Fu Yu Corporation

[KopiKat]

Noted from the latest announcement of asset disposal on SGX, the NTA could hit 21.98 cts.

Cash on hand will be up from current 6.29 cents to around 7.9 cents?

Anyone can help to verify? Current price seems to be cheap at 6.1 cents.

There would be significant effect from LCTH minority interest as Fu Yu owns 70.64% of LCTH. Thus, the cash attributable to shareholders should be less.

Another thing is, although Fu Yu has S$51.8M at the Group level, there's only S$6.9M at the Company level. At LCTH, there's RM54.8M at Group and RM4.6M at Company (fm AR2012). Of that, no idea how much cash is with CASB although it'll be sold for RM29.5M. The net impact to the Cash at LCTH can be either way but unlikely to increase by RM29.5M.

I also noticed that LCTH used to have RM100M as recent as 1-Jan-11...

I suppose if you're hoping for a Special Div from all the Cash, you'll have to dig further to see if it can be easily transferred to the Company level at Fu Yu?

hmmm.. i always wanted to ask, what's the difference between company and group? I also look at group figures only... What are the implications??

From investopedia,

Definition of 'Consolidated Financial Statements'
The combined financial statements of a parent company and its subsidiaries.

Take Fu Yu's Cash as an example. This Cash at the Group level will be equal the sum total of all the Cash at the Company (Fu Yu) and all their subsidiaries. At the subsidiary level, some (if not most) of the cash will be required for their Working Capital needs or any other needs eg. LCTH seems to continue to be building factories (perhaps relocating to lower cost regions).

That's why I think that those hoping for Special Div payout will have to study more in depth to see if such cash at the subsidiary level are really considered excess and can be transferred (eg. Dividend payout or Capital Reduction) to the Fu Yu company level. A possible example would be the sale of CASB by LCTH. Perhaps, LCTH will have no use for the cash from this sale and pay it out?

I also only recently start to appreciate the differences between Group & Company when I had to make a quick decision whether to put some money into F&N ie. to be able to differentiate that their huge Cash was at Company while the huge Debts mainly at subsidiaries.

Note : I'm not an accountant and my understanding will likely not be totally correct.... I wished I'd not fallen asleep when I was taking night classes on Accounting modules, especially on Consolidated FS, back when I was so much younger...