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I extend to all VB forummers “Kung Hei Fat Choy”,
Pico reported out their audited FY 2012 results, i.e. for the 12 months ending 31st October 2012, on 25th January 2012. Having now digested on them, my take on Pico’s results, in the form of three +ve’s and three -ve’s is as follows…………….
+ve: Sales were up by ~ +10 % year-on-year – by division these were: 33% in “Signage”, 28% in Museum & Theme Parks and 13% in Pico’s key Exhibition & Event Marketing unit.
+ve: Pico’s revenue growth in China continued – China revenues now constitute > 55% of Pico’s total revenues.
+ve: Pico has secured several major projects going forward, e.g. Shanghai Disneyland, the 2014 World Cup in Brazil and the Russian Sochi 2014 Winter Olympics – these can be expected to boost revenues in the coming years. To further propel growth in the PRC, Pico will open two new huge factories, in Beijing and Shanghai, later this year; these will double existing output capacity. The ~ 41,000 m2 Shanghai factory will be the largest Pico has.
-ve: NPAT declined by ~ 4% as compared to FY 2011 – mainly because a) Pico took on a few lower margin projects (in China if I read it correctly) during the course of 2012 and b) re-structuring charges arising from closure of their Chicago office and consolidation of their India operations. As regards point b), DBS Vickers, in their analyst report of 28th January, seemed at pains to stress that if such one-offs were excluded, then QUOTE FY12 core profit actually increased 11% UNQUOTE. I still believe Pico’s FY 2012 bottom line is “so-so”.
-ve: Personally speaking, I am also a tad disappointed with Pico’s final dividend declaration. If the HK$c 5.5 final dividend is included, the full year total is HK$c 9.5, i.e. down > 20% on the FY 2011 dividend, although I recognise the HK$c 12 FY 2011 dividend included a HK$c 4 “special”. The FY 2012 dividend corresponds to a pay-out ratio of 48%, which should be compared to the 59% ratio, i.e. including special dividend, in FY 2011. Based on Pico’s last done of HK$ 2.25 of yesterday, their dividend yield currently now stands at 4.2 %.
-ve: I had expected more revenues arising for Pico from their Yeosu (South Korea) Expo contract. Although I was aware Yeosu was a smaller-scale affair than the Shanghai World Expo, I was surprised to read in Pico’s results announcement that QUOTE the total contribution to revenue was only about 20 % of that from the Shanghai World Expo 2010 UNQUOTE. May be I was being unrealistic regarding revenue expectations from this smaller Expo?……….. but Pico earlier did beat their chest about their involvement.
Since the Pico VB thread was kicked-off on 1st September last year, Pico’s share price has increased by 32 % (thirty-two percent). Over the last 12 months, Pico’s share price is up 40% (forty percent). This positive share price performance lessens to some extent my disappointment regarding their final FY 2012 dividend declaration – but while I had not anticipated anything like a 32% increase in FY dividend, I was not anticipating a dividend reduction.
I will shortly be making a posting on the Kingsmen Creatives thread – since I believe there are some potential parallels and implications in Pico’s results that VB forummers who are vested in Kingsmen may want to consider. Pico is undoubtedly Kingsmen’s key competitor – and, dare I say, company with whom it should benchmark - in Asia Pacific.
Vested in Pico (& Kingsmen)
Pico reported out their audited FY 2012 results, i.e. for the 12 months ending 31st October 2012, on 25th January 2012. Having now digested on them, my take on Pico’s results, in the form of three +ve’s and three -ve’s is as follows…………….
+ve: Sales were up by ~ +10 % year-on-year – by division these were: 33% in “Signage”, 28% in Museum & Theme Parks and 13% in Pico’s key Exhibition & Event Marketing unit.
+ve: Pico’s revenue growth in China continued – China revenues now constitute > 55% of Pico’s total revenues.
+ve: Pico has secured several major projects going forward, e.g. Shanghai Disneyland, the 2014 World Cup in Brazil and the Russian Sochi 2014 Winter Olympics – these can be expected to boost revenues in the coming years. To further propel growth in the PRC, Pico will open two new huge factories, in Beijing and Shanghai, later this year; these will double existing output capacity. The ~ 41,000 m2 Shanghai factory will be the largest Pico has.
-ve: NPAT declined by ~ 4% as compared to FY 2011 – mainly because a) Pico took on a few lower margin projects (in China if I read it correctly) during the course of 2012 and b) re-structuring charges arising from closure of their Chicago office and consolidation of their India operations. As regards point b), DBS Vickers, in their analyst report of 28th January, seemed at pains to stress that if such one-offs were excluded, then QUOTE FY12 core profit actually increased 11% UNQUOTE. I still believe Pico’s FY 2012 bottom line is “so-so”.
-ve: Personally speaking, I am also a tad disappointed with Pico’s final dividend declaration. If the HK$c 5.5 final dividend is included, the full year total is HK$c 9.5, i.e. down > 20% on the FY 2011 dividend, although I recognise the HK$c 12 FY 2011 dividend included a HK$c 4 “special”. The FY 2012 dividend corresponds to a pay-out ratio of 48%, which should be compared to the 59% ratio, i.e. including special dividend, in FY 2011. Based on Pico’s last done of HK$ 2.25 of yesterday, their dividend yield currently now stands at 4.2 %.
-ve: I had expected more revenues arising for Pico from their Yeosu (South Korea) Expo contract. Although I was aware Yeosu was a smaller-scale affair than the Shanghai World Expo, I was surprised to read in Pico’s results announcement that QUOTE the total contribution to revenue was only about 20 % of that from the Shanghai World Expo 2010 UNQUOTE. May be I was being unrealistic regarding revenue expectations from this smaller Expo?……….. but Pico earlier did beat their chest about their involvement.
Since the Pico VB thread was kicked-off on 1st September last year, Pico’s share price has increased by 32 % (thirty-two percent). Over the last 12 months, Pico’s share price is up 40% (forty percent). This positive share price performance lessens to some extent my disappointment regarding their final FY 2012 dividend declaration – but while I had not anticipated anything like a 32% increase in FY dividend, I was not anticipating a dividend reduction.
I will shortly be making a posting on the Kingsmen Creatives thread – since I believe there are some potential parallels and implications in Pico’s results that VB forummers who are vested in Kingsmen may want to consider. Pico is undoubtedly Kingsmen’s key competitor – and, dare I say, company with whom it should benchmark - in Asia Pacific.
Vested in Pico (& Kingsmen)
RBM, Retired Botanic MatSalleh