Asian Pay Television Trust (APTT)

[tanjm]

but the most worry part is the high debt burden. Interest rate risk is just too high and I am not sure if TBC hedges the risk.

In a value oriented forum, I'm not sure why this statement is made when the answer is in both the IPO documents and the qtrly result presentation report.

Thank you for your comment, I would have find it out if I am vested, unfortunately not.j

It doesn't matter if you are vested or not. If u don't know then don't make a comment like u know something. It sounds like a troll even if you intended it or not.

[valuebuddies]

but the most worry part is the high debt burden. Interest rate risk is just too high and I am not sure if TBC hedges the risk.

In a value oriented forum, I'm not sure why this statement is made when the answer is in both the IPO documents and the qtrly result presentation report.

Thank you for your comment, I would have find it out if I am vested, unfortunately not.j

It doesn't matter if you are vested or not. If u don't know then don't make a comment like u know something. It sounds like a troll even if you intended it or not.

Hedging is just to reduce the impact of interest rate risk and not eliminate them, I don't think the 4% interest is cap throughout the tenors. If you do know something, please share, and not criticise.

[valuebuddies]

By the way, as you have mentioned this is a value oriented forum, and thus I would not argue with you again on this issue which do not benefit other members.

[Greenrookie]

I have some questions on the operating numbers of APTT.

Q3 numbers (000)

OCF ->43240
PPE -> 16378
Interest and other fiance cost ->9648

"real" FCF = 17214

Annualized it = 68856

Number of units = 143680

Annual DPU est = 4.79 cents

How did they project 8.5 cents distribution?

Do they expect PPE and/or OCF to significantly decrease/increase? Loan will not be re-payed so fiance costs should more or less remain constant.

Also, if they drawn down loans to settle tax provision and for capex, it should be another 8 million per annual. FCF will be further reduced, 4.79 cents doesn't even look safe.

Did I make any mistakes in my calculation? Of course they can ignore/ push back Finance costs or capex to hit projection, but how long can you push back capex and can you push back fiance cost at all??

[tanjm]

I have some questions on the operating numbers of APTT.

Q3 numbers (000)

OCF ->43240
PPE -> 16378
Interest and other fiance cost ->9648

"real" FCF = 17214

Annualized it = 68856

Number of units = 143680

Annual DPU est = 4.79 cents

How did they project 8.5 cents distribution?

Do they expect PPE and/or OCF to significantly decrease/increase? Loan will not be re-payed so fiance costs should more or less remain constant.

Also, if they drawn down loans to settle tax provision and for capex, it should be another 8 million per annual. FCF will be further reduced, 4.79 cents doesn't even look safe.

Did I make any mistakes in my calculation? Of course they can ignore/ push back Finance costs or capex to hit projection, but how long can you push back capex and can you push back fiance cost at all??

I believe you were looking at the first column in the cashflow report in the qtr results and not the second?

Regarding dividends, I believe the forecast distribution is 7.5% for 2013, and 8.5% for 2014 in the IPO prospectus. At the IPO price of 97 cents, this works out to between 105 to 120 million dollars.

The 2012 operating cashflow (from prospectus) before working capital changes is 190 mio. The 2013 number is 195 mio and the forecast 2014 number is 201 mio. i.e. a per qtr cashflow of circa 50 mio. The 3rd qtr showed 65 mio.

What is significant is the working capital movement of 31 mio. However I note that they forecasted 40 mio of capital expenditure for network upgrades and new set top boxes for their initiative.

From what I gather (the IPO forecast for 2014 has a clearer picture) they expect to:

- get operating cashflow of about 190 mio per annum, which includes income tax but excludes new investment/working capital changes

- pay 42 mio of interest costs.

- pay 40 mio for property plant and equipment

- pay 114 mio in dividends (works out as 7.9 cents per share)

- borrow an additional 17 mio (presumably from their 198 mio revolving facility).

Any numbers from a single qtr can be lumpy and I gather the main lumpiness in 3rd qtr is due to the 31 mio in working capital change, which is unfortunately not footnoted, but it is entirely possible APTT stocked up for their network upgrade in that qtr.

[Nick]

1) Interesting to note APTT's non-executive director purchased 150,000 shares at $0.775 per share.

http://infopub.sgx.com/FileOpen/25112013...eID=265757

2) Maybe the OCF was affected by one-off listing and restructuring expenses ? The guided FY 2014 dividend is 8.25 cents which works out to 118 million. EBITDA has been stable at $200 million. Capex, interest, management fees and tax expense net of debt financing of growth capex will have to be capped at 80 million.

(Not Vested)

[Nick]

APTT unit price seems to have stabilized and is currently trading at 78.0 cents. Perhaps the insider share buy back may have helped.

Slide 17 of the presentation below gives a good summary of the forecast distribution. Seems EBITDA rather than OCF is the measurement. I guess since the business is cash-based, the OCF and EBITDA should match in the long run though working capital and listing cost may impact in the near term ?

http://static.macquarie.com/dafiles/Inte...on.pdf?v=3 [Investor Presentation]

And lastly, the original TBC acquisition slides by MIIF are good sources of info for prospective investors -

http://www.macquarie.com/dafiles/Interne...l-2007.pdf [TBC Business Overview]

http://www.macquarie.com/dafiles/Interne...l-2007.pdf [TBC Acquisition]

(Not Vested)

[cfa]

Most got themselves involved in this counter since day one of IPO are out of the money ?

[Greenrookie]

Hi buddies,

I refer to the disclosure of change in substantial shareholder announcement,

What does "agregation of global position means" ???

I tried googling it but no satisfactory answer, why is there a need to aggregate/ consolidate the global position, and what difference is that compare to plain transfer of shares???

[money]

I'm still waiting for a response from investor relations on the amortization question.

For a business like APTT, the major risks are:
1. Regulatory.
2. Refinancing.
3. Estimating capital expenditure.

For (1), Taiwan is the better place to be compared with other jurisdictions such as China (HPT), or India (Religare). The authorities are more market oriented and predictable.

For (2), APTT have secured a big loan to a consortium of banks till 2020.

For (3), One method is to (as I have simplistically done) compute a yield that would result if they set aside an amount of money each year.

Regarding their broadband business. I have read their major competitor is Chunghwa Telecom (CHT). CHT appears to sell only fairly low speed internet access (judging from their website). So the question whether they can grow their broadband business is really due to customer preference for high speed internet - i'm not sure how to answer that. APTT appears to believe there's opportunity there given their upgrade of their networks completing in 2014.

Hi tanjm, have they replied on the amortization question? Perhaps what they are referring to is amortization of the fees for the loan facility only. I think i have seen similar amortization in many reits (if i didnt remember wrongly), i am not vested in reits for quite a while