Cogent Holdings

no one update this counter after AR and 1Q 2016.  2016 1Q result is pretty good. 
http://infopub.sgx.com/FileOpen/COGENT_A...eID=404708

Here is my summary after AR 2016 and 1Q2016. Hope to see more discussion on this counter. 

Summary on 2016 AR and 1Q2016:

1. 2015 Revenue grows 9%, while NP grow 40% if excluding one-off gain in 2014. NP from the 4 quarters 2015 are ~5.3, 5.8, 6.8, 7m. NP increase significantly from 3rd quarter. 4th quarter margin at 23%, much higher than first 2 quarters. This due to 96% utilization of cogent 1 from mid2015 as AR showed. 98% utilization by end 2015. Hint: 2016 first 2Q will continue the significant growth due to margin improvement. 20161Q revenue at 32.8, similar as 3Q, 4Q 2015. NP for 2016 1Q is 7.8m, up 45% yoy, 11% qoq; NPM improve further to 24%. Anualized NP 31m, EPS 6.4 cents.   
   
2. Malaysian operation: Phase 1 of warehouse on 536K square feet completed on Dec 2015, start operation from Jan 2016, 100% occupied. Further proceed Phase 2 in 2016 for another 419K sq feet, completion on Apr 2017, will be 100% occupied for 3 year lease. Hint: Malaysian revenue will increase for 2016, contribution to growth xx%? Need to see from later result.
   
3. Cogent 1 logistic hub: land-productive and cost effective. Valued at S$450m. 
   
4. Will develop, own and operate same size logistic hub issued by EDB in Oct 2015. Impact on cash flow in next 2 years.
   
5. Cost side:
   

• Decrease relating to Cogent: Rentals decrease 8% to 28m; Storage/Handling decrease 23% to 3.5m; Repair/Maintenance decrease 9% to 3.9m.
  
• Fuel/Utility: Decrease 19% to 7.2m due to oil drop.   
  

1. Cash Flow: OCF doubled due to Cogent 1; Investing CF increase due to PPE and payment of Malaysian warehouse land.
   
2. Finance:  Debt at 107m, while cash at 44m. OCF 41m. 
   
3. Director remuneration extremely high due to high bonus payout. Tan MC, 2m, Tan YK 2m, Edwin Tan 1m.
   
4. Top 20 holders have 92.56% holdings; slightly increase from 2014’s 92.53%.
   

In Summary, if revenue same in 2016, with the NPM as scale from 4th Q 2015, Cogent could achieve 10% NP growth. Due to the Malaysian new warehouse, it is likely higher than this. >10% NP growth.    

(15-05-2016, 08:34 AM)I\m kyle Wrote: no one update this counter after AR and 1Q 2016.  2016 1Q result is pretty good. 
http://infopub.sgx.com/FileOpen/COGENT_A...eID=404708

Here is my summary after AR 2016 and 1Q2016. Hope to see more discussion on this counter. 

Summary on 2016 AR and 1Q2016:

1. 2015 Revenue grows 9%, while NP grow 40% if excluding one-off gain in 2014. NP from the 4 quarters 2015 are ~5.3, 5.8, 6.8, 7m. NP increase significantly from 3rd quarter. 4th quarter margin at 23%, much higher than first 2 quarters. This due to 96% utilization of cogent 1 from mid2015 as AR showed. 98% utilization by end 2015. Hint: 2016 first 2Q will continue the significant growth due to margin improvement. 20161Q revenue at 32.8, similar as 3Q, 4Q 2015. NP for 2016 1Q is 7.8m, up 45% yoy, 11% qoq; NPM improve further to 24%. Anualized NP 31m, EPS 6.4 cents.   
   
2. Malaysian operation: Phase 1 of warehouse on 536K square feet completed on Dec 2015, start operation from Jan 2016, 100% occupied. Further proceed Phase 2 in 2016 for another 419K sq feet, completion on Apr 2017, will be 100% occupied for 3 year lease. Hint: Malaysian revenue will increase for 2016, contribution to growth xx%? Need to see from later result.
   
3. Cogent 1 logistic hub: land-productive and cost effective. Valued at S$450m. 
   
4. Will develop, own and operate same size logistic hub issued by EDB in Oct 2015. Impact on cash flow in next 2 years.
   
5. Cost side:
   

• Decrease relating to Cogent: Rentals decrease 8% to 28m; Storage/Handling decrease 23% to 3.5m; Repair/Maintenance decrease 9% to 3.9m.
  
• Fuel/Utility: Decrease 19% to 7.2m due to oil drop.   
  

1. Cash Flow: OCF doubled due to Cogent 1; Investing CF increase due to PPE and payment of Malaysian warehouse land.
   
2. Finance:  Debt at 107m, while cash at 44m. OCF 41m. 
   
3. Director remuneration extremely high due to high bonus payout. Tan MC, 2m, Tan YK 2m, Edwin Tan 1m.
   
4. Top 20 holders have 92.56% holdings; slightly increase from 2014’s 92.53%.
   

In Summary, if revenue same in 2016, with the NPM as scale from 4th Q 2015, Cogent could achieve 10% NP growth. Due to the Malaysian new warehouse, it is likely higher than this. >10% NP growth.    

The growth drivers is visible for the company. The Malaysian operations and finally the container operations at its hub.

Correct me if I am wrong, growth however is not without risk.

1) rental savings will be offset by deprecation costs and higher borrowings. 
2) the EDB's proposed development is a LOI, not a firm contract if I read correctly.if it materialized, loans will increase too, however, it's cash flow will more than suffice to pay. Just saying it is not a straight line increase to bottom line

Nonetheless, it is a great company.

(Divested)

According to AR 2015, they accepted the LOI and are preparing the cash for Jurong logistic facility, Considering the parner is EDB, it's mostly a contract already:

We are pleased to propose a first and inal cash dividend of 1.88 Singapore cents per ordinary share in respect of FY2015. This is lower than the 2.58 Singapore cents per ordinary share (excluding special dividend of 1.18 Singapore cents) paid out in respect of FY2014 in view of the expected near-term financial commitment for the upcoming Jurong Island chemical logistics facility project.

Right now, Cogent has 50m Cash and 100m in debt. It's OCF in 2015 stands at 41m. It's Cogent 1 utilization rate rose significantly from second half of 1015. Further with malaysian ware house and container depot section full operation, I expect OCF in 2016 and 2017 will be higher than 2015. This provides enough cash flow for debt financing.

(stay vested)

Question is whats the dividend yield like at current price?

Any margin of safety? Its a net debt company afterall.

What risk of share price crash due to poor market sentiment and owner delist at cheap price?

Future fund raising and opmi share dilution??

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I did some study on this counter a while ago, it is in my wishlist and I hope it get cheaper.

Few things I find:
1. Cogent 1 not only bring cost savings but also additional rental income, I think it is the first in its kind and the management have been very proud of it

2. Invitation from EDB to develop the chemical logistic hub has further proven Cogent 1 innovation, I think this will be materialised over time

3. Grandstand has been doing well, so likely the lease will get renewed  

4. Higher COE expected till 2018, thus the car import/logistic business will boom in near term

5. CEO recent purchase of GCB in prime estate indirectly hinted on management positivity on company outlook

(16-05-2016, 07:28 AM)valuebuddies Wrote: I did some study on this counter a while ago, it is in my wishlist and I hope it get cheaper.

Few things I find:
1. Cogent 1 not only bring cost savings but also additional rental income, I think it is the first in its kind and the management have been very proud of it

2. Invitation from EDB to develop the chemical logistic hub has further proven Cogent 1 innovation, I think this will be materialised over time

3. Grandstand has been doing well, so likely the lease will get renewed  

4. Higher COE expected till 2018, thus the car import/logistic business will boom in near term

5. CEO recent purchase of GCB in prime estate indirectly hinted on management positivity on company outlook

Some may see No.5 as overconfidence/vanity.

or 5. GCB is now a good bargain that CEO brought it...

maybe it's better to buy GCB now, than cogent?

According to management, cogent 1 vertical integrated logistic hub is the first one of this kind. And they have obtained international patents for this design.


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Or 5. The CEO has been earning good fees from Cogent, and expect to draw even more fees, so he decided to burn it on property?

COGENT WINS LEASE TENDER FROM SINGAPORE LAND AUTHORITY TO OPERATE STUDENT HOSTEL AT 362 HOLLAND ROAD

The Board of Directors (the “Board”) of Cogent Holdings Limited is pleased to announce that its wholly-owned subsidiary, Cogent Land Capital Pte Ltd, has been awarded a threeyear lease by the Singapore Land Authority to operate a student hostel at 362 Holland Road (the “Property”). The lease agreement allows for a further term of three years upon request.

http://infopub.sgx.com/FileOpen/Cogent_H...eID=469862