San Teh

[Behappyalways]

OBITUARY
http://infopub.sgx.com/FileOpen/Obituary...eID=308158

[cyclone]

The Founder and Executive Chairman, Mr. Kao Shin Ping, had passed away peacefully on 3 August 2014. My sympathy goes out to the family.

---

The roles and duties of the late Executive Chairman would be assumed by the Chief Executive Officer cum Deputy Chairman, Mr. Kao Chuan Chi, with immediate effect.

[greengiraffe]

RIP...

The Founder and Executive Chairman, Mr. Kao Shin Ping, had passed away peacefully on 3 August 2014. My sympathy goes out to the family.

---

The roles and duties of the late Executive Chairman would be assumed by the Chief Executive Officer cum Deputy Chairman, Mr. Kao Chuan Chi, with immediate effect.

[pianist]

oh dear, what happened to him, he looked in the pink of health in the annual report. my condolences to his family

[Behappyalways]

one might need to reassess the company with the demise of Mr Kao

OBITUARY
http://infopub.sgx.com/FileOpen/Obituary...eID=308158

[ngcheeki]

Currently, San Teh has 2 segments, namely Hotel and Property, PVC Pipes and Fitting. It own and operate 2 hotels (4 and 5 stars), 1 in Nantong in Jiansu (255 rooms) and the other resort hotel in Suzhou (Tai Hu) 191 rooms, however both of these hotels are not making $$. As for the PVC pipes business, it is marginally break even or suffer a slight loss for the past 2 years.

My interest in this company is not the hotel and PVC business but the properties under development which is almost completed in 4QFY2014 Shanghai Anting as well as their BT (build-and-transfer) mass market properties in Fujina Anxi (3QFY2014, yes this coming quarter).

My vested interest in this company is because of the following reasons:

1. The completion of developments projects (Anting and Anxi in the next 2 quarters) after of 2 to 3 years of construction as well as the recurring incomes these properties going to generate for the coming quarters. See the following for more details.

2. The financial of San Teh is very strong and currently trading only at 0.5X price to book with net cash of 12 cents as well as short and long term investment securities of 20+ millions which can be liquidated. The dividend yield for the company is not too bad for the last 3 years of 1 to 0.8 cents per share even though the company is not making much profit.

3. In addition, this company has many leased properties in china (Jiang Su, Yunan and shang hai) and all of them are at cost.

As for the Anting project, the following is the detail for your reference.

"The site of the Anting redevelopment project is located approximately 40 km from the city of Shanghai. Under the project, our existing office building and its surrounding land will be redeveloped into a property complex (namely Santeh Commercial Plaza), which will consist of: (i) a business hotel with 168 rooms and equipped with, inter alia, lobby, business centre, café restaurant, and meeting rooms; and (ii) a four-storey shopping mall with a total built-in area of approximately 23,000 sqm and a 10-storey Small Office / Home Office apartment block (where the units can be used for residential-cum-office purposes) consisting of 80 apartment units with a total built-in area of approximately 7,700 sqm. The project is estimated to cost RMB200.0 million (approximately S$40.0 million) and is expected to take two years to complete."

http://infopub.sgx.com/FileOpen/SanTehAn...leID=68384

For the Anting Hotel, the company has decided to lease out to 3rd Party and will be collecting rental income starting from 3Q FY2014. See the following for more details.

"After a thorough review of the Group’s business strategy, the Group decided to lease out the converted office building to third party hotel operator, instead of running the hotel operation itself. Hence, a lease agreement has been signed by the Group to lease out nine and a half storeys, measuring a total floor area of 10,121 square meters of the converted office building, with a third party hotel operator. The lease period is 12 years with an option to renew for another 6 years. The remaining floor area of the 15-storey building will be used by the Group and/or leased out as office units."

http://infopub.sgx.com/Apps?A=COW_CorpAn...ESULTS.pdf

As for the Fujian Anxi project, the following is the detail for your reference and the company will by collecting for the Fujian County government 6X installment payments 1/2 yearly once it is completed. As for how much is each payment, frankly I am not sure

"Anxi is a county located in the Fujian province. To undertake the project, the Group has incorporated a 75% owned subsidiary known as San Teh Xing Real Estate (Fujian) Co., Ltd (“ST Fujian”) in the People’s Republic of China with a registered and paid up capital of RMB60.0 million. Under the BT arrangement, ST Fujian is contracted to carry out a mass residential property project with an estimated built-in area of approximately 77,000 sqm on a piece of land it acquired for a local government affiliated company (the “Contracting Party). Upon completion of the construction, which is expected to be two years, the ownership of the project will be transferred to the Contracting Party. Payment by the Contracting Party would be in six half-yearly, equal installments, commencing after the completion of construction. The payment is secured by an undertaking from the Treasury Bureau of the local government. The total project cost is estimated to be RMB120.0 million (approximately S$24.0 million)."

The following is the latest numbers for your reference.

SanTeh Limited
Total Current Asset ('000) $73,434.00
Total Number of shares('000) 342,024.76
Net Current Asset Per Share $0.1247
Margin Of Safety $0.0831
Mkt Price $0.300
NAV $0.6084
NTA $0.6084
Price/BV 0.493
Price/NTA 0.4931
(Net Debt)/Cash $40,854.00
Net Gearing 19.63%
Net Debt/Cash per share $0.11945


1HFY2014 ('000)
Revenue $22,369.00
Profit ($4,185.00)
Net Margin -18.71%
EPS ($0.0100)
DPS $0.000
Dividend yield 0.00%
PE -29.87
ROE -2.01%
Operating Cash Flow $6,068.00
CAPEX $17,406.00
Free Cash Flow ($11,338.00)

1HFY2014
The property projects at Shanghai Anting, Fujian Anxi and Dali Heqing are progressing in accordance to our planned completion schedule. The commercial launch of the 4-storey shopping mall at Shanghai Anting is targeted in the fourth quarter of 2014. The Group will start to recognize rental income in the third quarter of 2014.
The build-and-transfer residential project at Anxi is on schedule for completion in the third quarter of 2014. Upon completion, the ownership of the project will be transferred to a local government affiliated company and we will thereafter begin to receive payment for the project in six half-yearly instalments.
The Group expects its PVC pipes and fittings and hotel operations to continue to face challenging business environment.

[ahlientok]

Currently, San Teh has 2 segments, namely Hotel and Property, PVC Pipes and Fitting. It own and operate 2 hotels (4 and 5 stars), 1 in Nantong in Jiansu (255 rooms) and the other resort hotel in Suzhou (Tai Hu) 191 rooms, however both of these hotels are not making $$. As for the PVC pipes business, it is marginally break even or suffer a slight loss for the past 2 years.

My interest in this company is not the hotel and PVC business but the properties under development which is almost completed in 4QFY2014 Shanghai Anting as well as their BT (build-and-transfer) mass market properties in Fujina Anxi (3QFY2014, yes this coming quarter).

My vested interest in this company is because of the following reasons:

1. The completion of developments projects (Anting and Anxi in the next 2 quarters) after of 2 to 3 years of construction as well as the recurring incomes these properties going to generate for the coming quarters. See the following for more details.

2. The financial of San Teh is very strong and currently trading only at 0.5X price to book with net cash of 12 cents as well as short and long term investment securities of 20+ millions which can be liquidated. The dividend yield for the company is not too bad for the last 3 years of 1 to 0.8 cents per share even though the company is not making much profit.

3. In addition, this company has many leased properties in china (Jiang Su, Yunan and shang hai) and all of them are at cost.

As for the Anting project, the following is the detail for your reference.

"The site of the Anting redevelopment project is located approximately 40 km from the city of Shanghai. Under the project, our existing office building and its surrounding land will be redeveloped into a property complex (namely Santeh Commercial Plaza), which will consist of: (i) a business hotel with 168 rooms and equipped with, inter alia, lobby, business centre, café restaurant, and meeting rooms; and (ii) a four-storey shopping mall with a total built-in area of approximately 23,000 sqm and a 10-storey Small Office / Home Office apartment block (where the units can be used for residential-cum-office purposes) consisting of 80 apartment units with a total built-in area of approximately 7,700 sqm. The project is estimated to cost RMB200.0 million (approximately S$40.0 million) and is expected to take two years to complete."

http://infopub.sgx.com/FileOpen/SanTehAn...leID=68384

For the Anting Hotel, the company has decided to lease out to 3rd Party and will be collecting rental income starting from 3Q FY2014. See the following for more details.

"After a thorough review of the Group’s business strategy, the Group decided to lease out the converted office building to third party hotel operator, instead of running the hotel operation itself. Hence, a lease agreement has been signed by the Group to lease out nine and a half storeys, measuring a total floor area of 10,121 square meters of the converted office building, with a third party hotel operator. The lease period is 12 years with an option to renew for another 6 years. The remaining floor area of the 15-storey building will be used by the Group and/or leased out as office units."

http://infopub.sgx.com/Apps?A=COW_CorpAn...ESULTS.pdf

As for the Fujian Anxi project, the following is the detail for your reference and the company will by collecting for the Fujian County government 6X installment payments 1/2 yearly once it is completed. As for how much is each payment, frankly I am not sure

"Anxi is a county located in the Fujian province. To undertake the project, the Group has incorporated a 75% owned subsidiary known as San Teh Xing Real Estate (Fujian) Co., Ltd (“ST Fujian”) in the People’s Republic of China with a registered and paid up capital of RMB60.0 million. Under the BT arrangement, ST Fujian is contracted to carry out a mass residential property project with an estimated built-in area of approximately 77,000 sqm on a piece of land it acquired for a local government affiliated company (the “Contracting Party). Upon completion of the construction, which is expected to be two years, the ownership of the project will be transferred to the Contracting Party. Payment by the Contracting Party would be in six half-yearly, equal installments, commencing after the completion of construction. The payment is secured by an undertaking from the Treasury Bureau of the local government. The total project cost is estimated to be RMB120.0 million (approximately S$24.0 million)."

The following is the latest numbers for your reference.

SanTeh Limited
Total Current Asset ('000) $73,434.00
Total Number of shares('000) 342,024.76
Net Current Asset Per Share $0.1247
Margin Of Safety $0.0831
Mkt Price $0.300
NAV $0.6084
NTA $0.6084
Price/BV 0.493
Price/NTA 0.4931
(Net Debt)/Cash $40,854.00
Net Gearing 19.63%
Net Debt/Cash per share $0.11945


1HFY2014 ('000)
Revenue $22,369.00
Profit ($4,185.00)
Net Margin -18.71%
EPS ($0.0100)
DPS $0.000
Dividend yield 0.00%
PE -29.87
ROE -2.01%
Operating Cash Flow $6,068.00
CAPEX $17,406.00
Free Cash Flow ($11,338.00)

1HFY2014
The property projects at Shanghai Anting, Fujian Anxi and Dali Heqing are progressing in accordance to our planned completion schedule. The commercial launch of the 4-storey shopping mall at Shanghai Anting is targeted in the fourth quarter of 2014. The Group will start to recognize rental income in the third quarter of 2014.
The build-and-transfer residential project at Anxi is on schedule for completion in the third quarter of 2014. Upon completion, the ownership of the project will be transferred to a local government affiliated company and we will thereafter begin to receive payment for the project in six half-yearly instalments.
The Group expects its PVC pipes and fittings and hotel operations to continue to face challenging business environment.

[ahlientok]

Thanks for the information. Wish to know how come you are so well informed ?

[krowten]

This is one of the few stocks I am still holding because they are not so liquid and prices have been beaten down so much.

In the midst of the stock market turmoil, I re-looked at its 2Q15 results and feel more assured that despite of the losses incurred and not so bright prospect in the near future, it is not burning cash and has no debt. Its cash and property values are significantly higher than its market cap and is trading at about 0.4 time the NAV at the last traded price of 25.0 cents.

For its Build and Transfer Anxi project, the contract value of which is about $45m and San Teh will receive the payment over 6 installment over 3 years starting March 2015. San Teh has received the first instalment of $9.3m in March 2015 and the next instalment will be received in September 2015. The payment for its Anxi project will bring in $15m cash flow each year. I expect San The to be able to continue to pay 0.8 cents of dividend, which will translate to a yield of 3.2%.

Look to be ok for me to continue to hold San Teh. Hope others could share their views on San Teh.


•Kao Ching Fong nee Pan ceased buying since 2 June 2015.
•San Teh released 2Q15 results on 13 August 2015.
•Revenue dropped 54.9% y-o-y for 2Q and dropped 42.9% y-o-y for 1H. This is mainly due to lower revenue recorded in the hotel and property operation.
•Gross profit dropped 67.2% y-o-y for 2Q and increased 2.4% y-o-y for 1H
•Loss before tax is $2,352K for 2Q15 and $914K for 1H15
•Loss attributable to owners is $2,604K for 2Q15 and $1,454K for 1H15
•Total comprehensive loss attributable to owners is $5,570K for 2Q15 and a gain of $277K for 1H15
•Cash is $37,143K as compared to $40,014K on 31 Dec 2014. It has no debt. It also holds investment securities that are worth $8,318K.
•Equity is $216,600K as compared to $219,059K on 31 Dec 2014.
•Net cash from operating activities is $4,340K for 2Q15 and -$335K for 1H15.
•PPE expense is -$91K for 1H15 and -$340K for 1H15.
•Loss per share is 0.76 cents and net asset value is 63 cents.
•Hotel and property operation reported a decrease in revenue of $7.3 million from $8.7 million in 2Q14 to $1.4 million in 2Q15 due to lower contribution from the build-and-transfer (“BT”) project at Anxi as the project is now at completion stage. Loss of the operation increased by $0.8 million to $1.4 million in 2Q15 mainly because of the higher operating loss reported by the Shanghai Anting project.
•Revenue of the PVC pipes and fittings operation decreased from $4.8 million in 2Q14 to $4.7 million in 2Q15 owing to lower sales quantity of the Nantong plant. Operating profit increased from $0.2 million in 2Q14 to $0.3 million in 2Q15 because of the lower loss incurred by the Midu plant, which was closed down in the second quarter of 2014.
•The Group reported an exchange loss of $0.9 million in 2Q15 mainly due to the weakening of the US dollar and Renminbi against the Singapore dollar. The currency translation loss of $2.8 million reported in other comprehensive income is attributable to the strengthening of the Singapore dollar against the Renminbi.
•The construction of the Dali Heqing project is still put on hold as the legal proceeding is on-going.
•The Group expects its PVC pipes and fittings operation and Suzhou hotel to continue to face challenging business environment.
•Anxi project: 4Q14 report -Total contract value for the Anxi project is approximately $45.0 million and San Teh will be received in six instalments over the next 3 years, with the first one falling due in March 2015. 1Q15 report: The Group has received the first instalment amounted to $9.3 million for the BT project at Anxi in March 2015. Next the next instalment of about $7m should be received in September 2015, which will boast its cash flow.
•At the last traded price of 25.0 cents, San Teh is trading at 39.7% of its NAV, which is represented substantially in cash, investment securities and property.

[cyclone]

Profit guidance. Dividend will be reduced again or skipped this time ?

San Teh Ltd would like to inform that following a preliminary assessment of the Group's unaudited consolidated financial results, the Group expects to report a loss for the financial year ended 31 December 2015 mainly due to impairment loss on financial assets.
Further details of the Group's results will be made available when the Company announces its unaudited consolidated financial results for the financial year ended 31 December 2015 on 26 February 2016.