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YHI International
14-05-2018, 06:56 PM,
Post: #61
RE: YHI International
Hi Mushy and Squirrel

http://infopub.sgx.com/FileOpen/YHI-FY20...eID=505580

Q1 boosted by one off gain.

1) will this profit be considered for dividend?
2) is it a concern that the operational profit seems lower than expected?

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16-05-2018, 09:55 AM,
Post: #62
RE: YHI International
(14-05-2018, 06:56 PM)bargainhunter Wrote: Hi Mushy and Squirrel

http://infopub.sgx.com/FileOpen/YHI-FY20...eID=505580

Q1 boosted by one off gain.

1)  will this profit be considered for dividend?
2)  is it a concern that the operational profit seems lower than expected?

1) I don't see why it will be excluded. Dividend has always been considered as a percentage of the profit attributable to shareholders.

2) I guess this should be a concern to all investors, but how much of it depends on the investment thesis. It will be a great concern for growth investors but for a value investor, maybe not so much. 

My reasons for buying this company is due to the deep discount to value that the company presents, the current trough that the industry is undergoing and the track record that the company and its management have presented in the past 10+ years (not a year of losses, that's pretty remarkable). From my point of view, I am investing into a company that is facing multiple headwinds over the pass few years. Intense overcapacity in China, EU wide tariffs on tyres, recent aluminium volatility due to RUSAL sanction etc. The company's response has been great so far, rightsizing their production, reducing the receivables through their 3R initiatives, renting out unused property, selling non strategic property in Australia.

I am currently holding onto a company that's trading at $0.455, worth $0.87 on books and $0.94 if you take into account the fair value markup in the Shanghai property. Even if we take the current $2m to be the norm over the next 3 quarters, we still get $11m of PAT for this year and a 4.2% dividend yield at current prices at 50% distribution. All this while waiting for the tide to turn and the company generating over $20m of operating cashflow every year.

I believe this is a waiting period for the worst to pass. Mushy has indicated as well that China is working on the overcapacity issue. As long as the company stays profitable, the discount will just get more and more attractive. Once the headwinds are gone, there will be then a very short period of time for the discount to vanish, and I would want to stay fully vested when that happens, all while being handed 3-4% dividends year on year.

Please do your own due diligence. Any reliance on my posts is at your own risk.

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16-05-2018, 01:29 PM,
Post: #63
RE: YHI International
(16-05-2018, 09:55 AM)Squirrel Wrote:
(14-05-2018, 06:56 PM)bargainhunter Wrote: Hi Mushy and Squirrel

http://infopub.sgx.com/FileOpen/YHI-FY20...eID=505580

Q1 boosted by one off gain.

1)  will this profit be considered for dividend?
2)  is it a concern that the operational profit seems lower than expected?

1) I don't see why it will be excluded. Dividend has always been considered as a percentage of the profit attributable to shareholders.

2) I guess this should be a concern to all investors, but how much of it depends on the investment thesis. It will be a great concern for growth investors but for a value investor, maybe not so much. 

My reasons for buying this company is due to the deep discount to value that the company presents, the current trough that the industry is undergoing and the track record that the company and its management have presented in the past 10+ years (not a year of losses, that's pretty remarkable). From my point of view, I am investing into a company that is facing multiple headwinds over the pass few years. Intense overcapacity in China, EU wide tariffs on tyres, recent aluminium volatility due to RUSAL sanction etc. The company's response has been great so far, rightsizing their production, reducing the receivables through their 3R initiatives, renting out unused property, selling non strategic property in Australia.

I am currently holding onto a company that's trading at $0.455, worth $0.87 on books and $0.94 if you take into account the fair value markup in the Shanghai property. Even if we take the current $2m to be the norm over the next 3 quarters, we still get $11m of PAT for this year and a 4.2% dividend yield at current prices at 50% distribution. All this while waiting for the tide to turn and the company generating over $20m of operating cashflow every year.

I believe this is a waiting period for the worst to pass. Mushy has indicated as well that China is working on the overcapacity issue. As long as the company stays profitable, the discount will just get more and more attractive. Once the headwinds are gone, there will be then a very short period of time for the discount to vanish, and I would want to stay fully vested when that happens, all while being handed 3-4% dividends year on year.

Thanks for your reply!   earlier you had been expecting $14m or more.  Do u still expect that to be achievable or do you think it may be closer to $11m?

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16-05-2018, 11:44 PM,
Post: #64
RE: YHI International
(16-05-2018, 01:29 PM)bargainhunter Wrote:
(16-05-2018, 09:55 AM)Squirrel Wrote:
(14-05-2018, 06:56 PM)bargainhunter Wrote: Hi Mushy and Squirrel

http://infopub.sgx.com/FileOpen/YHI-FY20...eID=505580

Q1 boosted by one off gain.

1)  will this profit be considered for dividend?
2)  is it a concern that the operational profit seems lower than expected?

1) I don't see why it will be excluded. Dividend has always been considered as a percentage of the profit attributable to shareholders.

2) I guess this should be a concern to all investors, but how much of it depends on the investment thesis. It will be a great concern for growth investors but for a value investor, maybe not so much. 

My reasons for buying this company is due to the deep discount to value that the company presents, the current trough that the industry is undergoing and the track record that the company and its management have presented in the past 10+ years (not a year of losses, that's pretty remarkable). From my point of view, I am investing into a company that is facing multiple headwinds over the pass few years. Intense overcapacity in China, EU wide tariffs on tyres, recent aluminium volatility due to RUSAL sanction etc. The company's response has been great so far, rightsizing their production, reducing the receivables through their 3R initiatives, renting out unused property, selling non strategic property in Australia.

I am currently holding onto a company that's trading at $0.455, worth $0.87 on books and $0.94 if you take into account the fair value markup in the Shanghai property. Even if we take the current $2m to be the norm over the next 3 quarters, we still get $11m of PAT for this year and a 4.2% dividend yield at current prices at 50% distribution. All this while waiting for the tide to turn and the company generating over $20m of operating cashflow every year.

I believe this is a waiting period for the worst to pass. Mushy has indicated as well that China is working on the overcapacity issue. As long as the company stays profitable, the discount will just get more and more attractive. Once the headwinds are gone, there will be then a very short period of time for the discount to vanish, and I would want to stay fully vested when that happens, all while being handed 3-4% dividends year on year.

Thanks for your reply!   earlier you had been expecting $14m or more.  Do u still expect that to be achievable or do you think it may be closer to $11m?

I will just take $11m as a base case for now and wait to be pleasantly surprised. From the AR it seems that YHi is commited to leasing the Shanghai property for ten years so strategically there is jo reason to hold it (since they cant just restart the manufacturing). Given that being a landlord is not in their core business, and historically they have shown willingness to sell non core assets, the only reason to hold is the view that it will further appreciate. Perhaps we might get surprised here.

Please do your own due diligence. Any reliance on my posts is at your own risk.

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17-05-2018, 12:09 PM,
Post: #65
RE: YHI International
Chitchat with Tay T.G during the post-agm. He explained no plans to divest the Shanghai factory as the capital gain tax is 67%. $100 profit takes back only $33 in pocket.

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18-05-2018, 09:52 AM,
Post: #66
RE: YHI International
(17-05-2018, 12:09 PM)nitro Wrote: Chitchat with Tay T.G during the post-agm. He explained no plans to divest the Shanghai factory as the capital gain tax is 67%. $100 profit takes back only $33 in pocket.

thanks for the info.  rental seems good though.

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22-05-2018, 07:47 AM,
Post: #67
RE: YHI International
Indeed, rental is giving us 1% dividend yield a year on the counter, can’t really complain.

Please do your own due diligence. Any reliance on my posts is at your own risk.

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