Kingsmen Creatives

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Interesting.

So Messrs Soh and Ong were the beneficiaries of the 2007 Office sale (and presumeably rental payments by KCL prior to February 2007?), NOT the shareholders of Kingsmen Creatives?

I see that Kingsmen International had (has?) other interests in which Kingsmen companies had/has an interest, i.e. not only the Singapore Office HQ prior to February 2007. And that other than Messrs Soh and Ong there are no shareholders of Kingsmen International. I wonder what charges Kingsmen Creatives are passing onto (have passed on) Kingsman International for the services and expertise it provides?

Vested
(04-03-2013, 01:57 PM)KopiKat Wrote: I was also wondering earlier and suspected that Kingsmen International is not a Related Party (to Kingsmen Creatives - the listed entity) as I couldn't find any mention of the former in the list of Subsidiaries or Associates in AR2007. Neither was there any financial item on Gain / Loss of Disposal (to Mapletree Log) for the said HQ asset.

I finally found a mention of Kingsmen International in AR2006 <pg 91>,


3. CATEGORIES OF INTERESTED PERSONS

The Controlling Shareholders and executive Directors, Mr Benedict Soh and Mr Simon Ong, are directors and shareholders of the entired issued and paid-up share capital of Kingsmen International Pte Ltd (“Kingsmen International”), each holding 50.0% of its equity interest. Ms Vera Ong Lim Guek Noi, the wife of Mr Simon Ong, and Ms Png Geok Choo Rose, the wife of Mr Benedict Soh, are also directors of Kingsmen International.

Kingsmen International is an investment holding company incorporated in Singapore with an issued and paid-up share capital of $3,600,000, and has equity interest in several Kingsmen Affiliates set out below. Accordingly, Kingsmen Affiliates are interested persons under Chapter 9 of the Listing Manual.
RBM, Retired Botanic MatSalleh
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From Kingsmen IPO Prospectus

http://info.sgx.com/webipo.nsf/96feb765c...d0026acaa/$FILE/Kingsmen%20IPO.pdf

Quote:Lease of the Kingsmen Creative Centre
Our Company leases Levels 1, 2, 3, 5 and 6 of the Office Block and Levels 1 to 3 of the
Workshop Block of Kingsmen Creative Centre together with all the equipment, fixtures,
fittings, furniture and systems (including security and telephone systems) found on the
premises, from Kingsmen International for use as our design and production cum logistics
centre. The premises cover an area of approximately 60,841 sq ft (please see the
“Kingsmen Creative Centre” section on pages 66 to 68 of this Prospectus for more details).
The lease agreement also provides that we are entitled to free access to additional space of
approximately 42,000 sq ft comprising ancillary facilities. The current lease is for a term of
two years which commenced from 1 January 2003 at a monthly rental of $88,031.70 for the
premises and $14,719.56 for fixtures, fittings, furniture and equipment. The rental was
determined according to the prevailing market rental rates for similar properties and
transacted at an arm’s length basis and on normal commercial terms. Our Audit Committee
has reviewed the terms of the current lease and is of the opinion that such terms have been
arrived at on arms’ length basis. After our admission to the Official List of the SGX Sesdaq,
any renewal of the lease for the above premises will be entered in accordance with such
guidelines as described under the “Guidelines and Review Procedures for Future Interested
Person Transactions” section set out on pages 127 to 130 of this Prospectus and Chapter 9
of the Listing Manual, so as to ensure that the amount of rent payable by our Company to
Kingsmen International will be comparable to the prevailing market rates after making
relevant enquiries with other landlords of similar properties and obtaining necessary reports
or reviews published by property agents (including an independent valuation report by a
property valuer, where considered appropriate).
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The Straits Times
www.straitstimes.com
Published on Mar 04, 2013
TWO'S COMPANY
Long live the Kings

Kingsmen Creatives, a start-up in 1976 is now a design and production powerhouse

By Lee Siew Hua

Mr Benedict Soh, 63, and Mr Simon Ong, 59, were youthful long-haired buddies when they rented a dowdy Balestier terrace house in 1976 - and began building a sleek design and production empire across Asia.

Their listed Kingsmen Creatives has put the sparkle and done the spadework for several Singapore firsts. It built the castle at Universal Studios, Formula One corporate suites, and Cloud Forest in Gardens By The Bay.

Earlier works included the street light-ups in the 1980s, and regional air shows in the 1990s.

The two men were colleagues for a year-plus in Publicity and Display Associates, among the top three designers of displays in their time but now defunct.

In 1975, Mr Soh, then an account service director and right-hand man of the boss, was incensed that his employment terms were changed. He invited Mr Ong, whom he considered the best designer among 10 in the house, to set up shop with him.

However, Mr Ong felt he was too young at 22 to sail into the unknown. Mr Soh asked him again a year later. This time, the younger man consulted his father, who gave his blessings and $6,000 in seed money to match Mr Soh's cash.

On April 1, 1976, Kingsmen Creatives began life as a seven-man start-up under two equal partners.

By day Mr Soh, then 26, scouted for business. They strategised in the evening, with Mr Ong driving design.

Recalls Mr Ong, then almost 24, and now the Kingsmen group managing director: "If there were eight days a week, we would have worked eight days."

Their first gig was to set up the Canon showroom in Raffles Place. Mr Soh, now executive chairman, says: "We had big projects from Day One."

The young turks, garbed in bell bottoms, too-tight shirts and platform shoes, had desks side by side in spartan premises. Only the workshop was air-conditioned to muffle noise as they were in a residential zone and borderline legal.

Their girlfriends, now wives, managed paperwork in their spare time.

From those heady days, they have expanded their three-dimensional marketing communications firm to fit interiors for mega brands, from the hip Abercrombie & Fitch to the luxury Fendi boutique at Marina Bay Sands.

The group also works on exhibitions such as Art Stage Singapore, museums such as the interactive gallery at Marina Barrage, and alternative marketing that has involved flash mobs.

Beyond Singapore, it has created decorations for the Macau handover ceremony in 1999 and built pavilions for World Expo Shanghai 2010. The group has 18 offices in Asia and the Middle East.

The partners think they are unique in the world with their expanse of services.

So it has been a scintillating journey for Kingsmen, which made $850,000 in the first nine months of operations. Last year, combined group turnover was $423 million.

The group has stayed in the black, weathering recessions and other vicissitudes. The latest, in January, involved alleged financial irregularities by two employees at its Kingsmen Exhibits subsidiary.

Mr Soh says an international accounting firm will review the group's internal controls. It will develop a "comprehensive group risk assurance framework" to fortify internal controls and risk management, he says.

In making it to the big time, they did not need to always agree.

"We look at the big picture," Mr Ong maintains. "The important thing is that we can sit down and challenge each other. If I have a good idea about doing new business, and he thinks otherwise, the second move is to try to convince him again, then abandon the idea if it doesn't work."

Says Mr Soh: "We are objective. We are very cool and we listen."

Once they agree to pursue an idea, he adds, there is no blame game even if the new venture does not work out. "If it makes money, I get a share too," he reasons.

Even if their distinct strengths in design and marketing meld so ideally, Mr Ong says: "I don't think we complement 100 per cent. If we always have the same strength and are agreeing all the time, one of us is redundant."

Concurring, Mr Soh points out: "We try not to overlap each other, we don't want to do double work. In our case, one plus one becomes three."

siewhua@sph.com.sg

----------------

The Straits Times
www.straitstimes.com
Published on Mar 04, 2013
BENEDICT ON SIMON
The disciplined designer


Mr Benedict Soh (above) and Mr Simon Ong both founded Kingsmen Creatives in 1976.

Mr Simon Ong, 59, is a star designer with strong discipline.

That is how the man who designed the first Christmas light-up in 1984 and other visual fiestas appears to Mr Benedict Soh, his co-founder of 36 years at Kingsmen Creatives.

Mr Soh, 63, highlights his friend's creativity and clout - amply seen too in their "wall-less" office designed by Mr Ong.

Instead of the duo sitting in two ostentatious suites atop their communications design empire that stretches from Asia to the Middle East, a simple shared space of 400 sq ft was created in their Upper Changi complex.

This way, the two bosses confer as they work, sometimes without glancing up from computer screens in their own corner. If they want privacy, sliding doors roll into place.

The singular design saves time and space. They share a compact conference table lodged between their work stations.

"Simon is the original greenie," quips Mr Soh, executive chairman and business brains of Kingsmen. Mr Ong, group managing director, says their office concept reflects their partnership: "Decision-making is very fast. There is nothing to hide."

One speedy choice was made when Mr Ong proposed Humpty Dumpty as their playful corporate mascot in the 1980s.

In the beloved nursery rhyme, Humpty Dumpty had a great fall and "all the King's men" could not put him together again. (The company was named Kingmen as customers are treated like kings.)

Then Mr Ong thought of a contrarian slogan: "Who says Humpty Dumpty can't be put together again?"

Mr Soh says: "Within two minutes I said: 'Let's use it.'"

Since 2008, Kingsmenhas been awarded several contracts from Universal Studios worth about $130 million to build the Far Far Away Castle and a Madagascar ship replica on Sentosa. It has also contracted dancers, among diverse projects.

As always, Mr Ong is the creative thinker while Mr Soh plays business guru in their Universal Studios foray. They regard this venture as a quantum leap that has positioned Kingsmen to capture the burgeoning theme-park market in Asia.

Kingsmen, which has 1,400 full-time staff in 18 offices, including Shenzhen, Seoul and Dubai, has won contracts for Hong Kong Disneyland, and is in the running for a piece of the action at Shanghai Disney Resort.

Mr Soh recognised his partner's strengths back in 1974, when they were colleagues in a now-shuttered design display firm. "It was obvious that Simon was better than the chief designer," Mr Soh says of his friend, who is married to Mrs Vera Ong, 54, owner of the Art-2 gallery at the Old Hill Street Police Station.

Their two daughters are a social media entrepreneur aged 34, and an architect who is 28.

Even as the two bosses work closely, they independently run their own slew of projects. Both fondly recall Mr Ong's baby, the first Chrismas light-up, which spun off light-ups for Chinese New Year, Hari Raya and Deepavali.

Mr Ong remembers being "half-happy and half-scared" when they beat out Parisienne and Hong Kong bidders for the light-up contract. The challenge was huge, for Singapore tourism officials admired the Regent Street decorations in London and desired similar buzz in Singapore.

"That was the kind of pressure we faced," says Mr Ong, who has a Master of Design from the University of New South Wales. But he gained immense experience. He would chair meetings with about 20 players, from Orchard Road retailers to Tanglin Police Station to bus companies.

"We made sure the lights were higher than a double-decker bus," he says. Trees were trimmed and lights were strung between 11.30pm and 6am the next day. They watched out for tipsy drivers in fast cars.

His most exciting moment was when the lights were switched on. "It was so spectacular," he says.

Mr Soh smiles and says: "I only remember Simon working at night while I went home to sleep.

"He is very disciplined. He ensured that the job was done well and on time. He wouldn't have been bothered that I wasn't at Orchard Road. No point going down and giving moral support. What for? It's better that one person is holding the fort."

Says Mr Ong: "This is our culture. Managers can work independently and as a team."
----------------

The Straits Times
www.straitstimes.com
Published on Mar 04, 2013
SIMON ON BENEDICT
The gifted communicator


Mr Benedict Soh and Mr Simon Ong (above) both founded Kingsmen Creatives in 1976. -- PHOTO: KINGSMEN CREATIVES

Businessman Benedict Soh's forte is organisation, and he has a wonderful command of English too.

His partner in the Kingsmen Creatives group, Mr Simon Ong, 59, thinks these are standout strengths in Mr Soh, 63, executive chairman at the design and production powerhouse.

Says Mr Ong, Kingsmen's group managing director: "Besides his organisational skills, Ben has a very unique strength - that is his English language. When you put together words and visuals to communicate, it's very powerful."

Language is valuable in framing the company's ideology of being a "design-led, quality and service-driven" player in a world where contractors often think of the fastest, cheapest way, then move on after collecting payment, they point out.

Instead, Kingsmen, which counts 300 designers among its 1,400 staff, says it respects design and aims to deliver top after-sales service.

"We are selling a promise that we will build you a castle," says Mr Soh. "My word is my bond."

With words wed to convictions, such thinking is instilled in the diverse staff spread over 18 offices in Asia and the Middle East. The Singapore headquarters houses 400 employees, from carpenters blasting Mandarin pop to designers in a lofty studio.

The company has long gone global. One breakthrough was in 1992 when Kingsmen designed, built and managed the Singapore Pavilion at the World Expo in Seville.

Mr Ong piloted the design, then Mr Soh took over project management for the next intense 11/2 years.

Mr Ong remembers: "Ben had many problems but he tried to contain them." As he sees it, they are both hard-wired to "go for it and never say die".

Mr Soh had to contend with long flights and complex logistics, a limited budget and illogical local adminstrators.

Metal roof trusses were trucked in from the United Kingdom while the Spaniards did foundation work, for instance. Teams dealing with air-conditioning, electricity and interiors came from Singapore.

"Days before the show, the telecommucations was cut off, so we rented a mobile phone," Mr Soh recounts.

Then lights were cut off, so they rented a generator. "We had to feed it with fuel, and suddenly your fuel truck can't come in. So you take your car to carry in jerry cans."

On and on it went, with last-minute delays of approvals and much scooting about. "Despite the odds, we got the pavilion open in time," marvels Mr Soh, who is married to housewife Rose, 59.

Their eldest daughter is a lawyer aged 33. Their son is 28 and a doctor, while their younger daughter is 23 and a recent law graduate. Mr Soh is also a grandfather of two.

Seville's challenges were severe, but the duo know that projects come with problems. "The difference is that experienced contractors overcome problems. We become even more experienced, we minimise these things," says Mr Ong.

To finesse their game in a greatly dynamic trade, they both pursued MBAs in their 40s, sometimes doing homework in planes and airport lounges over 25 months.

Mr Soh's degree was issued by the University of Hull, while Mr Ong earned his from the University of South Australia. They also prod and pay directors to do MBAs.

With or without extra education, they have been winners. Mr Ong has led his teams to garner multiple awards, from President's Design Awards here to prizes for store design from the United States.

Mr Soh's most recent accolade was last October's Lifetime Achievement for Outstanding Contribution to Tourism, conferred by the Singapore Tourism Board.

When Life! sought an interview soon after that achievement, he declined to be profiled solo. The Kingsmen story has to be narrated in two voices, he indicated.

Looking back at their intertwined careers, he says: "I have never for a moment thought I would have made all the money on my own."

The company has stayed in the black, despite competition or crises such as the 2003 Sars outbreak.

They each have a stake of about 24 per cent in Kingsmen, listed in 2003, and have not sold a single share. Mr Soh says: "When Simon and I started, we knew we didn't have to be the biggest. We wanted to be the best."
My Value Investing Blog: http://sgmusicwhiz.blogspot.com/
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It is extremely hard to find life-long friend cum career partner.

To both, Mr Soh and Mr Ong, on top of their great success in KC, another greater success is a life-long friendship and partnership with respect and admiration.
“夏则资皮,冬则资纱,旱则资船,水则资车” - 范蠡
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The AmFraser report explains the lower margins for M&E division, and also the seemingly higher orderbook reported in Feb 2012 compared to Feb 2013 (high base effect). Informative but I think they are too aggressive on the EPS growth rate. Even with a 10% growth in EPS we should just see an EPS of 9.83c/share for FY 2013.


Attached Files
.pdf   March 5, 2013 - Kingsmen Creatives (AmFraser).pdf (Size: 229.23 KB / Downloads: 28)
My Value Investing Blog: http://sgmusicwhiz.blogspot.com/
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(05-03-2013, 05:02 PM)Musicwhiz Wrote: The AmFraser report explains the lower margins for M&E division, and also the seemingly higher orderbook reported in Feb 2012 compared to Feb 2013 (high base effect). Informative but I think they are too aggressive on the EPS growth rate. Even with a 10% growth in EPS we should just see an EPS of 9.83c/share for FY 2013.

Thanks Musicwhiz for the info.
It basically answers our questions.
That's quite a mere chance.
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Thank you for sharing the AmFraser report MW,

I understand there was a Kingsmen Management call with members of the "Analyst Community" yesterday and I know that the question regarding eroded E&M division margins was raised ............. I would not be at all surprised if this thread is being monitored by at least one of the analysts following the stock.

(05-03-2013, 05:14 PM)valuestalker Wrote:
(05-03-2013, 05:02 PM)Musicwhiz Wrote: The AmFraser report explains the lower margins for M&E division, and also the seemingly higher orderbook reported in Feb 2012 compared to Feb 2013 (high base effect). Informative but I think they are too aggressive on the EPS growth rate. Even with a 10% growth in EPS we should just see an EPS of 9.83c/share for FY 2013.

Thanks Musicwhiz for the info.
It basically answers our questions.
That's quite a mere chance.
I attach below a piece from Lynette Tan, analyst at OSK-DMG. She places emphasis on Kingsmen's cash hoard. But otherwise not sure it adds a lot to the postings recently made on this VB thread ................

QUOTE
Kingsmen Creatives: A record quarter; Good times likely to continue (BUY, S$0.79, TP: S$0.93)
Lynette Tan(+65 6232 3895, lynette.tan@sg.oskgroup.com)


4Q12 PATMI grew 6.2% YoY to SGD6.4m, as revenue jumped 25.3% to SGD102.1m. The results were in line with expectations.
Besides the record quarterly performance, Kingsmen also achieved a record high in its cash balance (SGD53.1m). Kingsmen expects FY13 to be another good year, backed by the strong demand for its services and Asia’s growth as an events and theme parks destination. Management declared dividend of SGD4.0¢ / share, which translates into a yield of 5.1%. Its pipeline of projects in the theme parks arena would keep it busy over the next few years. Kingsmen trades at 8.4x FY13F P/E, or 5.4x ex-cash. As we roll forward our earnings, we have a revised TP of SGD0.93, based on 7x FY13F earnings (ex-cash). Maintain BUY.

Huge cash hoard. Kingsmen maintains its strong balance sheet, with a net cash position of SGD48.4m (or SGD0.25 / share). This healthy position, coupled with its operations continuing to generate strong cash flows, would place Kingsmen in a comfortable position to take on more projects. At the same time, Kingsmen is also looking to build its own office building in Singapore, when its current lease expires in 2016. This cash hoard could come in handy for this
purpose.

Outlook continues to be positive, backed by economic growth in Asia and its importance on the world stage. More events and meetings are being set up in Asia. More theme parks are also slated to be open in the region over the next few years, targeting Asia’s rapidly growing middle class. Kingsmen is in a good position to benefit from these trends, having done works for a number of regional events and theme parks. As consumerism in Asia is still relatively healthy, new malls are emerging, existing ones will continue to undergo refurbishment and new international brands will try to penetrate the region. This would benefit Kingsmen’s Interiors business. Its order book currently stands at SGD81m, which is expected to be recognized in FY13.

Maintain BUY, TP raised to SGD0.93. We are estimating earnings of SGD18.0m for FY13. Based on 7x P/E (ex-cash), we have a TP of SGD0.93, a 17.7% upside from current levels. Kingsmen will be conducting a briefing on 4 March. We will issue a further update, if necessary.
UNQUOTE

Vested
RBM, Retired Botanic MatSalleh
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Thanks RBM.

Yes I am also aware that yesterday was the analyst briefing for Kingsmen. I believe DMG's Lynette may issue an update based on the briefing as was mentioned in her last report.

So perhaps we can see more questions being answered, like the one on the new building and how much cash is to be allocated for it.

Let us wait and see.
My Value Investing Blog: http://sgmusicwhiz.blogspot.com/
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I look upon yesterday's (4Mar13) ST interview reports on Ben Soh and Simon Ong as independent confirmation on what most long-term shareholders/investors in Kingsmen already know: That we have a superb, committed and driven top management team that has been guiding the growth and in the recent years geographical diversification of this low-capex, high-ROE and high-dividend business.

Indeed Kingsmen had an analyst briefing yesterday, so we can expect update reports coming in the next few days.

It is hearthening to note that on share-price alone, Kingsmen has out-performed the STI by close to 40% in the last 2 years alone.....
http://finance.yahoo.com/echarts?s=5MZ.S...=undefined;
Of course, if we add the great $0.04/share a year in total dividends, Kingsmen has delivered a solid return to its longer-term shareholders.

I am positive that with its solid track record and the on-going engagement with the investors community, Kingsmen will continue to attract new investors, including some 'BIG FISHES' who may be motivated to buy the whole business. Assuming this as a good possibility, it will be ueful and interesting to guess at what price-range would Ben Soh and Simon Ong be willing to make a deal with a serious buyer.
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If the company is still growing well with margin, won't it be too premature to be sold ?

Just my Diary
corylogics.blogspot.com/


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