Singapore Press Holdings (SPH)

[brattzz]

20cts final dividend. Total of 27 cts dividends for 2010.

Good good!

Dividends History,

2005
Apr 8.75c
Dec 19c

2006
May 7c
Dec 17c

2007
May 7c
Dec 19c

2008
May 8c
Dec 19c

2009
May 7c
Dec 18c

2010
May 7c
Dec 20c

[valuestalker]

Few points to consider:
1. Staff cost is moving up & one time staff bonus will be paid on Jan 2011.
Note: staff cost is their biggest cost component, hence we shall expect a lot LOWER H1 2011 profit.
2. Property development revenue dried up
Not sure whether they will manage to get a good value property bid
(Singapore property market is kind of pricey at the moment).
3. Improving Ads revenue
4. Higher Printing cost which will be partially offset by higher SGD
5. Expanding in Exhibition and MICE (although not a signification contribution to a revenue at the moment)

[Drizzt]

it is not a press house any more really. so char pa lang.

if u look at its core business, what do you guys think? i am more tech savvy and i don't read the straits times for 4-5 years. would their online subscription have good viewership?

i suppose ad revenues will continue to be high but do we have long time straits times readers that care to comment?

[valuestalker]

Hi Drizzt,

Agree that their moat in media is fading.

But, let's say if we are the management, what could we do??
For me, the conservative management will:
1. Digitalized (or rather Internetized) the traditional media business
(which, if i am not wrong, is losing money now)
2. Diversify the business by
* Expands Exhibition business
* Grabs other opportunities as it raises (Property, Commercial, Shopping Centre).

For me, their biggest asset for now is their management, and it is really qualitative to say the least.

[violinist]

A 3-line classified ad will still get you tons of phone calls, I don't think any internet site is as good.

[brattzz]

1) EPS 2010 is 31 cts, going at past few days share prices of maximum $4.28 - $4.18, the P/E is 13.8.
2) 2010 Dividend Yield is 7ct + 20ct = 27cts or 6.3%, pretty decent i think.
3) SGD$1.5B investible cash... aiming for Jurong East White site development? rumors!

Almost all the major analysts "writes down" this counter in view of less revenue coming in 4Q and 2011.
Most are guessing that EPS and dividends will be coming down also.

I think it's a decent buy-in though!

(I am vested!)

[valuestalker]

I believe it is sort of CONFIRMED that next year profit will be down by at least 10%.
Due to the stop of revenue stream from SkyEleven (TOP in May 2010).
Clementy Mall will only launch in Jan-Mar 2011, most probably will contribute to H2 2011 on ward.

The current dividend payout ratio is about 80%.
Not sure whether the dividend yield will be sustainable next year.

Catalyst:
Manage to bid new property in not too high valuation.
Ads, circulation & MICE business picks up strongly.

[brattzz]

with $1.5B warchest, think it will go into sub-urbans malls operations for steady rental yields...
clementy mall is in west, next aim jurong east mall? and Jurong lake district also?

[Drizzt]

the moat is still there because locally perhaps newspaper advertising provides very good visibility. however, i still think the management knows that this will not be for long thats why they become a char pa lang soon.

[valuestalker]

the moat is still there because locally perhaps newspaper advertising provides very good visibility. however, i still think the management knows that this will not be for long thats why they become a char pa lang soon.

Which is most probably the only thing they can do.