800 Super

[SpaceX]

Even exclude the one off gain,earing is still up by 33%

[zheshi]

The Growth for this Stock is very nice with high return of ROE. But the Debt of it, is also very scary.

It borrowing is increasing year by year, is it like using more borrowing to increase it profit.

At a lost now, on wether to invest in this or not.

[CityFarmer]

The company has exhausted the growth in its core biz?

(not vested)

800 Super and Zero Spot Laundry Service in joint venture to provide laundry services

SINGAPORE (Nov 5): 800 Super Holdings ( Valuation: 2.40, Fundamental: 1.70) has entered into a non-binding memorandum of understanding (MOU) with Zero Spot Laundry Services to incorporate a new joint venture (JV) company.

The JV company will undertake the business of providing laundry services to hospitals as currently conducted by Zero Spot. It will also take on any other laundry services engagements in Singapore.

800 Super will hold a 60% stake in the JV company while Zero Spot will take a 40% shareholding.

Zero Spot provides professional laundry services to hospitals, hotels and serviced apartments in Singapore and Asia.
...
http://www.theedgemarkets.com/sg/article...y-services

[karlmarx]

The official announcement from 800 Super can be found here:
http://infopub.sgx.com/FileOpen/800%20Su...eID=376882

The bigger plan is to construct a waste-to-energy plant by 2017 which the company can use to incinerate the waste they collect daily, on their own. This will cut cost from sending their waste to the other incinerators, which charge about $70 a ton.

The heat generated from the incineration can be used to generate steam, which will likely be used to run turbines, thereby producing electricity. This is where the JV comes in. The JV hopes to make use of the steam generated for laundry. I see this as the company's way of being efficient in its use of 'byproducts.'

With regards to the high debt levels, I believe much of it is for the waste-to-energy plant, as stated in the AR. Though it does not state how much capital investment has been made for this purpose.

[grandjedi]

Hi,

Seems like 800 Super is not looking quite attractive again at $0.44. Appreciate any other views or insights...

[karlmarx]

800 Super began reporting its results quarterly.

3Q2016 Results can be found here:
http://infopub.sgx.com/FileOpen/800%20Su...eID=404357

The growth story continues for 800 Super, as its 9M net profit grew from $9.6mil (excluding divestment gain from property sale) from the previous year to $12.4mil.

A net profit of $7.5mil was registered this quarter, on lower costs and higher revenue. This is higher than the net profit of $4.9mil for HY2016. But should come as no surprise. From past results, it has been a trend for its 1st 6M results to be poorer than its next 6M results.

If we can expect its net profits for 4Q2016 to be similar to 3Q2016, the net profit for FY2016 could be up to $20mil. An 8 times earning multiple of this will then value 800 Super at about $160 mil. At today's closing price of $0.48, 800 Super is valued at $85mil.

[ksir]

800 Super began reporting its results quarterly.

3Q2016 Results can be found here:
http://infopub.sgx.com/FileOpen/800%20Su...eID=404357

The growth story continues for 800 Super, as its 9M net profit grew from $9.6mil (excluding divestment gain from property sale) from the previous year to $12.4mil.

A net profit of $7.5mil was registered this quarter, on lower costs and higher revenue. This is higher than the net profit of $4.9mil for HY2016. But should come as no surprise. From past results, it has been a trend for its 1st 6M results to be poorer than its next 6M results.

If we can expect its net profits for 4Q2016 to be similar to 3Q2016, the net profit for FY2016 could be up to $20mil. An 8 times earning multiple of this will then value 800 Super at about $160 mil. At today's closing price of $0.48, 800 Super is valued at $85mil.

If i got it correctly, for Colex, the first 3 months of the calendar year is always the strongest. I wonder why is that so?

<vested in colex, interested in 800>

[Shrivathsa]

I am not an expert in this, but i can make two guesses

1) The first is that after the year is over, the management will recognize the bonus for the year which has just finished in the first 3 months of the following year. (From MOM Guidebook on Sourcing : If Tender achieves >90% score, an incentive of 5% of price to be awarded at the end of the contract 3 months which is to be shared with workers)

2) The second would be that the new price for a year (factoring in escalation clauses) would kick in from the first quarter (From 800 Super Annual Report "The increase in revenue was mainly contributed by renewal of existing contracts at revised pricing")

[Yoyo]

My guess - the higher 1 Qtr result in the past years have to do with this - Wage Credit Scheme

The Wage Credit payout is a government grant that co-funds wage increases and hence it is a revenue that is taxable in the hands of the employers.
When is the payout
Payouts will be given to employers by 31 March 2014, 2015, 2016, 2017 and 2018.
How do employers receive the payout
Payouts will automatically be credited to employers' GIRO bank account for Income Tax/GST, or by cheque.

https://www.iras.gov.sg/IRASHome/Schemes...eme--WCS-/

[Shrivathsa]

Yep, that makes sense