New Toyo

[Stockerman]

Cannot agree more with GG.

Just imagine the tissue box fiasco, the SAH saga and many others...

Some counters exist for ulterior reasons (e.g. money laundering, etc). I will not rule out this possibility. Afterall, it is SIN industry. Anything is possible.

Dont believe? go and walk around Lucky Plaza and look at what some shops are selling. How do they survive the expensive rentals? haha...

[greengiraffe]

Absolutely, I can't agree with you more as well... Enough is enough... let's move on to search for better ideas...

GG

Cannot agree more with GG.

Just imagine the tissue box fiasco, the SAH saga and many others...

Some counters exist for ulterior reasons (e.g. money laundering, etc). I will not rule out this possibility. Afterall, it is SIN industry. Anything is possible.

Dont believe? go and walk around Lucky Plaza and look at what some shops are selling. How do they survive the expensive rentals? haha...

[portuser]

It is a JV between Tien Wah (51%) and New Toyo (49%) that controls Anzpac.
It also serves as a conduit/trading post where New Toyo will cream off a certain % for commission. MEIL is located at Hong Kong.
New Toyo's effective stake in MEIL is 76.5%, comprising its 49% direct stake and indirect stake through Tien Wah. The set up of MEIL was an ingenious move as it allows New Toyo to cream off most of the group’s profit (approximately 70%). Had MEIL been 100% owned by Tien Wah, New Toyo share of group profit would have been only 54% since it owns 54% of Tien Wah.

In seeking sharholders' approval to acquire Anzpac and take on the seven-year supply contract from BAT, both New Toyo and Tien Wah explained that while Tien Wah operated the cigarette carton printing business within the New Toyo Group, a joint venture, combing the strengths of the two, stood a better chance of convincing BAT than Tien Wah were to act alone.
It is also necessary to note that Tien Wah was once a one-factory concern. It grew only after being acquired by New Toyo, who then injected its two low-cost printing factories in Vietnam into Tien Wah, making Tien Wah a bigger and more resilient outfit.
Investment in MEIL exposes New Toyo to risks. Frequent package refreshing required by BAT entailed equipment acquisition, revision of work flow and more product development and innovation. More recently, BAT has required production of low-defect cartons.
It is true that New Toyo, through its stake in MEIL, is now benefiting more, as Tien Wah has responded to BAT's requirements well. But at the outset there was no certainty that Tien Wah could fulfill BAT requirements; and had Tien Wah failed, New Toyo would bear a larger share of loss.
The higher share of Tien Wah profit may be viewed as fair reward for risk taking by New Toyo.
There have been laments that Tien Wah is being bullied by BAT. Another way of viewing this is that BAT's demands have provided Tien Wah the opportunities to rise to the challenges and set itself apart from the rest in the industry.

[investright]

Future of E-Cigarettes in Question on European Crackdown

Just when smokers thought it was okay to inhale again, a debate over the safety of electronic-cigarettes is threatening to cut off their nicotine.
Smokeless and odorless e-cigarettes are catching on, touted in the U.S. and Europe as less harmful than real ones because they don’t contain tar, arsenic and other cancer-causing toxins. Yet a U.K. government decision this week to treat the steel tubes as a medicine and a plan by France to ban them from public venues raises questions about what health risks the devices carry.
Enlarge image
Photographer: Spencer Platt/ Getty Images
E-cigarettes, on the market in the U.S. and Europe since 2006, are battery powered devices that deliver vaporised nicotine and light up when puffed. Faulty e-cigarettes have been known to explode, causing second-degree face burns, U.K. health regulators said earlier this week. And because e-cigarettes give a dose of nicotine to users, there’s growing concern that the device can become addictive.
“Current controls look at battery safety, electrical safety, but they don’t focus on what’s in the product and how it’s delivered,” said Jeremy Mean, a risk management official at the U.K.’s drug regulator.
That’s a warning shot for the small yet fast-growing e-cigarette market. The sector will approach $2 billion in sales by the end of 2013, and may exceed $10 billion by 2017, according to Bonnie Herzog, an analyst at Wells Fargo & Co. in New York. Demand for the smokeless devices may surpass that of traditional cigarettes in the next decade, Herzog said.
As manufacturers and tobacco companies step up their e-cigarette advertising in the U.S. and as the device gains popularity on both sides of the Atlantic, the biggest concern among British and French health officials is so far unproven: that e-cigarettes could lead users to graduate to the real thing.
European Template
“E-cigarettes must become an aid to quit smoking, not a tool to enlarge the number of smokers,” said Jean-Louis Touraine, a Socialist lawmaker, doctor and expert on health-care policy. “They are becoming a fad, and many young people are being attracted to them.”
In the U.S., the Food and Drug Administration intends to propose a regulation that would expand its authority over e-cigarettes, though no time table has been set, according to Jenny Haliski, a spokeswoman for the agency. Regulators in Europe are moving more quickly. And the U.K. decision will probably serve as “a template” for a European Union ruling, said Erik Bloomquist, an analyst at Berenberg Bank.
In the U.K., the devices will be licensed as medicines by 2016 and overseen by the Medicines and Healthcare Products Regulatory Agency, which will require manufacturers to present data on the quality of their products, on how they deliver nicotine to the body and on how they compare with other nicotine-replacement products, the agency said June 12.
Reduced Cravings
E-cigarettes have been shown to reduce cravings and withdrawal symptoms, leading some people to cut down on smoking. And existing research has found no connection to heart disease.
Still, the devices use ingredients that can irritate the airways and cause allergic reactions, the German Cancer Research Center noted earlier this year. A study by scientists at the University of Athens found that they trigger an increase in airway resistance that lasts 10 minutes, making it harder for participants to breathe.
French Healthcare Minister Marisol Touraine said May 31 she plans to seize the country’s highest administrative court in a bid to ban the devices in public places. Touraine cites the potential long-term health impact, nicotine content and possible introduction to smoking as reasons to regulate devices that “strikingly resemble cigarettes.”
Some public health experts say the urge to take the safe route with e-cigarettes risks is causing more harm than good.
‘Hand Grenades’
“We should be doing everything to encourage smokers to shift to new nicotine products,” said Gerry Stimson, an emeritus professor of health behavior at Imperial College in London. “The desire to make them safer is leading to over-regulation and it will in effect turn them into a medicine and make them harder to obtain than cigarettes. It’s a shame.”
Many former smokers agree. “This is effectively condemning people to going back to smoking cigarettes,” says Dave Dorn of Sunderland, in northeast England, who adopted the smokeless tubes four years ago. Dorn, who produces an Internet-broadcast program on e-cigarettes called Vapour Trails that features ads for the devices, says none of those currently for sale will meet the U.K.’s new regulations.
Poor Comparison
Adrian Everett, chief executive officer of closely held Zandera, says e-cigarettes should be viewed as a tobacco alternative, not a smoking-cessation tool. He objects to drawing parallels with the real thing.
“To compare electronic cigarettes to tobacco cigarettes is like comparing playing football with juggling live hand grenades,” he said in a telephone interview.
Amid evidence that more customers are adopting the product -- including Hollywood celebrities such as Charlie Sheen and Lindsay Lohan -- tobacco companies are also investing to counter declining sales of traditional cigarettes.
Lorillard Inc. (LO) based in Greensboro, North Carolina, last year acquired Blu Ecigs for $135 million. Altria Group Inc. (MO) of Richmond, Virginia, has said it plans to introduce an e-cigarette later this year.
The U.K. decision may give tobacco companies and larger e-cigarette companies the upper hand by mandating a costly level of product scrutiny, according to Berenberg’s Bloomquist.
“It’s clearly a benefit for tobacco companies,” he said. “It will put in place requirements that they meet certain regulatory standards and they are the ones that will be able to do that.”
Vapoteur Tips
In France, the product has struck a chord with people from Paris cafes to the old Mediterranean harbor of Marseille, where converts can be found sharing stories, drinks and tips on new e-cigarette products and flavors.
More than 1 million people in France are now regular users, compared with 500,000 at the end of last year, according to a government-commissioned report published last month. The country has more than 150 dedicated shops, according to the report, a number expected to double by year-end. And users have coined a new verb to describe their smokeless puffing, the French “vapoter.”
Amaury Delamaire, a 20-year-old student at the Sorbonne in Paris, says freedom to indulge in public places is a reason he switched.
“There is no way I’ll stop,” Delamaire said as he popped into the AlterSmoke store in the Latin Quarter, one of the dozens of dedicated shops that have sprouted on Paris streets, for a refill. “I’ll just have to be more discreet.”
Others aren’t so sure.
“Why switch to electronic if you can’t use them in places where regular cigarettes are forbidden,” said Marilyn Kaye, an American writer living in Paris. Regulators “want to deny the right of people to enjoy themselves in a way that does not harm others. It’s ridiculous.”
Source: Bloomberg

[Stockerman]

e-cig will lead to the slow decline of conventional tobacco products like cigarettes, reducing the volume as well as the need for numerous packaging.

What future is there for traditional tobacco packaging/printing such as Tien Wah/New Toyo?
Soon they will go out of business....

---

e-cig will lead to the death of traditional tobacco packagers and printers. There is no future for Tien Wah and New Toyo. Period!
Even Tien Wah own CFO is cashing out all her holdings when she can now. Check out announcements at KLSE!

[pianist]

bases on the article, it seems like e- cigar met some hiccup.

[Underdogger]

in my own view, e-cig is just a ruse to get more advertisement space in the world media.

The real thing is still the traditional cigarette.

[Stockerman]

I also agree with Paullow that redevelopment of land/investment properties at Tien Wah will not be so soon. In fact, it probably will not happen until at least 5 yrs later...

if any, KL central will be re-developed first , rather than PJ. If you have Malaysian friends, U can check. those waiting for Tien Wah/New Toyo to huat big because of land redevelopment can wait until the cow comes home.

Looking at the way Malaysian does things, it is going to take a long long time....

[paullow]

2 issues here.

1) m'sia ppties are leasehold and redevelop timing are in question. M'sia is so damn big. It's not as though we are talking abt bukit bintang. For s'pore any land which is freehold will NOT go cheap because s'pore is land scarce.

2)more importantly, even if land development happens, what is the likelihood that shareholders will get benefit if any? Lets see whether there any special dividends first.

BUT all in all, I feel that downside is indeed guarded at current price, and if one is happy just to get that 1.5-2c per yr dividend, I think by all means. More than that, I think it's hard to say.

[Stockerman]

I am holding New Toyo for its dividend yield, nothing else.
if price goes up, yield will come down and NT will be much less attractive.

I dont expect much EPS growth from this point onwards. All the printing factories are already running at full capacity. Where is the EPS growth going to come from? Operational efficiency is not going to lead to a quantum leap in EPS..

2 issues here.

1) m'sia ppties are leasehold and redevelop timing are in question. M'sia is so damn big. It's not as though we are talking abt bukit bintang. For s'pore any land which is freehold will NOT go cheap because s'pore is land scarce.

2)more importantly, even if land development happens, what is the likelihood that shareholders will get benefit if any? Lets see whether there any special dividends first.

BUT all in all, I feel that downside is indeed guarded at current price, and if one is happy just to get that 1.5-2c per yr dividend, I think by all means. More than that, I think it's hard to say.