(29-06-2017, 08:21 PM)karlmarx Wrote: Good move by management! Now to wait for some dividends...
"The property does not form an integral part of the Group’s trading operations, occupancy rate
and rental yield from this property has also been below expectation. It hopes not to commit
more resources to enhance its rental attractiveness on top of meeting more stringent
conservation requirements imposed on the property."
There are quite a number of its investment properties meeting this description. Does that mean we can look forward to more disposal of such properties?
Embedded in the same announcement....not exactly optimistic there will be more dividends as a result of below action.
Uses of Proceeds Pending the deployment of funds, the net proceeds may be used to repay existing bank borrowings, deposited with banks and financial institutions and used as working capital.
(29-06-2017, 08:21 PM)karlmarx Wrote: Good move by management! Now to wait for some dividends...
"The property does not form an integral part of the Group’s trading operations, occupancy rate
and rental yield from this property has also been below expectation. It hopes not to commit
more resources to enhance its rental attractiveness on top of meeting more stringent
conservation requirements imposed on the property."
There are quite a number of its investment properties meeting this description. Does that mean we can look forward to more disposal of such properties?
Embedded in the same announcement....not exactly optimistic there will be more dividends as a result of below action.
Uses of Proceeds Pending the deployment of funds, the net proceeds may be used to repay existing bank borrowings, deposited with banks and financial institutions and used as working capital.
I think the Uses of Proceeds statement is just a formality.
They have cash overflowing from their mouth. the amount of net proceeds received is a dwarf relative to the total amount of cash. The sales proceeds is >$5m. The company's total liabilities is < $4.3m.
30-06-2017, 06:55 PM (This post was last modified: 30-06-2017, 07:05 PM by BlueKelah.)
(29-06-2017, 10:43 PM)argainhunter Wrote:
(29-06-2017, 08:21 PM)karlmarx Wrote: Good move by management! Now to wait for some dividends...
"The property does not form an integral part of the Group’s trading operations, occupancy rate
and rental yield from this property has also been below expectation. It hopes not to commit
more resources to enhance its rental attractiveness on top of meeting more stringent
conservation requirements imposed on the property."
There are quite a number of its investment properties meeting this description. Does that mean we can look forward to more disposal of such properties?
wow this is the REA selling the place, checked out her LinkedIn, work before in Knight Frank, and now manager at Colliers, looks very capable leh, how come can't get a sale? Surely got some big shot ah tiong will buy from her?
These hardware co. needs a lot of working capital to ramp up inventory when market conditions improve, so dont expect Hupsteel to be big on dividends anytime soon.
So long as major customer from Shipping and OnG sector(ASL/Keppel FELs/Sembcorp Industries), which are still in downturn are not buying much, their business wont boom and share price will languish. So basically a value trap until we see conditions improve in OnG and Shipping.
(29-06-2017, 08:21 PM)karlmarx Wrote: Good move by management! Now to wait for some dividends...
"The property does not form an integral part of the Group’s trading operations, occupancy rate
and rental yield from this property has also been below expectation. It hopes not to commit
more resources to enhance its rental attractiveness on top of meeting more stringent
conservation requirements imposed on the property."
There are quite a number of its investment properties meeting this description. Does that mean we can look forward to more disposal of such properties?
Embedded in the same announcement....not exactly optimistic there will be more dividends as a result of below action.
Uses of Proceeds Pending the deployment of funds, the net proceeds may be used to repay existing bank borrowings, deposited with banks and financial institutions and used as working capital.
I think the Uses of Proceeds statement is just a formality.
They have cash overflowing from their mouth. the amount of net proceeds received is a dwarf relative to the total amount of cash. The sales proceeds is >$5m. The company's total liabilities is < $4.3m.
Alas, the effects of confirmation bias.....
If the sales amount is insignificant to its existing cash, and most probably its existing cash needs to be used as working capital for its steel business - and is not been distributed to shareholders, why would this "small 5mil" be distributed? Distributions generally only happen because there are excesses. If a huge amount is required for working capital, it is hard to imagine the "small 5mil" will become an excess.
Take note that we are only discussing whether this sales will be distributed in the form of more dividends or not. No one is disputing the cash it has on its BS or its conservative reporting of its investment properties. I think the odds are stacked against an increased dividend due to this sale - i could be totally wrong but i notice Hupsteel closes in June for its fiscal year, and so we will know in another few months down the road.
(29-06-2017, 08:21 PM)karlmarx Wrote: Good move by management! Now to wait for some dividends...
"The property does not form an integral part of the Group’s trading operations, occupancy rate
and rental yield from this property has also been below expectation. It hopes not to commit
more resources to enhance its rental attractiveness on top of meeting more stringent
conservation requirements imposed on the property."
There are quite a number of its investment properties meeting this description. Does that mean we can look forward to more disposal of such properties?
Embedded in the same announcement....not exactly optimistic there will be more dividends as a result of below action.
Uses of Proceeds Pending the deployment of funds, the net proceeds may be used to repay existing bank borrowings, deposited with banks and financial institutions and used as working capital.
I meant it in jest. I did read that section of the announcement.
01-07-2017, 08:08 PM (This post was last modified: 01-07-2017, 08:08 PM by karlmarx.)
(30-06-2017, 09:24 PM)weijian Wrote: Alas, the effects of confirmation bias.....
If the sales amount is insignificant to its existing cash, and most probably its existing cash needs to be used as working capital for its steel business - and is not been distributed to shareholders, why would this "small 5mil" be distributed? Distributions generally only happen because there are excesses. If a huge amount is required for working capital, it is hard to imagine the "small 5mil" will become an excess.
Take note that we are only discussing whether this sales will be distributed in the form of more dividends or not. No one is disputing the cash it has on its BS or its conservative reporting of its investment properties. I think the odds are stacked against an increased dividend due to this sale - i could be totally wrong but i notice Hupsteel closes in June for its fiscal year, and so we will know in another few months down the road.
Not that it really matters. How much difference could the sale proceed make, right?
wow this is the REA selling the place, checked out her LinkedIn, work before in Knight Frank, and now manager at Colliers, looks very capable leh, how come can't get a sale? Surely got some big shot ah tiong will buy from her?
These hardware co. needs a lot of working capital to ramp up inventory when market conditions improve, so dont expect Hupsteel to be big on dividends anytime soon.
So long as major customer from Shipping and OnG sector(ASL/Keppel FELs/Sembcorp Industries), which are still in downturn are not buying much, their business wont boom and share price will languish. So basically a value trap until we see conditions improve in OnG and Shipping.
Have not seen your postings for awhile. Been busy buying stocks quietly?
In my personal take, I have invested in this company for a long time and I've divested it after realising a few things.
1. I would prefer an asset play company to have a good earnings stream as a second layer of protection. I do not foresee the huge P/B gap to be closed any time soon. I prefer earnings over assets. This company has been under the radar for a long time. An asset value is dependent on the cashflow it can bring in, I walked the grounds and I don't think there are a lot of tenants?
2. I also do not feel that the management has a lot of incentive to grow the money.
3. Asset play with no moat, just a trading business. They are not selling a differentiated product.
(01-07-2017, 08:36 PM)kelvesy Wrote: 1. I would prefer an asset play company to have a good earnings stream as a second layer of protection.
That would indeed be ideal; good earnings, with additional assets, and cheap.
But sometimes even in those situations, it doesn't work out so well. See AP Oil.
As for pure asset plays like Hupsteel, shareholders won't get rewarded so long as value doesn't get unlocked; and nobody knows when it will. Given such risk (in terms of opportunity costs), a conservative approach will be to avoid concentrating positions in it.
wow this is the REA selling the place, checked out her LinkedIn, work before in Knight Frank, and now manager at Colliers, looks very capable leh, how come can't get a sale? Surely got some big shot ah tiong will buy from her?
These hardware co. needs a lot of working capital to ramp up inventory when market conditions improve, so dont expect Hupsteel to be big on dividends anytime soon.
So long as major customer from Shipping and OnG sector(ASL/Keppel FELs/Sembcorp Industries), which are still in downturn are not buying much, their business wont boom and share price will languish. So basically a value trap until we see conditions improve in OnG and Shipping.
Have not seen your postings for awhile. Been busy buying stocks quietly?
Nope, just sitting on the sidelines collecting dividends and occasionally profit taking from those counter that have hit my target.
Now mainly waiting for the market to correct/crash, before I allocate more into stocks.
Also monitoring some indicators. PMIs that came out this week look quite positive but those are Beijing influenced PMIs.
Tomorrow Caixin Manufacturing PMI (more independent) will be out, which will confirm whether manufacturing in China is downtrend or not. Last month turned negative and satellite imaging so far shows slowdown as well for June. So if Caixin PMI is down, I am expecting similar market pullback as in late 2015 to occur later this year. Which will provide plenty of buying opportunity.
Off course not to go off-topic, if that happens Hupsteel price likely to be cheaper than now.
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