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I have just finished reviewing TTJ's latest FY11 (ended 31Jul11) AR, which is most interesting as it contains the success story of its founder....
http://info.sgx.com/listprosp.nsf/6c6be9...5000e011e/$FILE/TTJ%20AR11_final%20lowres.pdf
The AR should be a good weekend reading. More background info on TTJ.....
http://www.ttj.com.sg/corporate/
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I just chanced upon Centurion Corp Ltd (previously known as SM Summit Holdings Ltd)'s Circular to Shareholders dated 30Jun11 concerning their recent acquisition of a foreign workers' dormitory business and related assets.....
http://info.sgx.com/listprosp.nsf/5ec09b...f00309c4b/$FILE/SM%20Summit-Cir.pdf
In Appendix H of the Circular is a Jones Lang LaSalle report entitled "SINGAPORE FOREIGN WORKER DORMITORY MARKET STUDY" which makes interesting reading.
TTJ's 5,300-bed "Terusan Lodge 1" leasehold (expiring Jan2017) workers' dormitory property located at 5A Jalan Papan in Jurong, is listed in Appendix 2 of the report under the "TEMPORARY DORMITORIES" category. Based on TTJ's latest AR, this investment property was carried in the 31Jul11 B/S at a NBV of $13.365m.
Workers' dormitories are valuable assets mainly because of their ability to generate solid rental income at a prevailing rate of over $200/bed a month. In Appendix I of the same Circular, Chesterton Suntec International in its valuation report has attached an Open Market Value of $103.0m to Centurion Corp's existing 5,363-bed (arranged in 448 units of workers’ dormitories) Westlite Dormitory on leasehold (46 years remaining) land located at 12 to 28 Toh Guan Road East, on an existing use basis.
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Today (5Dec11) is the first market day TTJ goes 'XD' for the $0.006/share Final dividned for FY11 (ended 31Jul11), and the share price stayed steady, together with a rather long 'buy' queue and only a single seller, all in a depressed market day. Good!
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Based on the report (re-produced below in full) in today's BT, another 2 new opportunities of potential large structural steel fabrication contracts - (1) Hyflux's $890m 2nd desalination plant named "Tuaspring", and (2) GMR's (of India) $1.2b, 800-MW GMR Energy plant - in Jurong island have emerged for TTJ.....
Published December 14, 2011
Hyflux enters power business
It has commissioned a power plant where excess capacity will be sold to local grid
By RONNIE LIM
HYFLUX is now officially in the power business, having just awarded a deal this month - reportedly worth some US$300-400 million - to Siemens to supply it with a 411-megawatt power plant.
This is to provide power to Tuaspring, its second, and largest desalination plant project here, costing S$890 million.
Siemens received the order on Dec 1 from Hyflux subsidiary, Hydrochem (S) Pte Ltd, to supply, construct and commission the power block and other main components for the new combined cycle gas turbine plant.
BT reported in October that Hyflux had secured gas feedstock for the environment-friendly CCGT plant, having recently signed a gas sales agreement for an undisclosed volume of liquefied natural gas with Singapore's LNG aggregator, BG Group.
Apart from providing the Tuaspring facility with power, the CCGT plant will also draw cooling water from the sea to the desalination plant, thus optimising the balance of energy for the overall plant, reports by various specialist power publications said.
Siemens is also reported to have concluded a long-term service agreement with Hydrochem for the plant. While Hyflux did not put a value to the Siemens deal, the specialist news reports put it at 200-300 million euros (S$343-515 million).
'We view this first order from Hyflux to be a demonstration of their trust in our know-how and technology,' PennEnergy quoted Lothar Balling, head of Gas Turbine Power Plant Solutions at Siemens, as saying.
'Siemens places the greatest value on tried-and-tested and highly reliable technology, and this will be a decisive factor on the electricity market in Singapore.
'With an efficiency of approximately 59 per cent, the Tuaspring plant will contribute significantly towards securing Singapore an efficient, and thus economical, as well as clean power supply.'
Apart from Hydrochem, Siemens is also supplying the power plant to new player GMR of India, which is currently building a S$1.2 billion, 800-MW GMR Energy plant on Jurong Island.
Sources have said that construction of Tuaspring would start this year-end, although this may be deferred slightly given the late award of the power portion to Siemens this month. The Tuaspring facility is now reportedly slated to go online in 2014.
When operational, the facility will produce 70 million gallons of desalinated water per day, to be supplied to the PUB under a 25-year agreement.
The 411-MW Hydrochem power plant will have extra capacity even after supplying both Tuaspring and Singspring next door - the first desalination plant in which operator Hyflux has a 30 per cent stake, sources indicated. But Hyflux has indicated that excess power would be sold to Singapore's power grid."
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From the look of the little extra volume transacted from 1500hrs this afternoon, TTJ appears quite set to do better in this new year. On the structural steel business side, I guess there should be more - and hopefully big ones too! - new order wins to be announced, and higher profits in this FY12 (ending 31Jul12). May be also a little positive surprise from the new activity of property development which should be on a small scale. On the other hand, the workers' dormitory business should continue to bring in good and steady profits and cash flow, and acts as a strong ballast for the group.
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Just checked my bank account and noted a nice credit dated 22Dec11 (which I have missed because of all the year-end engagements and trips) from TTJ's $0.006/share Final dividend for FY11. The money comes in handy for the coming CNY shopping and feasting!
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TTJ plans to utilise approx. $4.0m in unutilised IPO proceeds for the strutting business which seems to have good market opportunities in the near-to-medium term....
http://info.sgx.com/webcoranncatth.nsf/V...3003460C7/$file/Announcement-changeinuseofIPOproceeds.pdf?openelement
Is providing strutting to construction sites a good business? Would forumers who work in the construction industry care to share some insights?
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TTJ has secured another approx. $19.0m worth of contracts for structural steelworks, civil defence shelter doors and other services.....
http://info.sgx.com/webcoranncatth.nsf/V...D00345BCF/$file/Announcement19millionnewcontractssecured.pdf?openelement
Without doubt, TTJ will be kept very busy in FY12 (ending 31Jul12) and FY13, enabling its expanded production capacity to run at a high and optimal level, and giving the possibility to produce higher profits and profitability. How high will TTJ's NP go in FY12 and FY13, I wonder. [ Note: In FY11 (ended 31Jul11), TTJ posted a record NP of $14.424m and EPS of $0.0412.] The coming 1H (ended 31Jan12) results should provide a good indication.
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24-02-2012, 08:58 PM
(This post was last modified: 24-02-2012, 08:59 PM by dydx.)
Foreign workers dormitory investment company Centurion Corp. has contracted to buy an 85% interest in Dormitory Investments P/L, which owns and operates the 8,600-bed Tuas Dormitory located at 90 Tuas South Ave 9, Jurong, for $40.375m in cash, or approx. $5,523 per bed.....
http://info.sgx.com/webcoranncatth.nsf/V...E003655E2/$file/Centurion-SPA-DIPL-240212.pdf?openelement
Tuas Dormitory is a temporary dormitory under a 3+3+3 year land lease from the BCA with a remaining lease of approx. 5 years.
As a direct comparison, TTJ's 5,300-bed Terusan Lodge 1 workers dormitory located at 5A Jalan Papan, Jurong, is also a temporary dormitory under a 3+3+3 year land lease from the BCA which expires on 12Jan17, i.e. also with a remaining lease of approx. 5 years. In TTJ's latest FY11 (ended 31Jul11) AR....
http://info.sgx.com/listprosp.nsf/6c6be9...lowres.pdf
under Note 16 "Investment Property" in p64, Terusan Lodge 1 was carried at a NBV of $13.365m (being depreciated on a straight-line basis at a rate of approx. $2.5m p.a. over its remaining lease period). It latest written-down NBV should be approx. $12.0m.
If we use Centurion Corp.'s latest transacted price of $5,523 per bed as a valuation basis, the CMV of 5,300-bed Terusan Lodge 1 should be approx. $29.3m. Against its latest written-down NBV of approx. $12.0m, there is hidden potential surplus value of $17.3m, or approx. $0.049/share, based on TTJ's latest 350.0m outstanding issued shares.
Should TTJ sell Terusan Lodge 1 at the going market valuation? I would rather TTJ keeps this very profitable asset which is probably generating a total rental and service income in excess of $12.0m a year (based on FY11's $12.076m).
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This morning (8Mar12) at 09:53:14hr, there was 1 single very large transaction of 923 lots done at $0.17. It appears a serious buyer/investor bought the shares from a large minority shareholder who needed money in a little hurry.
How I wish I had the spare cash and was in the shoe of this resolute buyer!
TTJ is due to release its 1H (ended 31Jan12) result by 15Mar12.
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