New Toyo

[pianist]

New toyo is it also doing food packaging

[potatolover]

New toyo is it also doing food packaging

MOst of the revenue/profit is from cigarette packaging, which is more resilient and profit margin higher....probably 80%.

[Underdogger]

Have your friends finished dumping?

it seems people kept dumping at 27.5 cents...

heard from some friends that many are starting to dump off below 30 cents - few hundred lots.....so this might depress price for a while ...

they got tired of waiting for news; also, they heard that printing margin has been depressed from rising cost of materials....

[potatolover]

Amcor announces US$114.8 million acquisition of AGI-Shorewood’s Tobacco Packaging operations.
Amcor announces today it has agreed to acquire select printing assets of AGI-Shorewood’s Tobacco Packaging and Specialty Folding Carton Operations for US$114.8 million. The acquired business has plants or assets in each of South Korea, USA, Mexico and China. The acquisition excludes the AGI-Shorewood plant in Smiths Falls, Canada.

15 February, 2013: The acquisition expands Amcor’s business in the higher growth regions of Asia and Latin America and includes specialty folding carton production assets in the United States. In Mexico it builds on the position established by Amcor following the recent acquisition of Aluprint.
For the 2012 calendar year the acquired business had sales of US$126 million and EBITDA of US$22 million. The EBITDA purchase multiple is 5.2 times based on the last twelve months of earnings.
Net synergy benefits are anticipated to be approximately US$13 million and the net cash cost to achieve these synergies is expected to be approximately US$20 million. The acquisition is expected to deliver a return on investment of more than 20% by the end of year three.
In South Korea the business has approximately 30% share of this high value add market and supplies major international customers. The plant, built in 2004, is well capitalised and has a strong technology and product innovation focus.
Amcor’s Managing Director and CEO, Mr Ken MacKenzie, said: “This acquisition is aligned with our strategic objective of expanding our position in emerging markets. The attractive purchase multiple and substantial operational cost synergies ensure the acquisition will generate very attractive returns for shareholders.”

[Underdogger]

New Toyo’s full year FY12 projected EBITDA = S$37.9mil
With 5.2 EBITDA multiple, approx $200mil, New Toyo will be valued at 45.5 cents.
( this is excluding the SAH cash payout of 12.5 cents, and all its investment properties rationalization, etc)
(1st 9 month of FY12, EBITDA = S$28.4mil)

How much will Amcor value New Toyo ?

Amcor announces US$114.8 million acquisition of AGI-Shorewood’s Tobacco Packaging operations.
Amcor announces today it has agreed to acquire select printing assets of AGI-Shorewood’s Tobacco Packaging and Specialty Folding Carton Operations for US$114.8 million. The acquired business has plants or assets in each of South Korea, USA, Mexico and China. The acquisition excludes the AGI-Shorewood plant in Smiths Falls, Canada.

15 February, 2013: The acquisition expands Amcor’s business in the higher growth regions of Asia and Latin America and includes specialty folding carton production assets in the United States. In Mexico it builds on the position established by Amcor following the recent acquisition of Aluprint.
For the 2012 calendar year the acquired business had sales of US$126 million and EBITDA of US$22 million. The EBITDA purchase multiple is 5.2 times based on the last twelve months of earnings.
Net synergy benefits are anticipated to be approximately US$13 million and the net cash cost to achieve these synergies is expected to be approximately US$20 million. The acquisition is expected to deliver a return on investment of more than 20% by the end of year three.
In South Korea the business has approximately 30% share of this high value add market and supplies major international customers. The plant, built in 2004, is well capitalised and has a strong technology and product innovation focus.
Amcor’s Managing Director and CEO, Mr Ken MacKenzie, said: “This acquisition is aligned with our strategic objective of expanding our position in emerging markets. The attractive purchase multiple and substantial operational cost synergies ensure the acquisition will generate very attractive returns for shareholders.”

[Stockerman]

Once this counter goes more than 30 cents, better to just dump and lock in profits...
in the last one year or so, it has tried to keep its head above 30 cents but failed....

Paying anything more than 25 cents for this counter is quite silly, according to comments from some friends...
1/3 of its profits was GONE with winding down of SAH...

[Stockerman]

Currently, BAT is importing products from Malaysia with Filipino leaf.
i.e. BAT(M) is supplying the Philippines market, possibly with printed cartons and specialty paper from Tien Wah/New Toyo.

But once the manufacturing plant is up and running in Philippines, will BAT(M) and hence Tien Wah/New Toyo (cigarette cartons, specialty papers) be bypassed, meaning less business for Tien Wah/New Toyo?





*******

http://www.philstar.com/business/2013/02...tte-brands



MANILA, Philippines - Global tobacco giant British American Tobacco is looking to launch new brands, including a budget-oriented one, in the Philippines as part of efforts to increase its market share and tap a wider client base.

BAT produces famous selling brands Lucky Strike, Dunhill, Kent, and Pall Mall, which accounted for more than 30 percent of the group’s worldwide volumes in 2011 or 226 billion cigarettes.

It only sells Lucky Strike in the Philippines with total sales of a few million cigarette sticks last year.

“We’re looking at introducing new brands. We have Lucky Strike now but we’ll have multiple brands in the market as we go along. Lucky Strike is quickly establishing itself in the marketplace. We’re seeing an opportunity to bring in new brands here. We may bring in a low-tier brand,” BAT Philippines general manager James Lafferty said in a briefing.

Lafferty said the introduction of new brands is also part of BAT’s commitment to invest around $200 million over a five-year period in the Philippine market following the passage of the controversial sin tax bill.

Lafferty said the group is mulling the establishment of a manufacturing plant in the Philippines but noted that nothing has been firmed up.

“We’ re certainly committed to stay. We’re investing full speed ahead. The $200 million investment could even go up should we decide to put up a manufacturing facility here,” Lafferty said.

Meanwhile, he said the company would continue importing products from Malaysia with Filipino leaf. “We will continue doing that while we study manufacturing options. We will manufacture here at some point in time but I don’t have a proposal yet,” the BAT official said.

The firm failed to hit its sales target of 150 million sticks last year but is hopeful it will perform better this year as it benefits from a level playing field with the enactment into law of the sin tax reform bill.

“Lucky strike is still in the launch phase, it’s still brand new and still with a 0.01 market share…At some point we’d like to move up. We’re a modest company with modest goals. We hire good people, pay the right taxes and do the business right,” Lafferty pointed out.

With more than 200 brands in our portfolio and a significant global presence for over 100 years, BAT is the cigarette chosen by one in eight of the world’s one billion adult smokers. The group holds robust market positions in each of its regions and has leadership in more than 50 markets.

[Stockerman]

DOOM for tobacco makers -

New Zealand announced plans to force tobacco companies to sell cigarettes in plain packaging, making it the second country after Australia to introduce such measure. The government will introduce legislation later this year but delay enforcing it until the legal challenges launched by tobacco firms against Australia’s ban has been decided.

[smalkmus]

Dear value buddies,

Tobacco is a business that, to new entrants or those who are interested, will always be a business that is impossible to enter. All these regulations will only be a boom to the incumbents. From what I heard, the plain packaging has not dampen the off take. It only serves to even heighten the interest in the tobacco over that short term. The business is amazingly resilient.

Coming from a packaging supplier perspective, New Toyo might stand to gain as business gets consolidated and the focus is on getting the best partner (provided they are up to mark), I believe New Toyo still has some legs to run as the tobacco business is very much a loyal business and other supplier, due to social perception as well as start up cost might be hesitant to enter.

Vested. 2 cents of opinion

[Stockerman]

However resilient the tobacco/packaging business is, somehow New Toyo’s stock valuation is still deeply discounted to its NAV.

Printing volumes from Australia and New Zealand are expected to decline rather rapidly over time...New Zealand is aiming to be smoke-free in the next few years...

Armed forces have pared down its share holdings of Tien Wah over time, and more recently, it was quite a bit of selling down...

Dear value buddies,

Tobacco is a business that, to new entrants or those who are interested, will always be a business that is impossible to enter. All these regulations will only be a boom to the incumbents. From what I heard, the plain packaging has not dampen the off take. It only serves to even heighten the interest in the tobacco over that short term. The business is amazingly resilient.

Coming from a packaging supplier perspective, New Toyo might stand to gain as business gets consolidated and the focus is on getting the best partner (provided they are up to mark), I believe New Toyo still has some legs to run as the tobacco business is very much a loyal business and other supplier, due to social perception as well as start up cost might be hesitant to enter.

Vested. 2 cents of opinion