility and ultra-thin in thickness, is still under testing as at the date of this report, the Group is confident that this product will be launched in the fourth quarter. The backlight units with this new generation light guide may enable the Group to acquire orders from other LCD module manufacturers as well as the existing customers. For its other core business segments, the Group will continue to steadily enhance its product portfolio but this will take some time.]

If they can secure orders for this new light guide from Apple or Samsung or some big Jap company like NTT DOCOMO, it will be a big win for them.

All in all not a bad quarter, seems like orders are still coming in and production has managed to catch up and things are still chugging along nicely. Have put more detailed write up on me blog.

"Other operating income mainly comprised of interest income and exchange gain of US$4.9 million arising from the disposal of a subsidiary during the period under review."

Bro BlueKelah, my concern is "other operating income" especially for this quarter has inflated CDW's earnings. Stripping it out, the results do not look that impressive.

My humble 2 cents.

(16-08-2015, 05:24 PM)sgpunter Wrote: "Other operating income mainly comprised of interest income and exchange gain of US$4.9 million arising from the disposal of a subsidiary during the period under review."

Bro BlueKelah, my concern is "other operating income" especially for this quarter has inflated CDW's earnings. Stripping it out, the results do not look that impressive.

My humble 2 cents.

Yes that is a valid concern, thanks for pointing it out, top line has actually gone down somewhat compared to same quarter last year, which means business is getting worse. But could this be just a reflection of poor global economy affecting most companies nowadays?

That's why for now have not added back to position after selling some for profits previously. The valuation is not looking as attractive as when it was at sub 14c levels

(16-08-2015, 05:44 PM)BlueKelah Wrote:

(16-08-2015, 05:24 PM)sgpunter Wrote: "Other operating income mainly comprised of interest income and exchange gain of US$4.9 million arising from the disposal of a subsidiary during the period under review."

Bro BlueKelah, my concern is "other operating income" especially for this quarter has inflated CDW's earnings. Stripping it out, the results do not look that impressive.

My humble 2 cents.

Yes that is a valid concern, thanks for pointing it out, top line has actually gone down somewhat compared to same quarter last year, which means business is getting worse. But could this be just a reflection of poor global economy affecting most companies nowadays?

That's why for now have not added back to position after selling some for profits previously. The valuation is not looking as attractive as when it was at sub 14c levels

Yes, stripping out the extraordinary items, the results are ok. Nothing to shout about, not disappointing either. Pretty much in line with expectations.

One thing to note though is that CDW's operations are in china, and their revenue is in USD (paid in USD)
So going forward, there'll be some tailwind currency help from the recent devaluation of the RMB and the likely strengthening of USD.

With the drop in price today, the yield is > 10% at the last closing price of $0.148.

Market cap is $70.3m with $60.8m of cash and $13.4m of borrowing.

Getting attractive.

CDW Holding Limited - RHB Securities 2015-09-03: 4Q15 May Be a Pivotal Quarter.