Sino Grandness

[specuvestor]

At least the status of the bonds are clear now: They are restructured and creditors effectively agreed to a partial redemption first. I am assuming it had been agreed after the auditors finalised their accounts as the auditors had assumed 31 Dec 2016 maturity for the whole lot.  

That means SinoG will have quite a substantial extraordinary profit for 1Q16 on accounting reversals for the 40% CB converted to straight bonds. I think there is also a bit of confusion on this restructuring: 60% of the CB remains as it is with maturity extended to ~ Dec 2016 and i/r of 20% and 25% but 40% is restructured into straight bonds of maturity 31 May and ~ Dec 2016

Based on the article the company has RMB143m cash on hand and paying RMB106.9m for the SB1 bondholders on May31. Reasonable guess is that the IPO won't happen before 31 May as exchange filing is probably not in time to lodge and I presume we yet to know who are the sponsor and auditor.

What is also interesting is that it revealed for the 1st time officially the main holders of the bonds as CDIB, GS and Hon Chuan. Hon Chuan interest is actually quite small at around $1m for 40%.

I think it is likely that we wil have to ask about the IPO again in AGM. Cashflow wise it is very disconcerting.

Just a few points on the results to start the ball rolling:

1) As expected back in March the writebacks on CB will be substantial in 1Q which will not reoccur in next quarters (except the CB optionality decay). Amount is found in RMB91,618 "Gain on Restructuring of Convertible Bonds" and RMB157,888 "Changes in fair value of the option derivatives" which is the same as the net reduction in "Straight Bonds" and "Convertible Bonds"

2) Simple way to look through the PnL is to see the cashflow. With a jump in revenue by 24%, operational cashflow excluding WC changes is up 10%

3) Holdco profit for 1Q approximately went up around RMB50m that reduced accumulated loss to RMB81,002, while cash goes down to RMB1.8m, so they need cash in 2Q from TTA or payment from subsi to fund their RMB10m dividend payment. I'm still perplexed how they can pay dividend with accumulated loss.

[alex]

anyway, it doesnt matter. Some "senior guys" here also post zero sense comments.

[cyclone]

anyway, it doesnt matter. Some "senior guys" here also post zero sense comments.

If you have find any zero sense postings, just point them out. So that forumers can learn from your insight.

I think your comment above does not add any value to the discussion.

[portuser]

Specuvestor wrote:

"................. I'm still perplexed how they can pay dividend with accumulated loss."



Accumulated loss is not a hindrance to dividend payment. In 2009, New Toyo International Holdings Limited declared a 1.27c final dividend, amounting to $3.5m, when its accumulated loss was $21.6m.

[BlueKelah]

Specuvestor wrote:

"................. I'm still perplexed how they can pay dividend with accumulated loss."



Accumulated loss is not a hindrance to dividend payment. In 2009, New Toyo International Holdings Limited declared a 1.27c final dividend, amounting to $3.5m, when its accumulated loss was $21.6m.

Yeah thats about the time the stock traded at its lowest and also about when the financials at NT went haywire for a while before management got a wake up call and started to get into shape. Since then investors have lost faith in NT and that's why the price is still much undervalued now despite the vastly improved finances.

so yeah SG can pay whatever dividend they want, losses or no losses, but damage done to finances is another thing.

Question is who benefits most from this dividend payout?

[kbl]

Good afternoon Portuser san and everyone.

but there was a rights 3 FOR 5 @ SGD 0.12 2 months later.

Accumulated loss was $21.6m? Can you please post the link? Thank you.


nv both.

[kbl]

Good afternoon Portuser san and everyone.

but there was a rights 3 FOR 5 @ SGD 0.12 2 months later.

Accumulated loss was $21.6m? Can you please post the link? Thank you.


nv both.

Found the link.

http://infopub.sgx.com/FileOpen/NTIH_AR0...ileID=8286

[portuser]

BlueKelah wrote:

"Yeah thats about the time the stock traded at its lowest and also about when the financials at NT went haywire for a while before management got a wake up call and started to get into shape. Since then investors have lost faith in NT and that's why the price is still much undervalued now despite the vastly improved finances.

so yeah SG can pay whatever dividend they want, losses or no losses, but damage done to finances is another thing."



New Toyo International Holdings (NTIH) still carried an accumulated loss of $12.9m as at end-2015. 

How did NTIH pay dividends all these years then?

NTIH's subsidiaries turned in profits of $20.6m last year and paid NTIH $9.7m as dividends, which was reported as NTIH's profit. From the profit, NTIH paid $5.3m as dividend to its shareholders.

Dividend payment by Sino Grandness Food Industry Group Limited (SGFI) to its shareholders follows the same process. 

In a nutshell, dividends paid to shareholders by the holding company come from profits of its subsidiaries. 

[piaopiao]

Specuvestor wrote:

"................. I'm still perplexed how they can pay dividend with accumulated loss."



Accumulated loss is not a hindrance to dividend payment. In 2009, New Toyo International Holdings Limited declared a 1.27c final dividend, amounting to $3.5m, when its accumulated loss was $21.6m.

[crubs]

It is true that a company cannot pay dividends out of an accumulated loss. However the question is whether this accumulated loss is determined on a company level or a group level.

Specuvestor,
I assume that you understand it to be on a company level since only Sino Grandness holding company has an accumulated loss while the group is profitable. Why do you think it should be considered on a company level ?