Boustead Singapore

Another feather in the cap working with GE. Seems like a S$30m worth of waste heat recovery solutions:

Latest announcements - http://info.sgx.com/webcoranncatth.nsf/V...9003310D4/$file/Boustead_Announcement-BIH_Partners_GE_Oil_Gas_to_Win_Landmark_Contract_from_Brunei_Berakas_Power-28.05.2013.pdf

Last known announcement in late April -

http://www.boustead.sg/Boustead%20Announ...warded%20S$60m%20in%20Contracts%20Globally.pdf

HU8TPPILY VESTED

I saw the announcement this evening.

My concern with Boustead's O&G division is the lumpiness of the revenues, and the fact that revenues haven't exactly grown over the years even though the sub-divisions are supposed to have sorted out all legacy issues and restructured for efficiency.

Another bugbear I have - the margins for O&G division may be under pressure due to stronger competition, as mentioned in the previous results announcement.

(28-05-2013, 11:09 PM)Musicwhiz Wrote: I saw the announcement this evening.

My concern with Boustead's O&G division is the lumpiness of the revenues, and the fact that revenues haven't exactly grown over the years even though the sub-divisions are supposed to have sorted out all legacy issues and restructured for efficiency.

Another bugbear I have - the margins for O&G division may be under pressure due to stronger competition, as mentioned in the previous results announcement.

Pretty much share the same view on the lumpiness.
But this is the nature of Boustead businesses (except probably Geo Spatial & DB&L).

I beg to differ on the margin for O&G.
In fact, I think the margin should improve, as the recent projects are no longer under the pressure of Korean "price-bidding" EPCs.
Recent projects are more US based, in fact Mr Wong mentioned that the project financing in US is a lot more straight-forward (read: performance guarantee is not required etc).

Vested & biased

Thanks Valuestalker for the alternative view.

Let's wait and see if the margins for O&G will improve. For my sake, I hope they do! Haha.

I was searching for news on Boustead International Heaters and came across the following...

Heurtey Petrochem S.A. - Top Competitors
220 words
3 May 2013
GlobalData Company Profiles
GLOMCP
English
© 2013. GlobalData. All rights reserved.
Heurtey Petrochem S.A. Top Competitors
Name : Boustead International Heaters LimitedHeadquarters : United KingdomRevenueUSD :
Name : Chicago Bridge & Iron Company N.V.Headquarters : The NetherlandsRevenueUSD : 4550.54
Name : Foster Wheeler AGHeadquarters : SwitzerlandRevenueUSD : 4480.73
Name : JNK Heaters Co., Ltd.Headquarters : Republic of KoreaRevenueUSD : 95.27
Name : Kirchner Italia S.p.A.Headquarters : ItalyRevenueUSD :
Note
Note : GlobalData uses a range of research techniques to gather and verify its information and analysis. These include primary research, in-house knowledge and expertise, proprietary databases, and secondary sources such as company websites, annual reports, SEC filings and press releases. Disclaimer: No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the publisher, GlobalData. The facts of this report are believed to be correct at the time of publication but cannot be guaranteed. Please note that the findings, conclusions and recommendations that GlobalData delivers will be based on information gathered in good faith from both primary and secondary sources, whose accuracy we are not always in a position to guarantee. As such GlobalData can accept no liability whatever for actions taken based on any information that may subsequently prove to be incorrect.

GlobalData Limited

Document GLOMCP0020130503e953009x7

I have reviewed the most recent announcement from BIH and found the following significant info:

i) Why is oil rich Brunei moving into Gas Fired Power Plants - The Project is designed to help meet Brunei’s growing power requirements and has been
made possible by the Sultanate’s Green Brunei initiative to promote energy efficiency
and develop cleaner energy projects.

ii) BIH participated as a consortium partner - Boustead International Heaters Limited (“BIH”) – a leading global heat
transfer specialist – has together with consortium partner, GE Oil & Gas (“GE”), secured
a landmark contract from Brunei’s national power producer, Berakas Power Company
(“BPC”). This is significant as BIH previously gets sub-contracted works from the giants.

iii) Berakas Power is taking a leading step amongst power producers, by
being the first in the Asia Pacific to deploy such leading edge technology in power
generation through environmentally-sustainable methods. - if Brunei as a oil sufficient nation is taking such steps - it basically means that more countries will over time follow suit to pursue efficient ways of energy production.

iv) As indicated during the conference, we should be expecting more projects from North American gas fuelled downstream projects from BIH with the ongoing shale boom led economic revolution in USA.

Vested, HU8TPY and Biased

Boustead corrected today, can't say I did not see that coming.

The recent price of Boustead was quite high relatively, given that much of their earning growth is driven by one-offs.

EPS of next financial is expected to be significantly lower than the previous. I expect correction to continue.


(vested)

There is no doubt that there are plenty of one-offs last year. However, with the steady build up of recurrent income from ESRI, rental from ind prop (9 assets slightly over 100,000 sm) other engineering divisions including projects - recurrent pretax earnings is easily between S$40 - 50m.

That should easily cover Boustead's stated ordinary dividends of 5 cents a year without special dividends and see their cash pile growing.

So far, I have yet to come across analysts updating their reviews on Boustead. Looks like I may have to dust off my parang and initiate my safari views.

Akan Datang
GG

(31-05-2013, 11:05 AM)Wildreamz Wrote: Boustead corrected today, can't say I did not see that coming.

The recent price of Boustead was quite high relatively, given that much of their earning growth is driven by one-offs.

EPS of next financial is expected to be significantly lower than the previous. I expect correction to continue.


(vested)

(31-05-2013, 10:07 PM)greengiraffe Wrote: So far, I have yet to come across analysts updating their reviews on Boustead. Looks like I may have to dust off my parang and initiate my safari views.

Akan Datang
GG

Very Bullish from Phillips dtd 30 May 13. Not sure if there are other coverage from other analysts on this company

Hope that I am not infringing any copy rights by extract some portions out here.

Not sure if there are other coverage from other analysts on this company


 Maintain BUY with a raised TP of S$1.XX from
S$1.XX as core-profitability has increased. At current
price the stock is trading at 10.1x FYMar14 EPS or
5.1% FYMar14 DPS.

Summary

Company Overview
Boustead operates market leading infrastructure related
businesses: Geospatial Technology (28% PBT), Industrial
Property Design & Build + Property Portfolio (58%), Water &
Wastewater Engineering (1%), and Energy (13%) Related
Engineering. Boustead also generates strong excess cash.

Whats in the news?
 Energy Orderbook has surged by about S$90m since
March YE as Boustead’s direct fired heater and waste
heat recovery systems get more orders globally.

 Orders are outside the Middle East where margins are
significantly better, reflecting the benefits of being a
global operation.

 Management guides positively for Energy orders as
they see demand firm up. The Shale story in the USA is
potentially something to watch for as refining capex
picks up there, Boustead being 1 of 4 global players at
the heart of the refining process.

 Surge in Energy orders offsets weakness in Real Estate
solutions, plus modest recovery in Water orders gives
total orderbook backlog of S$379m (versus S$397m for
last FY start).

How do we view this?
 FYMar13 saw a 46% surge in reported PATMI
(S$81.4m vs S$55.6m y-y) due to early project
completion, non-core investment gains, writeback of
overprovision of taxes, all on the back of
outperformance in core-earnings. The result blew past
our PATMI expectations of S$67.5m. Dividend payout
declared for the full FY turned out to be S$0.07, exactly
as forecasted.

 The key takeaway is to realize that at the core
earnings level, segmental earnings from the 4
business groups far exceeded our estimate of
S$91.1m to clock in at S$106.1m, which is 52%
above previous year’s S$69.7m. Core-profitability is
thus at a new level.

 On the back of this, we estimate that core-profitability
for FYMar14f would be S$93.5m (versus our previous
estimate of S$88.6m), driven by energy and water
orders making up for some lost ground from the real
estate segment. In addition, recurring non-orderbook
earnings from the industrial portfolio and geospatial
segment continue to grow.

No worries. This is a private investment forum. Just upload the analyst report via attachments and buddies here can help to check analysts reports.

Done it many times over. We are like uni lecturers marking undergrads' work.

GG

(01-06-2013, 01:26 AM)evolance Wrote:

(31-05-2013, 10:07 PM)greengiraffe Wrote: So far, I have yet to come across analysts updating their reviews on Boustead. Looks like I may have to dust off my parang and initiate my safari views.

Akan Datang
GG

Very Bullish from Phillips dtd 30 May 13. Not sure if there are other coverage from other analysts on this company

Hope that I am not infringing any copy rights by extract some portions out here.

Not sure if there are other coverage from other analysts on this company


 Maintain BUY with a raised TP of S$1.XX from
S$1.XX as core-profitability has increased. At current
price the stock is trading at 10.1x FYMar14 EPS or
5.1% FYMar14 DPS.

Summary

Company Overview
Boustead operates market leading infrastructure related
businesses: Geospatial Technology (28% PBT), Industrial
Property Design & Build + Property Portfolio (58%), Water &
Wastewater Engineering (1%), and Energy (13%) Related
Engineering. Boustead also generates strong excess cash.

Whats in the news?
 Energy Orderbook has surged by about S$90m since
March YE as Boustead’s direct fired heater and waste
heat recovery systems get more orders globally.

 Orders are outside the Middle East where margins are
significantly better, reflecting the benefits of being a
global operation.

 Management guides positively for Energy orders as
they see demand firm up. The Shale story in the USA is
potentially something to watch for as refining capex
picks up there, Boustead being 1 of 4 global players at
the heart of the refining process.

 Surge in Energy orders offsets weakness in Real Estate
solutions, plus modest recovery in Water orders gives
total orderbook backlog of S$379m (versus S$397m for
last FY start).

How do we view this?
 FYMar13 saw a 46% surge in reported PATMI
(S$81.4m vs S$55.6m y-y) due to early project
completion, non-core investment gains, writeback of
overprovision of taxes, all on the back of
outperformance in core-earnings. The result blew past
our PATMI expectations of S$67.5m. Dividend payout
declared for the full FY turned out to be S$0.07, exactly
as forecasted.

 The key takeaway is to realize that at the core
earnings level, segmental earnings from the 4
business groups far exceeded our estimate of
S$91.1m to clock in at S$106.1m, which is 52%
above previous year’s S$69.7m. Core-profitability is
thus at a new level.

 On the back of this, we estimate that core-profitability
for FYMar14f would be S$93.5m (versus our previous
estimate of S$88.6m), driven by energy and water
orders making up for some lost ground from the real
estate segment. In addition, recurring non-orderbook
earnings from the industrial portfolio and geospatial
segment continue to grow.