China Aviation Oil

[Nick]

CAO to invest in oil storage terminal in Yeosu, Korea

• CAO to invest US$32 million for 26% equity stake in joint-venture company

• Investment to strengthen CAO’s ability to ensure jet fuel supply and add trading value

http://info.sgx.com/webcoranncatth.nsf/V...300358D28/$file/CAO_Media_Release_Project_Seagull.pdf?openelement [Press Release]

http://info.sgx.com/webcoranncatth.nsf/V...300340564/$file/CAO_SGX_Announcement_Project_Seagull.pdf?openelement [SGX Announcement]

A second green field project secured in a week and the appointment of a newly created COO position is certainly a positive sign for CAO trading business prospects.

(Not Vested)

[Nick]

CAO’s net profit up 23.6% in 3Q 2011 to US$17.0 million

- 9M 2011 net profit increased 29.1% to US$57.7 million, surpassed FY2010 net profit
- 3Q net profit growth driven by strong performance of jet fuel supply and trading business

http://info.sgx.com/webcoranncatth.nsf/V...400397EA0/$file/CAO_Media_Release_3Q2011.pdf?openelement [Press Release]

http://info.sgx.com/webcoranncatth.nsf/V...4002FBD64/$file/CAO_Results_3Q2011.pdf?openelement [SGX Announcement]

I was fairly surprised with the latest result due to its strong trading performance at company level and the continued profitability of its underlying associates despite the volatile oil prices. It must be noted that for the first time in years, CAO is in a net debt position and this will most likely continue judging by the recent investments in oil storage terminals in Asia. CAO market capitalization stands at $690 million.

(Not Vested)

[mrEngineer]

Oil prices are going up at the moment. I guess CAO will stand to gain in the next quarter results

[Nick]

CAO expands global footprint with acquisitions in Hong Kong and North America

http://info.sgx.com/webcoranncatth.nsf/V...700825681/$file/CAO_Media_Release_Project_Sunrise.pdf?openelement [Press Release]

http://info.sgx.com/webcoranncatth.nsf/V...70081F59D/$file/CAO_Project_Sunrise.pdf?openelement [SGX Announcement]

CAO has been on a spending spree in recent months in its bid to build up its trading platform and diversify into new regions. The 2 companies are acquired at US$16 million and it generated 9M 2011 PBT of US$2.78 million. CAO share price is currently trading at S$1.09 giving rise to a market capitalization of S$787 million and it generated 9M 2011 NPAT of US$57.7 million.

(Not Vested)

[D123]

While CAO do monopolize the import of jet fuel in PRC, what will happen if the PRC ramps up its refinery capabilities to produce its own jet fuel and hence render CAO services redundant ?

I think maybe that's why they have been diversifying their operations into owning pipelines and storage facilities. Besides helping them store inventory and allowing them to take positions on oil prices, it gives them possession of some assets that have the potential to earn utility-like returns.

I find it strange that the Company repurchased shares when it was trading at $1.20-1.40 level half a year ago but they don't seem keen to repurchase it now ?

Could be that share buybacks were not intended to be the main way of rewarding shareholders. They need some treasury shares as they have stock options to cater for, and they cannot dilute existing shareholders (CNAF mainly) due to covenants tied into some of their lending facilities.
See here: http://info.sgx.com/webcoranncatth.nsf/V...60046E626/$file/CAO_Disclosure_under_Rule_704_31.pdf?openelement

[wahkao]

looking at CAO now
The fundamentals are great:
stable net income quarter on quarter (but not cashflow)
Low debt
High ROE

Risks:
High account payable. Probably operating on interest-less supplier credit, which is kind of good actually. Giving it high ROE
unstable cashflow


valuation is good
rolling PE 8.1
P/book 1.17

[Image: UcemEaY.png]

[greengiraffe]

http://www.businesstimes.com.sg/premium/...s-20141004

PUBLISHED OCTOBER 04, 2014
CAO eyes more acquisitions
China and Europe are key markets in group's bid to double its 2012 gross profits by 2020
BYANDREA SOH
sandrea@sph.com.sg @AndreaSohBT


'Only after you become an integrated player do you then become competitive'
Singapore
CHINA Aviation Oil (Singapore) Corporation (CAO), which has set out a goal to double its 2012 gross profits by 2020, is on the prowl for more acquisitions to augment its growth.
"The investments so far are still not enough to meet our target," its chief executive Meng Fanqiu said in Mandarin in an interview. "So one focus going forward will be to increase our investments."
The key markets will be China, where the company is an established player, and Europe, where investments could help boost its nascent operations, said Mr Meng.

[greengiraffe]

http://www.businesstimes.com.sg/companie...rd-quarter

CAO's net plunges 66.5% to US$7.32m in third quarter
Operating loss swells fivefold from Q3 2013 to US$7.54m this year

By
Claire Huanghuangjy@sph.com.sg@ClaireHuangBT
7 Nov5:50 AM
Singapore

CHINA Aviation Oil (Singapore) (CAO) has posted a 66.5 per cent drop in net profit to US$7.32 million for the third quarter, weighed down by operating losses and lower contribution from its associates. The jet fuel trader incurred an operating loss of US$7.54 million in Q3 2014

[pianist]

wow..what happened? plunged so much

[davisng]

maybe because of the inventory risk due to oil prices dropping.