Ossia International Limited

[¯|_(ツ)_/¯]

9 Sep 2020@1852hrs - Div $0.9
10 Sep 2020@1114hrs - Div $0.009
10 Sep 2020@1120hrs - halt
10 Sep 2020@1639hrs - clarify on Div
10 Sep 2020@1645hrs - trading resume
https://links.sgx.com/FileOpen/OIL%20-%2...eID=631181

Stay home and stay healthy, everyone.

[dydx]

FY21 full-year results..
https://links.sgx.com/FileOpen/Full%20Ye...eID=668227
Another $0.01/share final dividend declared. This is the 4th year in a row (from FY18) Ossia has paid out dividends, which total $0.0357/share in the last 4 years, giving an average of $0.008925/share a year. Pretty good showing.

[ghchua]

Hi dydx,

Indeed. Pertama continued to be the star performer for Ossia, contributing a big chunk of their profits. With movement restrictions being implemented lately in Singapore and Malaysia due to resurgence of Covid-19 and people are stuck at homes, I think Harvey Norman brand will continue to do well as they cater for furniture, bedding, computers, communications and consumer electrical products.

But the problem with Ossia is that they are still stuck in the SGX watchlist and faced delisting risk. Being profitable and paying dividends for the past few years is not good enough to get out of it. They have to achieve at least $40m market cap and I don't see them achieving it in the near term as interest in the stock had been low. Besides being profitable and paying dividends, I think the company should engage investors more in order for the market to realize its value. Its a chicken and egg problem. Being in the watchlist might put off some investors and thereby share might continue to be depressed as they continue to be in the watchlist.

[¯|_(ツ)_/¯]

Ossia@10.9cents

I took a quick look at this FY result and I'm very impressed.
It's worth reading more.

I then take a quick look at FY2020 AR and I'm equally impressed.

The one and only one thing that stopped me is it's business:
Established since 1982, Ossia is a leading regional distributor and retailer of lifestyle, outdoors, luggage and accessories products. 

Ossia was listed on the main board of Singapore Exchange Securities Trading Limited (SGX-ST) on 20 November 1996. 

The Group subsidiary in Taiwan has exclusive distribution rights for the Kango, True Religion, Tumi, Columbia and Sorel brands. 

The Group subsidiaries in Malaysia have ceased operations since January 2019 and are currently dormant. 

The Group holds an effective 19.8% stake in Pertama Holdings Pte. Ltd., a leading retailer of consumer electronics and home furnishings trading under the Harvey Norman brand in Singapore and Malaysia.

Stay home and stay safe, everyone.


Summary:
Ossia had met all the tick.
The only one drawback (after 10mins of digging) is C19 headwind.
At this moment, I sense that there are too much optimism baked into C19 recovery story.


Thank you dydx san for such a wonderful introduction to Ossia.
Gratitude.

[ghchua]

At this moment, I sense that there are too much optimism baked into C19 recovery story.

Hi ¯|_(ツ)_/¯,

Ossia is not a stock to bet for Covid-19 recovery. In fact, the longer Covid-19 drags on, it might actually benefit Pertama as people now stay at home for a longer duration and they might replace more old consumer electronics products and home furnishings at home with new ones.

[dydx]

The creative use of low-cost and effective social media - Youtube in this instance - in marketing towards all sectors and different audiences..
https://www.youtube.com/channel/UCSIVmh5...6wjy3BKdAg

Harvey Norman SG and Harvey Norman MY (both 19.8% owned by Ossia International) have them all - Youtube, Facebook, Twitter, Instagram, LinkedIn, Pinterest.

So far Harvey Norman SG has made 5 short videos under their (trade-marked) "Modern PCs" series..
https://www.youtube.com/watch?v=s00W30yj...eR1ZYo5Zhk
They have creatively used the stories of real-life Singaporeans to educate/promote the use of smart laptops in one's endeavours in work, play and even charity..

[¯|_(ツ)_/¯]

Ossia
Thanks GH and dydx san,

This is my thought:
1. Ossia did demonstrated it's resiliency amid the C19 crisis.
2. It is true that people are paying more attention and retrofitting their "HOME" during C19 crisis. I am quite sure you did that too.
3. It is also true that IKEA open a third (thou smaller) store in Singapore JEM (by LandLease).  This is again during the C19 pandemic.
4. Not only in Singapore, says in Indonesia, Giant supermart will be shutdown and replaced by IKEA too. 

Ok, I'm not thinking now, but my instinct after I spend 10mins quick scan of FY2021 result announcement and FY2020 annual reports is not to proceed further.

Again, I'm not thinking now, but my instinct told me that I would not be spending more time in Ossia, at least not the next few months...
for a simple reason... I had already identify more attractive stocks to buy.

Don't mind I side track a bit.
1. There are a significant number of valuebuddies with engineering or computer science background.
2. Relatively, valuebuddies posted much less in Tech stocks than non-tech.
3. Obviously, SGX lack tech stocks (other than few famous high tech precision engineering counters like MM) would be the reason why there are not so much discussions on Tech stocks.
4. Obviously, those high growth Tech stocks exist and there might still be some worth looking aka not buying now but watching for the right time to buy.

And, I'm spending my time in this area now.
The first one I brought is GME (divested).
The second one I brought is PLTR (accumulating).
I'm looking at a third one which I can't decide whether to buy the steady mother company or her fast growing daughter or both?

This will take some time.  My thinking is inclining to both but this is too sloppy and I need to study enough to make a decision.  I don't know, I could still start with both and then adjust along the way.  

In any case, I enjoy the process and especially GH, I had been your vivid reader every month and I understand your process and I too saw the evolution too.  Thank you for sharing your thought process, I learn a lot from you.

Gratitude!

[dydx]

How valuable is Ossia's 19.8% equity interest in the combined Harvey Norman SG/MY's business held under Pertama Holdings P/L? It is a bit difficult to assess, as the 19.8% effective interest is held under Harvey Norman Ossia (Asia) Pte Ltd - a 60/40 j-v (60% Harvey Norman Holdings Ltd, listed on ASX; 40% Ossia) - which holds a 49.4% interest in Pertama Holdings.

From Ossia's latest results, in the P&L Ossia booked $4197k as its 40% share of Harvey Norman (Asia) P/L's aftertax profit. From the Group Cash Flow statement, presumably most of the $2568k in dividends received is also derived from Harvey Norman (Asia). By applying a PER of say 9X, Ossia's 19.8% effective interest in Pertama can be worth close to $38.0m (vs. BV at $27.0m).

Those who are interested to find out more about the latest scale, expansion plans, revenue and profit numbers of the Harvey Norman SG/MY's business can try dig into ultimate parent Harvey Norman Holdings' results and disclosures..

[dydx]

Actually, the main attraction in Ossia is the 19.8% effective equity interest in the Harvey Norman SG and MY business (held under Pertama Holdings P/L), which is growing in size, profits, and value, and pays out regular dividends, ultimately for the benefit of Ossia's shareholders.

Covid should help the Harvey Norman's well-established omni-channel retail business - which is backed by a great website and effective use of social media marketing - as most households upgrade their home working environment. The continued strong demand for new residential properties big and small in SG should bring more business volume. Margins should improve too when demand is strong. Lastly, retail rent trending downwards should also boost profitability in the next few years.

If and when Harvey Norman Holdings (Australia) buys out Ossia's 29.8% interest, it should be very nice for Ossia's shareholders.

[ghchua]

Actually, the main attraction in Ossia is the 19.8% effective equity interest in the Harvey Norman SG and MY business (held under Pertama Holdings P/L), which is growing in size, profits, and value, and pays out regular dividends, ultimately for the benefit of Ossia's shareholders.

Covid should help the Harvey Norman's well-established omni-channel retail business - which is backed by a great website and effective use of social media marketing - as most households upgrade their home working environment. The continued strong demand for new residential properties big and small in SG should bring more business volume. Margins should improve too when demand is strong. Lastly, retail rent trending downwards should also boost profitability in the next few years.

If and when Harvey Norman Holdings (Australia) buys out Ossia's 29.8% interest, it should be very nice for Ossia's shareholders.

Hi dydx,

Your points here are all valid. But as I have pointed out in my earlier post, Ossia is currently in SGX watchlist. To get out of the list, Ossia not only need to be profitable, but they also need to meet $40m market cap requirement.

Being in the watchlist had deterred some investors from investing in the company, as there is a risk of it being delisted for failing to meet the SGX watchlist exit requirement.

Would certainly like to hear your views on this issue.