Hi Greenrookie,
I had been to the Foreland AGM today morning and had very meaningful one to ones with
1. Mr. Tsoi Kin Chit (Executive Chairman)
2. Mr. Simon Wong (CFO)
3. Mr. Lim Siang Kai (Independent Director)
4. Ms. Susan Foong (Partner at Baker Tilly-Their auditors)
They were well prepared with answers to the queries I had sent them. I will just list out the responses to them out here. These responses have come from the above listed people:
(1) They plan to move the machinery from the existing plant to the new plant. The existing plant will not be used once the moving is completely done. The land the current plant is on can now be used for residential purposes. So they plan to either:
- Sell the plot of land
- Get into construction of residences on that plot with some development company
They have not yet finalised on what would be the final course of action because there is still some time before the production moves completely into the new premises.
(2) Simon had brought along photographs of the new production facilities. The plant is indeed up and so is the staff dormitory.
- They have installed some machinery in the plant but more work can only be done once they receive the environmental clearances which is now the main reason for stoppage of work.
- They will build the water treatment facilities once they know the new environmental regulations and requirements. Once they get the necessary environmental clearances it will take between 3-6 months for the water treatment facilities to be constructed and for actual production to start.
- In terms of timelines they expect prodution to start at the new facility in Q4 of this year. It will take about 6 months to move the entire production from the existing factory to the new one. BTW the new land purchased is on a 50 years lease acccording to Mr. Lim Siang Kai.
(3) (4) (5) Current production capacity is 60.8 million yards and the new enhanced capacity will be about 80 million yards (30% increase). This is expected to happen after the move to the new plant. Consequently the financial numbers for 2012 will not differ greatly from those of 2011. I would expect things to really look up from 2013.
(6) They made the share placements at S$0.1235 in June 2011 to some major shareholders to increase the liquidity and the price of shares. But 9 months down the road nothing seems to have improved. Liquidity is still low and the share price keeps going lower still (It ended the day at S$0.091). It was my suggestion to Simon that if they really want to reward shareholders they should keep increasing the dividend payout on a regular basis as the business keeps growing
and their cash requirement for new construction goes down
and of course their cash balance keeps balooning ( :
Simon took the inputs in the right spirit. Now we have to wait and see if they do increase dividend payments in times to come.
Inputs from the Auditors (Ms. Susan Foong):
They carry out regular checks on the cash balances and the numbers reported by Foreland are all above board. Interestingly Baker Tilly are also the auditors for World Precision Machinery. They currently audit around 20 companies listed on the SGX.
Suggestions:
(1) They did bring across photographs of the new facility
(2) We all had the joy of watching the products manufactured by Foreland. That I guess is one of the main reasons I am invested in them and they did not disappoint.
We saw umbrellas with prints coming on them as water was poured. There were other samples where colors filled up the designs on the umbrellas as water was poured. These products are mainly sold in the Japanese and Korean markets. Interestingly I have never seen one of these umbrellas in Singapore till today.
This was one of the most fruitful AGM's that I have attended and hopefully Foreland will not disappoint in the years to come. Management is very open to getting shareholders to visit their plant. If we can form a group to go down to Jinjiang City, Fujian Province, management would love to host us out there for a couple of days. We just need to inform Mr. Lim or Simon about our planned timelines and they will make necessary arrangements for us to stay there.
Last but not the least, I got an umbrella from management. This is a perfectly plain lavender coloured umbrella when dry. But pour water on it and beautiful flowers appear all over. Will keep it as a treasured memento (:
Do let me know if there are any other questions you have or any other information you need.
Regards,
(27-04-2012, 05:25 PM)Greenrookie Wrote: hi sgmystique,
Any updates on foreland AGM? Appreciate your input, especially on the status of new production facilities. Many thanks.
"You are right not because the world agrees or disagrees with you, rather you are right because your facts & reasoning are right."
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