Centurion Corporation

[ghchua]

Centurion's customers are not very happy that accommodation costs have increased, with Nordic Group as an example, believing that the cost increases will work itself out in due time. Nonetheless, "hope" is not a good thing to depend on though.

Hi weijian,

I beg to differ with Nordic Group's view. Costs is a function of revenue. As your revenue increases, you should expect higher costs. Increasing productivity and automation should be factors that needs to be considered before doing acquisitions to increase revenue, and not after.

Frankly speaking, their issues is mainly due to their many acquisitions done during a short period of time. All these businesses need time to integrate their processes and systems back into the group to be cost efficient. Initial bump in revenue and profit had gone, now it is back to the price to be paid for doing fast revenue bump up through acquisitions.

[Behappyalways]

Yes...another big one coming out in Dec 2024 by........Centurion

https://links.sgx.com/1.0.0/corporate-an...61583afe46

99% (365 days in a year) occupancy meant one who signed up for one year and decides to vacate after the duration will see his bed slot quickly filled by another one within 4 days.

Policy is also helping with the demand...employer can get approval faster and also as an employer you do not need to worry about the 'hanky panky' if you place your workers in dorm...

https://m.youtube.com/watch?v=UwmLTdDIMYk

We are hoping that there will be more dormitories built in the course of the next 12-18 months, which should decrease dormitory costs.

Nordic Grp AGM MoM
https://links.sgx.com/FileOpen/NGL%20-%2...eID=805134

[Behappyalways]

Boss bought 20m shares...
https://links.sgx.com/1.0.0/corporate-an...90fd6bd372

[Behappyalways]

Positive Profit Guidance
https://links.sgx.com/1.0.0/corporate-an...854afba932

[Behappyalways]

1st half result is out

https://links.sgx.com/1.0.0/corporate-an...04bcfbd04c


Earnings per share of 14.06 cents Vs 4.56 cents a year ago. Without the valuation gain, core earnings was 5.77 cents Vs 3.93 cents a year ago. Nta of $1.12.

Interim dividend of 1.5 cents Vs 1 cents a year ago.

[Behappyalways]

Page 17.... Demand is underserved by supply of purpose-built, professionally managed dormitory beds


Page 20... Positive rental rate revisions continue, at a moderated pace.

https://links.sgx.com/1.0.0/corporate-an...6cd4f51ec7

[Behappyalways]

Its average rental rate per bed is $450-500/bed
Vs some rates at $600/bed, this implying some scope for positive rental reversions in the next 12-18 months

https://sginvestors.io/analysts/research...2024-08-20

[Yoyo]

Its average rental rate per bed is $450-500/bed
Vs some rates at $600/bed, this implying some scope for positive rental reversions in the next 12-18 months

https://sginvestors.io/analysts/research...2024-08-20

Some rates at $600/bed??
I did a search which reveals some dormitory units are indeed asking for as much as $650.  
https://www.99.co/singapore/commercial/rent/dormitory

[Behappyalways]

This company has good potential....the management has good foresight and plans ahead....look like they can continue to grow their earnings....

https://links.sgx.com/1.0.0/corporate-an...8e3d0c7988

[weijian]

PBWA in Spore is currently having its renaissance, on top of 2 huge tail winds - (1) booming Spore construction that has firmly recovered since its last downturn in the mid 2010s and, (2) post covid-19 regulatory requirements by MoM.

Most construction related firms are enjoying the 1st tailwind and have their YTD TSR between 40-50%, easily matching to the S&P500 Mag7. Centurion has both tailwinds and maybe that explains why its YTD TSR is closer to Nvidia than Mag7.  I suppose this is one of the few times, in the absence of some catalyst like takeovers, that a STI stock can boost about.

That said, every yin has its yang. PBWA is a cost center and not really a revenue driver. HOME will probably disagree but that's the reality of things. Interesting to observe that Centurion's customers (or potential customers) are taking matters into their own hands, as per ISOTeam's SIAS AGM Q&A (in italics):

The cost of housing workers at dormitories has also risen due to post-pandemic regulations implemented by the Ministry of Manpower (MOM) to reduce density and improve the living conditions of workers. To manage these issues, we have built a dormitory on two floors of our headquarters, which currently houses approximately 160 of our workers, translating into significant cost savings.

From Google maps, ISO team HQ is only 4 storey high and they took out (chased out some tenants and retrofitted them?) 2 storeys to house 160 workers. Based on bed rates published by VBs and taking out the meals/utilities cost, that's probably ~750k saved per annum which flows directly to the bottomline. And with ISOTeam's P/E~6, that is a cool "4million" of market cap OR close to a million bucks of "paper wealth" for the EDs (based on their 20% stake). Now it makes a lot of sense why they are willing to share their HQ with close to 160 FTs!