Ocean Sky International

[sgmystique]

OCEAN SKY HY 2011 NET PROFIT GREW 27.3% TO US$3.6 MILLION

* Proposes an interim dividend of S$0.008 per ordinary share
* Revenue rose 20.8% to US$65.3 million in 2Q 2011 from US$54.1 million in 2Q 2010 due to new customers and higher FOB unit prices
* Gross profit increased 22.1% to US$9.5 million in 2Q 2011 from US$7.8 million in 2Q 2010
* Net profit increased 28.4% to US$1.8 million in 2Q 2011 from US$ 1.4 million in 2Q 2010 due to higher revenue recorded


This has been another of my favorite stocks over the years. Ocean Sky has seen bad times (2008 was the worst year for them) but it seems to have gotten back on track since then. The results have been getting better consistently and so have the dividend payouts. The numbers are briefly summarized below:

____________________ 2008_______2009_______2010_______2011 (1st Half)

Revenue (US$mil):_____245.325_____207.422____228.268_____126.2
Net Profit (US$mil):____1.407_______4.256______8.333_______3.6
EPS (USD cents):______0.33________1.00_______1.96________0.84
Dividend (S$):_________0.0_________0.008______0.016_______0.008 (Interim Div)

The detailed numbers are available at:
http://oceansky.listedcompany.com/highlights.html

I have met up with CEO Mr. Edward Ang and he seems a decent and fairly straightforward person. He is quietly optimistic about Ocean Sky's performance going forward. I am quiet confident that this is not too risky an investment because the quality of clientele that Ocean Sky has is top notch (More information can be found in Mr. Ang's Chairman's message in Annual Report for 2010 - http://oceansky.listedcompany.com/chairman.html ). I intend to enjoy the consistent dividends till the share price is re-rated (CMP: S$0.125)...

[sgmystique]

There was a strong buy queue for Ocean Sky at 12.5 cents. The Ocean Sky share price has hardly budged since the market sell-down began. I guess existing holders find the S$0.008 dividend (Announced with the half yearly results) quiet attractive and are prepared to hold on for the longer term. Unless there is some major disaster Ocean Sky should be able to pay out another S$0.008 final dividend making for a very decent dividend yield of 12.8% for FY2011.

[sgmystique]

OCEAN SKY’S 3Q 2011 NET PROFIT JUMPED 163.0% TO RECORD-HIGH US$4.5 MILLION

* Revenue increased to US$94.1 million for 3Q 2011 due to higher FOB unit prices and sales to new customers
* Gross profit increased 47.2% to US$13.9 million for 3Q 2011
* Net profit increased 163.0% to hit US$4.5 million for 3Q 2011
* Net margins improved to 4.7% for 3Q 2011

The detailed numbers are available at:

http://info.sgx.com/webcoranncatth.nsf/V...4008246E5/$file/OSIL_3Q2011.pdf?openelement

This set of results has been most gratifying...Ocean Sky is quietly doing a very good job and it seems that business is getting better (Both topline and especially the bottomline) as the overall environment gets tougher.

US4.5 million in Q32011 is equal to what they had achieved in 9M2010. This growth is absolutely fantastic. Based on their announcement 4Q2011 should also be equally good. Continue to patiently hold on for a great final dividend (It was S$0.008 last year...hopefully should be better this year).

This is one silent performer in my portfolio...

[dydx]

I really can't understand why Ocean Sky's BOD would approve doing a share placement at such a low share price of $0.1443 (vs. a much higher NAV/share at USD0.1672, equivalent to approx. $0.209, for the existing shares) to raise a smallish net proceeds of only approx. $3.0m.....
http://info.sgx.com/webcoranncatth.nsf/V...90035EAA9/$file/OSIL_Placement_of_Shares_Announcement_2012.pdf?openelement

Equally strange, Maybank Kim Eng Corporate Finance is only willing to undertake the share placement on a best efforts basis, even though the placement price is fixed at a very comfortable approx. 9.9% discount to the weighted average price of S$0.1602 for trades done on 1Mar12. If there are not enough takers, Ocean Sky may end up receiving less than the $3.0m promised, but still is liable to pay a fixed $150k arrangement fee!

[cif5000]

I really can't understand why Ocean Sky's BOD would approve doing a share placement at such a low share price of $0.1443 (vs. a much higher NAV/share at USD0.1672, equivalent to approx. $0.209, for the existing shares) to raise a smallish net proceeds of only approx. $3.0m.....
http://info.sgx.com/webcoranncatth.nsf/V...90035EAA9/$file/OSIL_Placement_of_Shares_Announcement_2012.pdf?openelement

Equally strange, Maybank Kim Eng Corporate Finance is only willing to undertake the share placement on a best efforts basis, even though the placement price is fixed at a very comfortable approx. 9.9% discount to the weighted average price of S$0.1602 for trades done on 1Mar12. If there are not enough takers, Ocean Sky may end up receiving less than the $3.0m promised, but still is liable to pay a fixed $150k arrangement fee!

To drum up interest in this stock before the big acquisition so that they can pay using part-cash-part-stock, but only so if the stock is above NTA.

[sgmystique]

Wow!!! Ocean Sky has shot up to S$0.215 today. Really wondering what is the story...Anybody any clues...BTW I am surely not complaining...

[PeterSoh]

There's a query made by the Vice-President of SGX on the sgx website for Ocean Sky. Guess we'll have to wait for the CEO to reply to know the answer as to why this is happening.

[ValueBeliever]

it will be surprise to see who the major shldr coming on board? Is it a big placement just for existing majority shldrs or is it going to be to security house and place out to insignificant participant, which has no meaning to market?

Not sure what is going on? If security house push it up yesterday and then to dump the 23mil shares, the price would be back to where it was a long time back?

As SGX filing clearly show, the Co. doesnt need any money? So why the 23mil=3mil$? It is very confusing on where this placement event is leading to?

[john]

Ocean Sky Int
I'm a small holder & indeed surprised coy did a placement to hv just US3m, why can't they hv a rights issue to give small shareholders a chance to benefit the discount? I remember couple years ago they did same thing giving deep discount; when I queried management at AGM, they said it was to benefit some staff members. However, this latest placement which I expected it to erode the price instead it pushed it up, which is really puzzling! Can only quess that some influencial shareholder is coming on board?

[cif5000]

Ocean Sky Int
I'm a small holder & indeed surprised coy did a placement to hv just US3m, why can't they hv a rights issue to give small shareholders a chance to benefit the discount? I remember couple years ago they did same thing giving deep discount; when I queried management at AGM, they said it was to benefit some staff members. However, this latest placement which I expected it to erode the price instead it pushed it up, which is really puzzling! Can only quess that some influencial shareholder is coming on board?

The previous placement was to fund the acquisition of Bloom Time.
http://oceansky.listedcompany.com/newsro...140307.pdf

Previously, post-placement, the stock price stayed above the issue price until the GFC. The high was about 50% above. Today, the same is happening again.

We will have to wait for further announcements as "placement Shares must be placed out within 7 market days from the date of grant" of SGX approval.