Kingsmen Creatives

[heifien91]

Kingsmen has hit an all time high of $0.70 today!

(vested)

[RBM]

I believe this corresponds to a single ("other") trade of 6,000 Kingsmen shares at a S$ 0.70 share price. There has been 1,000 shares traded at S$ 0.695 and another 1,000 at S$ 0.690. The other 110,000 (one hundred and ten thousand) shares traded earlier in today's morning SGX session were all done at S$ 0.65 (sixty five Singapore Cents).

So I seriously wonder if we should not read too much into one low volume trade, particularly when the lions share of todays traded Kingsmen volumes have actually be done at a price less than yesterday's closing price? Just my thoughts.

I recall - from one of MusicWhiz's earlier posts on this thread - that Kingsmen's record intra-day high was S$ 0.74 per share, recorded almost three years ago. I believe Kinsmen's all time closing high price was indeed S$ 0.70 per share (again almost three (3) years ago). I note that Ask prices are now being offerred well below this level .............. so it remains to be seen if we will see a closing all time high today.

I still like the resilience of Kingsmen's share price.

Vested

Kingsmen has hit an all time high of $0.70 today!

(vested)

[Some-one]

Oops, I did not even notice it, haha. For an illiquid counter like Kingsmen, we should not read too much into the price for just one day, because it can just gap down next week. This may just be a single trade unless it can stay there for some time, like the 0.64 to 0.65 range.

[Musicwhiz]

Hi RBM,

Haha I won't read too much into these movements, due to low liquidity and also the seeming desperation of the buyer to execute the trade. Friday's close of 70 cents looks unlikely to be matched today (at time of writing, seller is queueing at 69c).

But one consequence is that the buyer does seem to be willing to queue much higher at 67.5c than they did for some time, which is kind of interesting. Note that 67.5c was not really achieved even after XD for the final dividend of 2.5c/share (at CD share price of 69.5c). Technically, even if Kingsmen traded at 67.5c XD it would be akin to 70c CD, which is a 52-week high.

Whether the growth in the business justifies such valuations remains to be seen.....

[RBM]

Fully Agreed MW...............

Meagre traded volume in Kingsmen shares today - only 6 lots done on the SGX - with plenty of sellers willing to part with their Kingsmen shares at S$ 0.69. So I wouldn't read anything into the 3.5% share price decline vs. last Friday's close of S$ 0.70.

Personally speaking, I believe Kingsmen is still a reasonably priced counter at the prices we have seen in the last couple of sessions. Now trading on a sub 8 P/E and a dividend yield not far shy of 6. I'm looking forward to the 1H results.

Vested

Hi RBM,

Haha I won't read too much into these movements, due to low liquidity and also the seeming desperation of the buyer to execute the trade. Friday's close of 70 cents looks unlikely to be matched today (at time of writing, seller is queueing at 69c).

But one consequence is that the buyer does seem to be willing to queue much higher at 67.5c than they did for some time, which is kind of interesting. Note that 67.5c was not really achieved even after XD for the final dividend of 2.5c/share (at CD share price of 69.5c). Technically, even if Kingsmen traded at 67.5c XD it would be akin to 70c CD, which is a 52-week high.

Whether the growth in the business justifies such valuations remains to be seen.....

[dydx]

As the business of this high dividend stock continues to grow by adding more long-term customers and expanding its regional footprint, and assuming it can also maintain a high ROE and increase its profits over time, its intrinsic value should continue to grow steadily. Rationally speaking, Kingsmen's market cap and share price, backed by steady buying by serious and longer-term investors, should also increase over time.

The best, of course, is when the 2 controlling shareholders decide to sell their stakes to a willing buyer or institution who is prepared to pay a good price for the extra value in the business, including the customer goodwill accumulated over the years and the future growth potential.

[Musicwhiz]

As the business of this high dividend stock continues to grow by adding more long-term customers and expanding its regional footprint, and assuming it can also maintain a high ROE and increase its profits over time, its intrinsic value should continue to grow steadily. Rationally speaking, Kingsmen's market cap and share price, backed by steady buying by serious and longer-term investors, should also increase over time.

If this is the case, then I would be very pleased to own a part of the business. As investors, we have to constantly challenge whether the Company can manage to grow above its cost of capital, and periodically we should also play Devil's Advocate and ask some tough questions to ourselves.

Good news for those who are happy to purchase more shares cheaply - this morning there was a considerable selldown on moderate volume, down 3.7% to 65c.

[Musicwhiz]

Kingsmen will be releasing their 1H 2012 results on August 10, 2012 (Friday).

A quick recap: 1Q 2012 revenues up 29.9% to $47m, NPAT $2.1m up 50% yoy. Net cash of $38.1m as at March 31, 2012. 1Q 2012 OCF generated = $11.4m; FCF of $11m. As at Dec 31, 2011, net cash of $28m. 1Q 2011 OCF generated $1.8m; FCF of $1.4m.

Final Dividend paid on May 25, 2012 of 2.5c/share, equivalent to about $4.7m. This should reduce net cash to about $33.4m, all else equal.

As a comparison, 1H 2011 revenues of $93.6m, down -16% yoy. NPAT of $5.9m down 15% yoy. Net cash of $23m as at June 30, 2011. 1H 2011 OCF generated = $4.6m; FCF of $3.1m.

Will be expecting the usual interim dividend of 1.5c/share; or can the Company give me a positive surprise?

[dydx]

Will the planned opening of the new 150,000 sq.ft. main Robinsons store - which has been reported to cost approx. $40.0m to build up - at The Heeren next year (2013).....
http://www.stproperty.sg/articles-proper...en/a/65951
bring good business to Kingsmen?

I believe so, since the Robinsons Group - which also includes Marks & Spencers, John Little, and quite a few specialty stores/brands - is one of Kingsmen's long-standing customers.....
http://www.robinsons.com.sg/

[Musicwhiz]

Will the planned opening of the new 150,000 sq.ft. main Robinsons store - which has been reported to cost approx. $40.0m to build up - at The Heeren next year (2013).....
http://www.stproperty.sg/articles-proper...en/a/65951
bring good business to Kingsmen?

Thanks dydx,

Interesting news indeed, and I feel that since Robinson's is one of Kingsmen's clients, they should get the fit-out contract for the 5 levels + 1 basement. This contract should be quite substantial, and will add to 2013's revenues and earnings.

I also wonder if Kingsmen helps to fit out Marks and Spencer stores? They are expanding rather aggressively and have just refurbished their new outlet at Wheelock Place (taking over the old Borders Bookstore), while the Parkway Parade outlet has also been expanded significantly. I also noted while visiting Marina Square that Marks and Spencer plan to open there in Sep 2012. So if Kingsmen is doing the fit-out for them it would add to this year's revenues/earnings stream.

Thanks.