CWT

[zxiank]

Results are poor. Although the full year results seemed good, but if you look at Q4, the commodity marketing biz and financial services biz are performing badly, especially the commodity marketing part.

CWT dropping 6% today, 4 million shares volume, cannot find any news release. Does any VB have an idea why?

[vesfreq]

Any vb vested in this?

[banker]

Browsing though the CWT AR 2013, noticed one of the executives has salary of S$7.25 million and prior to the acquisition of MRI in AR 2010, the same executive has salary of S$3 million and that is > 100% increased in salary. I'm suspecting the executive is none other than CEO Loi Pok Yen.

For the past few years, the AGM has been conducted in Tanjong Perjuru at 5 pm which is pretty inaccessible but lucky the company did provide bus service for investors who are keen in attending the AGM. The AGM for this year is scheduled on 38 Tanjong Penjuru, CWT logistics Hub 1 on 23 April 2014 at 5 pm. Is dinner provided by the company?

For 2014, The CEO Salary is in the band of more than S$10,250,000... In 2005, he was earning around 750K...

[CY09]

Interesting! DBS's CEO FY 14 remuneration was s$10.12 Million and DBS earns a core profit of s$3.85billion vis a vis CWT's s$112Mil. Is it because CWT's CEO package consisted of more stock options and less cash? Also, one possible question to shareholders is if such a high compensation to the CEO is warrant able when CWT's profit is only 113 Mil and if it is compared to Bank's or that of other temasek linked coys. I noticed the AR mentions "86% of his package is variable", i guess he gets a good share of the profit growth CWT makes annually

Personally I do not like CWT as it is a highly geared company, despite being one of the logistic provider for SAF products. Furthermore, its cash flow generative ability seems to be terrible. Not much knowledge of its commodities and logistics industry, so I generally avoid such companies. It seems like another family run business (60% held by Loi). Coincidentally the 2 "purely private" companies which sent NDP contingent for 2014 NDP, Swiber and CWT, are highly geared - just a spurious correlation I noticed.

Other info: FY 13 CWT CEO remeuration was s$7.25 mil on back of s$96.5Mil proits.

http://www.channelnewsasia.com/news/busi...68936.html

[kayhian]

CWT adopts an integrated business approach with Logistics at the core.

I like their strategy as a growth stock.

On the defensive side, CWT got Logistics.

On the growth side, CWT got Commodity Marketing and Warehouse Properties.

Happily vested

I still like their growth story

[kayhian]

CWT Limited: Appointed as logistics service provider for 28th SEA games

With the official opening of the Singapore Southeast Asian Games Organising Committee (SINGSOC) Logistics Centre (SLC) yesterday, CWT Limited (CWT) announced that it will be providing full supply chain management and supporting logistical services inclusive of manpower and transportation for the 28th Southeast Asian (SEA) games. CWT will also be handling significant air and sea freight during this period. The SLC, which is located on CWT’s premises, will provide a monthly warehouse space of 17,000 sqft and storage space for 11,000 pallets over a 12-month period. CWT is also expected to make ~3,000 truck trips to transport supplies and equipment to competition venues for the games. While we believe this announcement is positive, we think that it is not significant enough to change our forecasts, since it will also be giving SINGSOC discounts on operation transportation costs. Hence, maintain BUY rating on CWT with an unchanged FV estimate of S$1.98. (Eugene Chua)

[vesfreq]

Interesting read. Not sure if it was posted before. If it was, apologies for the repeat.

http://www.forbes.com/sites/forbesasia/2...n-revenue/

Loi Pok Yen 's last point is very true "Don't worry about making a mistake, but don't repeat it." For value investors, thats a very good advice. Made his first M from leveraged trading. Brave.

Vested in small quantities.

[vesfreq]

Results are poorer this q1 2015. Surprised by the sudden sell down to 1.815 low today.

Though drop in commodity trading revenue was significant, the fall in gross margin was 3%. The core logistics business is still stable. Other than slightly higher overheads, cwt remains profitable.

I read somewhere that this is due to drop in volume of naptha being traded and that price of naptha was lower in Q1 2015. This then contributed to the massive drop in group revenues of 59% compared to same period q1 2014.

Anyone with any views to share on this?

Vested as of today.

[thinknotleft]

Hopefully, it can drop to 1.50-1.60, so that I can buy more to add to my position.

[vesfreq]

Hopefully, it can drop to 1.50-1.60, so that I can buy more to add to my position.

I'm not sure how you derived your basis of 1.50 to 1.60.

The core logisitcs business is very stable based on 778m (in 2011) to 987 m (in 2014). Assuming all else constant, the most apparent possible catalyst for a price drop has to be an immediate and sudden drop in commodity trading revenues. Then again, commodity trading margins are very thin 2 % and less. Lower commodity trading volumes may not necessarily cause a big dent, (for example, if) there is a major drop in revenues back to 2011 level of 1765 m from commodity trading. 2014, commodity trading made up 14 b of revenues.

Considering such a major drop in revenues, 2% margin (from commodity trading) will make a very big dent. Then again, that is catastrophic. Also, at the same time, the commodity division trades in all sorts of commodities, via MRI and Straits Financial. Its quite difficult to foresee an outright drop in demand for the full range of commodity products.

Having being designated as an approved LME warehouse operator also ensures that there is steady stream of demand for warehousing services. The recent port fraud was also to some extent to CWT's favour.
https://sg.finance.yahoo.com/news/port-f...13957.html

Assuming worst case of no commodity trading activity in fy2015 vs fy2014, the impact on net margin is approx 14b x 2% = 280m. That will wipe out net margins and result in a loss of 167k, assuming all else constant. Quite scary and unthinkable.

If commodity trading revenues in 2015 recedes to 2013's level of 8.1 b commodity revenues, net impact on net margin is about 8.1b x 2% = 162 m negative impact on bottomline margins. 162k impact seems like the worst possible. correct me if i'm wrong.

Comparing 2013 and 2014 results, even if commodity trading revenues retreat to 2013's 9b, CWT still managed a 108m of net margins. The risk of adverse impact due to fall in commodity trading volumes seems quite controlled.

Aside from fluctuation in commodity trading revenues, its quite hard to comprehend why prices should recede to 1.5- 1.6 level and its a significant drop by fri close of 1.88. Perhaps, there is another point of view that you could share?

Regards.