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03-06-2015, 08:53 PM
(This post was last modified: 03-06-2015, 09:02 PM by greengiraffe.)
Frankly, this BP story was the story of 2011/12. Since then Boustead Group as a whole has almost double. The main question that I have currently is not about the quality of mgt at both parent and subsi but the valuation accorded by the mkt.
Overall the landscape has changed so drastically that the outlook facing the entire group is challenging. Challenging has been repeated several in its most recent outlook statement. Unfortunately for some vested interests that were caught via wrong timing of entry in a new listing, a lot of time is wasted focusing on the wrong aspect on BP.
As a seasoned investor of Boustead group since 2002, I have never seen such challenging conditions facing the entire Boustead Group. I urged caution to be exercise by all readers in assessing so much infomation (and potentially noise) that has been thrown out on a thread on BP that has been newly listed via introduction.
Having said all the above, I have all my due respect for FF Wong and his team. Boustead group in my opinion has emerged much stronger than the previous down cycle with the cashhoard and higher level of recurrent income stream build up since then. This in my opinion will help Boustead transform into an even stronger entity should the right moves come along - accretive acquisition being added on both in existing core and new areas. FF Wong has mentioned in his teleconference that he is only willing to pay between 4 - 6x for such acquisitions. I think FF will eventually has his day as he is a patience and seasoned businessman.
The following is an outlook statement extracted from BP's latest financial statements:
http://infopub.sgx.com/FileOpen/Boustead...eID=353373
In FY2015, the BP Group secured eight contracts totalling $284 million in value, a record level. The BP Group’s order book backlog of approximately $216 million as at the end of FY2015 remains healthy. Since the beginning of FY2016, the BP Group has secured an additional $34 million contract. Nonetheless, the BP Group continues to operate in a highly challenging and competitive industrial real estate market, with the expectation that the difficult business conditions of the past three years are set to continue in FY2016 and will likely have an impact on future gross margins.
The BP Group was successfully demerged from Boustead Singapore Limited, with approximately 48.8% of Boustead Projects Limited’s shares distributed to Boustead Singapore Limited’s entitled shareholders as a dividend in specie. Boustead Projects Limited was listed on the Main Board of the Singapore Exchange on 30 April 2015. Following the successful demerger, the BP Group is positioned to be more focused, quicker to react to opportunities, able to directly tap equity markets for its own capital requirements. This will enable the BP Group to be more adaptable and flexible in addressing the challenges of the industrial real estate market.
During FY2015, the BP Group also embarked on various strategic initiatives to enhance its competitive position. Firstly, the BP Group expanded into Malaysia through a joint development of a clean and green business park, iBP @ Nusajaya, as well as securing a contract from a multinational healthcare corporation for its facility at the Kulim Hi-Tech Park. Secondly, the BP Group established the Boustead Development Partnership to pursue design-build-and-lease, development and
redevelopment opportunities in industrial real estate in Singapore. In March 2015, the Boustead Development Partnership secured its first two development projects in the healthcare and aerospace industries, which will expand the industrial leasehold portfolio and increase future recurring rental income.
In FY2016, the BP Group will continue to seek out development and investment opportunities either on its own or with strategic partners in Singapore, Malaysia, China and potentially other parts of South East Asia. The BP Group believes that notwithstanding the challenging business environment it can continue to
deliver a reasonable level of profit in FY2016.
Overall the landscape has changed so drastically that the outlook facing the entire group is challenging. Challenging has been repeated several in its most recent outlook statement. Unfortunately for some vested interests that were caught via wrong timing of entry in a new listing, a lot of time is wasted focusing on the wrong aspect on BP.
As a seasoned investor of Boustead group since 2002, I have never seen such challenging conditions facing the entire Boustead Group. I urged caution to be exercise by all readers in assessing so much infomation (and potentially noise) that has been thrown out on a thread on BP that has been newly listed via introduction.
Having said all the above, I have all my due respect for FF Wong and his team. Boustead group in my opinion has emerged much stronger than the previous down cycle with the cashhoard and higher level of recurrent income stream build up since then. This in my opinion will help Boustead transform into an even stronger entity should the right moves come along - accretive acquisition being added on both in existing core and new areas. FF Wong has mentioned in his teleconference that he is only willing to pay between 4 - 6x for such acquisitions. I think FF will eventually has his day as he is a patience and seasoned businessman.
The following is an outlook statement extracted from BP's latest financial statements:
http://infopub.sgx.com/FileOpen/Boustead...eID=353373
In FY2015, the BP Group secured eight contracts totalling $284 million in value, a record level. The BP Group’s order book backlog of approximately $216 million as at the end of FY2015 remains healthy. Since the beginning of FY2016, the BP Group has secured an additional $34 million contract. Nonetheless, the BP Group continues to operate in a highly challenging and competitive industrial real estate market, with the expectation that the difficult business conditions of the past three years are set to continue in FY2016 and will likely have an impact on future gross margins.
The BP Group was successfully demerged from Boustead Singapore Limited, with approximately 48.8% of Boustead Projects Limited’s shares distributed to Boustead Singapore Limited’s entitled shareholders as a dividend in specie. Boustead Projects Limited was listed on the Main Board of the Singapore Exchange on 30 April 2015. Following the successful demerger, the BP Group is positioned to be more focused, quicker to react to opportunities, able to directly tap equity markets for its own capital requirements. This will enable the BP Group to be more adaptable and flexible in addressing the challenges of the industrial real estate market.
During FY2015, the BP Group also embarked on various strategic initiatives to enhance its competitive position. Firstly, the BP Group expanded into Malaysia through a joint development of a clean and green business park, iBP @ Nusajaya, as well as securing a contract from a multinational healthcare corporation for its facility at the Kulim Hi-Tech Park. Secondly, the BP Group established the Boustead Development Partnership to pursue design-build-and-lease, development and
redevelopment opportunities in industrial real estate in Singapore. In March 2015, the Boustead Development Partnership secured its first two development projects in the healthcare and aerospace industries, which will expand the industrial leasehold portfolio and increase future recurring rental income.
In FY2016, the BP Group will continue to seek out development and investment opportunities either on its own or with strategic partners in Singapore, Malaysia, China and potentially other parts of South East Asia. The BP Group believes that notwithstanding the challenging business environment it can continue to
deliver a reasonable level of profit in FY2016.