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(09-02-2012, 06:22 PM)shanrui_91 Wrote: FY result is out.
Total profit increased by 14.2% and cash balance increased by 6 million.
Rev for both segment increased by 10%
Final dividend of 10.7 cents declared.
"GROUP OUTLOOK
The number of vehicles due for inspection is expected to remain high as the de-registration rate of
vehicles continues to be low.
With a comprehensive range and variety of services, it is expected that the test and inspection business
will continue to sustain its performance despite the anticipated economic slowdown."
Thanks shanrui for pointing out about the results release.
Vicom's trade receivables increased a whopping 51.8% when their revenue increased only by 8.1% and profits increased by 14.2%. Cash flow from ops increased only 10.2%. Something is amiss here. It is stated in the report that "The higher Trade Receivables as at 31 December 2011 arose mainly from higher billings in the last quarter 2011".
Under "Segment Information" (pg 12), Vicom didn't break down their revenue from "Vehicle Assessment" and "Rental Income" unlike in FY2010 report. I think this year, they lumped the "Vehicle Assessment" revenue under "Vehicle Inspection" and "Rental Income" revenue into "Other related business".
Their "Non-Vehicle Testing and Inspection" business revenue dropped slightly to 60.69% from 61.08% the previous year. Their "Vehicle Inspection" business revenue increased slightly to 31.11% from 30.39% the previous year.
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(09-02-2012, 07:36 PM)FFNow Wrote: (09-02-2012, 06:22 PM)shanrui_91 Wrote: FY result is out.
Total profit increased by 14.2% and cash balance increased by 6 million.
Rev for both segment increased by 10%
Final dividend of 10.7 cents declared.
"GROUP OUTLOOK
The number of vehicles due for inspection is expected to remain high as the de-registration rate of
vehicles continues to be low.
With a comprehensive range and variety of services, it is expected that the test and inspection business
will continue to sustain its performance despite the anticipated economic slowdown."
Thanks shanrui for pointing out about the results release.
Vicom's trade receivables increased a whopping 51.8% when their revenue increased only by 8.1% and profits increased by 14.2%. Cash flow from ops increased only 10.2%. Something is amiss here. It is stated in the report that "The higher Trade Receivables as at 31 December 2011 arose mainly from higher billings in the last quarter 2011".
Under "Segment Information" (pg 12), Vicom didn't break down their revenue from "Vehicle Assessment" and "Rental Income" unlike in FY2010 report. I think this year, they lumped the "Vehicle Assessment" revenue under "Vehicle Inspection" and "Rental Income" revenue into "Other related business".
Their "Non-Vehicle Testing and Inspection" business revenue dropped slightly to 60.69% from 61.08% the previous year. Their "Vehicle Inspection" business revenue increased slightly to 31.11% from 30.39% the previous year.
Hi FFNow,
Vicom explained that the higher receivables were mainly due to the higher billing in the last Qtr of 2011.
From what I understand, typically businesses would try to pay their payable as late as they can to help with their cash flow. Hence, Vicom will only get their receivables late.
By the way, may I know how did you get the 51.8% increase? I was unable to get that number.
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Trade receivables increase by 3m to 10m, but this has already decreased from 12m in q1 2011. Days sales outstanding is at 42 days and which i feel is still comfortable given that revenue increases by 7m. This is likely to be coming from SETSCO rather than the vehicle inspection business. 51.8% increase is 3/7 *100
As for cash flow, I have mentioned before that under normal circumstances, VICOM is able to generate a FCF/ Net Profit of at least 105%. 2010 and 2011 show an increase of around 7m in capex from 4m to 11m. This is largely due to the construction of a new building cum laboratory at Teban Garden. This sum can be accounted for by the "Capital Work-In-Progress" of 9m in the annual report 2010. With its completion, I expect FCF/ NEt profit to be higher than 100%. In fact, 120% was achieved when it did not have to build CDST and VETL facilities.
As for the lumping up into other related business, they started out with 5 segments. One of them, Vehicle assessment business, has dropped significantly after new ruling stated that approved workshop other than VICOM and STAI can be used to report accident. Revenue has dropepd significantly and thus it was put into other business. It makes sense though since SETSCO and VICOM are their core businesses.
Revenue for both segments increase but VICOM increases a bit more than SETSCO given the ageing of vehicle population and closure of 1 STAI centre in August.
My only concern will be the share options, which resulted in an increase of share capital by $3m to $34m.
http://sgyounginvestor.blogspot.com/2012...pdate.html
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(09-02-2012, 08:12 PM)natnavi Wrote: By the way, may I know how did you get the 51.8% increase? I was unable to get that number.
I took (10,530 - 6,935)/6,935 = 0.518 (or 51.8%)
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(09-02-2012, 09:11 PM)FFNow Wrote: I took (10,530 - 6,935)/6,935 = 0.518 (or 51.8%)
Thank you FFNow.
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sold some at 4 flat yesterday to take profit..going by this bull, i feel it may go up higher
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At the current price of $4.00, EV/net profit is around 11.75. Going forward, I will wish that the stock will rise in proportion to its profit growth, while I will continue to enjoy the ~4% dividend. Anyway, VICOM has a low beta of around 0.45, so do not expect it to spike up in tandem with STI.
(vested)
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When more people understand the attractiveness of the business, the stock will become less undervalued, up to a point when the price is more than fair. We are almost there...keep it up.
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Vicom, Cerebos, APB, etc... all are low beta and very low liquidity category of stocks. Beware of the low liquidity of this type is most important. 
WB:-
1) Rule # 1, do not lose money.
2) Rule # 2, refer to # 1.
3) Not until you can manage your emotions, you can manage your money.
Truism of Investments.
A) Buying a security is buying RISK not Return
B) You can control RISK (to a certain level, hopefully only.) But definitely not the outcome of the Return.
NB:-
My signature is meant for psychoing myself. No offence to anyone. i am trying not to lose money unnecessary anymore.
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(12-02-2012, 11:10 AM)Temperament Wrote: Vicom, Cerebos, APB, etc... all are low beta and very low liquidity category of stocks. Beware of the low liquidity of this type is most important.
Vicom, Cerebos and APB are rise and rise stocks. Earned shareholders lot of money over the last 10 years and should belong to the top group in term of return.
I own none but ring me up when they are trading at half the current price, say 2 - 2.50 for vicom.
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