Kingsmen Creatives

[CityFarmer]

Well, balancing the good news with some not-so-good news.

Attached are Kingsmen's auditor's report and the emphasis of matter regarding the fraud a few months ago.

Am i read it differently? I saw good news with auditor clearance on financial report, even the auditor's opinion is not qualified in respect of the fraud.

(vested)

[darrenyc]

Hi all

I was researching KC's annual reports. While top line growth has been impressive over the past few years. this hasnt really translated to bottom line and EPS growth. any concerns on this or have I missed something? Otherwise the company does look like it has gd fundamentals.

[Musicwhiz]

Kingsmen has seen their portion of revenue from Indonesia growing yoy; so will this piece of news help to grow it further?

The Straits Times
www.straitstimes.com
Published on Apr 28, 2013
Foreign retailers making foray into Jakarta
Changing lifestyle and rising affluence attract big brands

By Zubaidah Nazeer Indonesia Correspondent In Jakarta

Banking executive Natalia Purba, 36, may fly less frequently to Singapore to do her shopping once coveted foreign brands, including her favourite Uniqlo, open up here over the coming year.

"Singapore is a shopping paradise... but if Jakarta has got the same brands too, I might cut back," said Ms Purba, who says she flies there once a month to shop and meet friends.

Street brands like H&M, mass outlets like Ikea and Galeries Lafayette and speciality stores like Zara Home, TWG and Rolex are setting up operations, some as early as this year, leading a new wave of foreign retailers aggressively entering the Indonesian market.

Certainly, exciting times at home lie ahead for Indonesian consumers who now mostly head to Singapore, a 11/2-hour flight away, to bag their middle- to high-end buys from shop locations they have memorised in malls such as Orchard Road's Ngee Ann City and Ion.

The new brands will liven up the capital's dull shopping experience as they compete for the increasing incomes of Indonesian consumers.

If infrastructure and other obstacles to expansion are overcome, consumer spending in the world's fourth most-populous nation could rise about 8 per cent a year to US$1.1 trillion (S$1.36 trillion) by 2030, says research consultancy McKinsey in a report.

South-east Asia's largest and strongest economy has grown at 6 per cent or more in the past three years. Its domestic market accounts for around 60 per cent of gross domestic product, cushioning Indonesia from external economic shocks.

"In the 1990s and 2000s, smaller foreign brands entered the market, but now, the big ones are coming in, reflecting the changing lifestyle and rising affluence," said Mr Anton Sitorus, head of research at realtor Jones Lang LaSalle. The earlier entrants were brands such as The Body Shop and Next.

A Credit Suisse report in January noted rising consumer confidence - spending on fashion last year rose by 25 per cent. Per capita income is expected to rise to US$6,000 in 2030, up from US$3,660 now.

The major retailers that have announced their move here are making a big splash.

The first outlet of Japanese clothing chain Uniqlo, that is expected to open in June, will measure nearly 2,700 sq m - the second-largest in South-east Asia after a store in Thailand. Even before it opens in the new Ciputra Mall complex in South Jakarta, the company is already planning to open another 10 stores in the next three years.

Swedish brand H&M will open next year in Grand Indonesia Shopping Town in central Jakarta, in a space that will beat the sizes of its outlets in Singapore, Malaysia and Thailand.

Another Swedish giant, furniture store Ikea, is expected to plant its footprint next year too.

But space is running out in the capital, due to already high-density land use and a moratorium on construction of new malls imposed by the new governor.

Occupancy rate is already 93 per cent and there is only 500,000 sq m of space left in central Jakarta till 2015 when the moratorium ends, say property analysts.

This has forced retailers to look outside central Jakarta. Japanese mall developer Aeon has partnered local property developer Sinar Mas Land to build a 10ha mall, touting it as the country's biggest suburban mall, in Tangerang, about 25km west of Jakarta.

Others are looking at booming cities such as Makassar in South Sulawesi, Balikpapan in East Kalimantan or even Bali, says Mr Handaka Santoso, chairman of the Indonesia Retail Mall Association.

But he wants the big brands to be in Jakarta to woo shoppers from the provinces and those who go to Singapore.

Retailers have worked out the tax costs and priced their goods competitively, he said, adding that prices for the same goods found in Singapore can be cheaper here.

"We are serious about transforming (the shopping experience). We want to keep the money in our country and put Jakarta on the shopping tourism map," he said.

zubaidah@sph.com.sg

[dydx]

Having read the 1st issue of the "Applause: the Kingsmen Experience"......
http://www.kingsmen-int.com/wp-content/p....php?id=44
- which I believe is a 'must read' for all who are interested in this still evolving enterprise - twice and in detail over the weekend, I get a strong positive feeling that Kingsmen is poised to grow and grow across Asia in the next few years. Any views from other forumers?

[Musicwhiz]

Having read the 1st issue of the "Applause: the Kingsmen Experience"......
http://www.kingsmen-int.com/wp-content/p....php?id=44
- which I believe is a 'must read' for all who are interested in this still evolving enterprise - twice and in detail over the weekend, I get a strong positive feeling that Kingsmen is poised to grow and grow across Asia in the next few years. Any views from other forumers?

I obtained a hard copy of the above publication at the recent AGM (held on April 30, 2013), and though I have not read it cover to cover, I must say that Benedict and Simon were very candid and upfront during the meeting and this gave me confidence that the Company will remain prudent and pursue slow, steady growth rather than do something foolish.

In terms of growth, yes it would seem that there are good prospects but Kingsmen needs to beef up its team and hire more qualified staff, which could be a short-term problem. In the medium-term, they would also need to shift to larger premises for which they are looking for now. I guess this may constrain the growth of the business until then.

[dydx]

Presently Kingsmen is actively hiring, especially in Singapore, Greater China (including Hong Kong and Taiwan), India, Malaysia and UAE.....
http://www.kingsmen-int.com/careers/#
Quite clearly, business outside Singapore is going to grow at a quick pace! No?

[Musicwhiz]

Hi all

I was researching KC's annual reports. While top line growth has been impressive over the past few years. this hasnt really translated to bottom line and EPS growth. any concerns on this or have I missed something? Otherwise the company does look like it has gd fundamentals.

Sorry I missed your question the last time.

During the AGM, it was shown that Kingsmen has grown revenues by a CAGR of about 10% over 4 years and NPAT at about 5% over the same period.

I wouldn't really call 10% CAGR "impressive", more like slow and steady. While it is true that NPAT growth has been less than revenue, we must factor in new business segments (theme parks), higher personnel costs and more labour intensive operations (for setting up of theme parks, larger events/exhibitions etc). I think the Group has done admirably in growing slowly but steadily over the years.

These are not major concerns for me. GPM and NPM are steady and stable and ROE is >20%, plus there is consistent FCF generation.

Would be good to hear from you if you have any other views or observations of the Company.

[valuestalker]

Guess which brand replaces National Geographic store @Vivocity (closed down last month)?
It is none other than H&M.
And the store is indeed handled by Kingsmen.
H&M is one of the Kingsmen's client that expanding fast in Spore (another one is Uniqlo).
Well done, keep it up, The King's Men.

[dydx]

It is really good that Kingsmen has a strong focus on fashion retail fit-out and has developed a lot of experiences and expertise in this area over the years, giving the company a certain dominant market position and good reputation now especially in the high-end brands (e.g. Tiffany, Chanel, etc.) and fast-growing mid-price brands (e.g. H&M, Uniqlo, etc.) segments.

[Musicwhiz]

This would spell more opportunities for Kingsmen's Interiors Division.

The Straits Times
www.straitstimes.com
Published on May 10, 2013
North Asian retailers out to woo local shoppers
Besides filling Orchard Road malls, they are moving into heartland

By Cheryl Ong

NORTH Asian retail brands are joining the array of international brands in Singapore and even making their way into the suburbs.

The influx of the regional brands is in response to increasing demand from South-east Asian markets, said property research and consultancy firm Savills yesterday.

Along the shopping belt of Orchard Road, Hong Kong fashion conglomerate i.t has committed to a total 20,000 sq ft of retail space at the upcoming orchardgateway and Wisma Atria.

South Korean fashion labels are also making their presence felt - leading apparel brand Headline Seoul opened its flagship store at Wheelock Place in January; popular shoe label Spur made its debut at Plaza Singapura in February.

But the rising affluence of heartlanders has also led North Asian brands to look for retail space in suburban malls, noted Savills Research senior director Alan Cheong.

Japanese retailer Books Kinokuniya, for example, will open its newest outlet at Jem, the upcoming mall in Jurong East. Korean bakery chain Paris Baguette will set up its second outlet at the suburban mall.

"It's a movement of the brands that (first) set foot in Orchard Road into the suburbs," said Mr Cheong.

Meanwhile, the supply of net lettable area in suburban malls is expected to rise by 2,165,000 sq ft when newcomers like Westgate, Big Box, Bedok Mall, The Seletar Mall, Hillion Mall, Waterway Point and Jem are completed.

But demand for suburban retail space still outstrips supply, and rentals are still expected to remain strong, rising at 6 per cent every three years and 2 per cent on an annualised basis, Mr Cheong added.

"That sends the message that the market is actually in the suburbs."

However, even as more retailers are moving to the suburbs, rents for prime space in the city, Orchard Road and Central Business District, are likely to be maintained.

The average monthly rent for prime space of between 500 sq ft and 1,500 sq ft in Orchard Road was $35.10 per sq ft (psf) in the first quarter, according to Savills.

Stores that target the mass market and thrive on high turnover volumes will continue to strengthen their presence in the prime areas, Savills said.

For example, popular brands like H&M, Sephora and Uniqlo are set to open at Suntec City after renovations there are completed.

For landlords of suburban malls, they may prioritise securing more anchor tenants rather than asking for higher rentals from specialty stores to ensure higher occupancy rates in their malls, said Mr Cheong.

Anchor tenants, such as departmental stores, pay lower rents on a psf basis, but take up more lettable area. Specialty stores, like fashion retailers, take up smaller spaces at higher rents.

"It is easier to fill up a mall with anchor tenants," he said.

"But if you want to be different from others, like Tampines Mall or Junction 8, then you may want to fill up most of the mall with specialty stores."

ocheryl@sph.com.sg