Nippecraft

Date & Time of Broadcast : 11-Apr-2017 08:12:06
Trading Halt : Pending release of announcement.

(11-04-2017, 01:30 PM)cyclone Wrote: Date & Time of Broadcast : 11-Apr-2017 08:12:06
Trading Halt : Pending release of announcement.

From the looks of how long it is past their watchlist deadline. The company must have told SGX it has plans. This should be an announcement about its future plans to turn "profitable" or an exit offer

The last 2 sentences (reproduced below in blue) in the "Outlook" statement from the lastest FY16 result announcement do give some ideas of things to come...

"The Company will perform a business review on the existing land and building at the Singapore site. The Company will also explore investment opportunities when they arise."

For sure, the realisable fair market value of Nippecraft's leasehold industrial properties in Jurong should be a few millions more than their corresponding 31Dec16 BV of only $3.88m (extracted from the latest Fy16AR).

http://infopub.sgx.com/FileOpen/Nippecra...eID=448682

Quote:The Board is discussing the Decision with the SGX-ST with the aim of obtaining the Extension,
as, inter alia, the Company would have been profitable for the financial year ended 31
December 2016 (FY2016), had the Company not incurred various one-off expenses which
amounted to approximately US$2.37 million (the One Off Expenses) for FY2016. The One
Off Expenses comprise (1) redundancy payout, (2) production wage cost of the retrenched
employees and (3) incurred air freight costs to ensure that its products were delivered to
customers due to outsourcing delays.
Based on its audited financial results for FY2016, had the Company not incurred the One Off
Expenses, the Company would have a pre-tax profit of US$318,000. In this regard, the
Company does not expect to incur the One Off Expenses for the financial year ending 31
December 2017.
The Company will continue to update shareholders on any further developments

Like that also can..
Reminiscence of the days where we haggled with the teacher over the exam paper marks.. I got do working, give me one more mark to pass leh..haha.

(18-04-2017, 08:37 AM)yeokiwi Wrote: http://infopub.sgx.com/FileOpen/Nippecra...eID=448682

Quote:The Board is discussing the Decision with the SGX-ST with the aim of obtaining the Extension,
as, inter alia, the Company would have been profitable for the financial year ended 31
December 2016 (FY2016), had the Company not incurred various one-off expenses which
amounted to approximately US$2.37 million (the One Off Expenses) for FY2016. The One
Off Expenses comprise (1) redundancy payout, (2) production wage cost of the retrenched
employees and (3) incurred air freight costs to ensure that its products were delivered to
customers due to outsourcing delays.
Based on its audited financial results for FY2016, had the Company not incurred the One Off
Expenses, the Company would have a pre-tax profit of US$318,000. In this regard, the
Company does not expect to incur the One Off Expenses for the financial year ending 31
December 2017.
The Company will continue to update shareholders on any further developments

Like that also can..
Reminiscence of the days where we haggled with the teacher over the exam paper marks.. I got do working, give me one more mark to pass leh..haha.

Yes, exactly. Very ridiculous. You don't meet the criteria you should be out. I will have no respect for SGX if they succumb to such reasoning. Offer price based on net cash per share is at about 0.063 cents. US$16m cash (SG$22m) on hand and no debt. market has serious mispricing here.

(18-04-2017, 09:56 AM)activistasia Wrote: Yes, exactly. Very ridiculous. You don't meet the criteria you should be out. I will have no respect for SGX if they succumb to such reasoning. Offer price based on net cash per share is at about 0.063 cents. US$16m cash (SG$22m) on hand and no debt. market has serious mispricing here.

There is always a grey on regulatory enforcement, thus the purpose of appealing. Ultimately, the interest of shareholders should be in priority.

I took a quick look in the stock. Here are few points to share.

Market cap is about 12 million S$, with net cash of about 16 million US$. On face value, a mispricing seems the common conclusion.

But the cash is mostly in subsidiaries, rather than in company. In other words, "extraction" of the cash comes with "cost" of taxes and expenses. The subsidiaries are mostly not in Singapore, but in UK, US, Australia and M'sia.

Furthermore, the company is burning the cash over the last 3 years, at a rate of  ~US$ 1 million a year.

A discount of 70% to the cash, means about US$11 million or S$15 million. The valuation is pretty similar to Mr. Market valuation, after factor-in liquidation cost and further cash burning.

(18-04-2017, 12:20 PM)YMPL Wrote:

(18-04-2017, 09:56 AM)activistasia Wrote: Yes, exactly. Very ridiculous. You don't meet the criteria you should be out. I will have no respect for SGX if they succumb to such reasoning. Offer price based on net cash per share is at about 0.063 cents. US$16m cash (SG$22m) on hand and no debt. market has serious mispricing here.

There is always a grey on regulatory enforcement, thus the purpose of appealing. Ultimately, the interest of shareholders should be in priority.

I took a quick look in the stock. Here are few points to share.

Market cap is about 12 million S$, with net cash of about 16 million US$. On face value, a mispricing seems the common conclusion.

But the cash is mostly in subsidiaries, rather than in company. In other words, "extraction" of the cash comes with "cost" of taxes and expenses. The subsidiaries are mostly not in Singapore, but in UK, US, Australia and M'sia.

Furthermore, the company is burning the cash over the last 3 years, at a rate of  ~US$ 1 million a year.

A discount of 70% to the cash, means about US$11 million or S$15 million. The valuation is pretty similar to Mr. Market valuation, after factor-in liquidation cost and further cash burning.

Thank you for offering an alternative view, YMPL. Very much appreciated.

I totally agree on the extraction cost. They may quote what you have stated to reason for a lower buyout offer but ultimately it can't be too low.  We are now valuing it at purely on a cash per share basis (and a significant discount to it too). What about the assets? No way that is fair. They have destroyed so much shareholder value over the years. 

I think it should still be higher than its current price. The only reason why it is trading at such levels is due to the low free float and the poor sentiment from various reasons over the years (poor shareholder alignment, cash burn rate and etc.) 

In a normal situation, I'd never invest in such companies because there are no exit options, no catalysts, no growth. But now, with a possible exit, it should be re-rating slightly higher.

The free float, as stated in AR 2016, was 36.3%. It is not a low free float stock generally, but probably you mean low liquidity.

Anyway, SGX rejected the appeal. Let's see the cash exit offer. One important note, a cash exit offer isn't a sure thing. It may never come, and the stock will continue be suspended. There was a similar case previously, but I forget the name of the SGX company. Anyone?

---------
The Board wishes to announce that the Company has on 10 April 2017 received a notification
from the SGX-ST that it is unable to grant an extension of time to exit from the Watch-List as
the Company has not demonstrated that it has been able to meet any of the criteria under
Rule 1314 of the Listing Manual (the Decision). Hence, the Company will be delisted pursuant
to Rule 1315 of the Listing Manual.
The Company is required to provide a cash exit offer to its shareholders pursuant to Rules
1306 and 1309 of the Listing Manual, and the SGX-ST will grant the Company an extension of
time for the Company or its controlling shareholder(s) to make a cash exit offer to
shareholders.
Trading of the Company’s securities will continue until 5:05pm on 9 May 2017 and the trading
will remain suspended from 9am on 11 May 2017 until completion of the cash exit offer.

http://infopub.sgx.com/FileOpen/Nippecra...eID=448682

(18-04-2017, 05:22 PM)YMPL Wrote: The free float, as stated in AR 2016, was 36.3%. It is not a low free float stock generally, but probably you mean low liquidity.

Anyway, SGX rejected the appeal. Let's see the cash exit offer. One important note, a cash exit offer isn't a sure thing. It may never come, and the stock will continue be suspended. There was a similar case previously, but I forget the name of the SGX company. Anyone?

General Magnetics ??

(18-04-2017, 05:22 PM)YMPL Wrote: The free float, as stated in AR 2016, was 36.3%. It is not a low free float stock generally, but probably you mean low liquidity.

Anyway, SGX rejected the appeal. Let's see the cash exit offer. One important note, a cash exit offer isn't a sure thing. It may never come, and the stock will continue be suspended. There was a similar case previously, but I forget the name of the SGX company. Anyone?

---------
The Board wishes to announce that the Company has on 10 April 2017 received a notification
from the SGX-ST that it is unable to grant an extension of time to exit from the Watch-List as
the Company has not demonstrated that it has been able to meet any of the criteria under
Rule 1314 of the Listing Manual (the Decision). Hence, the Company will be delisted pursuant
to Rule 1315 of the Listing Manual.
The Company is required to provide a cash exit offer to its shareholders pursuant to Rules
1306 and 1309 of the Listing Manual, and the SGX-ST will grant the Company an extension of
time for the Company or its controlling shareholder(s) to make a cash exit offer to
shareholders.
Trading of the Company’s securities will continue until 5:05pm on 9 May 2017 and the trading
will remain suspended from 9am on 11 May 2017 until completion of the cash exit offer.

http://infopub.sgx.com/FileOpen/Nippecra...eID=448682

Thanks for correcting me on free float. I was basing off of my memory. agree, free flat at 36% isn't low. 

I think you may be referring to Aussino..?