The Trading Floor - 2019

Discussion in 'The Trading Floor' started by Amator, Jan 1, 2019.


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  1. Amator

    Amator Well-Known Member

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    SINGAPORE (Jan 29): RHB is maintaining its “buy” call on United Overseas Bank (UOB) with a lower target price of $29.80 from $30.80 previously.

    This is due to the bank’s slowing mortgage business, as a result of the residential property tightening measures, which took effect in Jul 2018.

    In a Tuesday report, analyst Leng Seng Choon says, “Nonetheless, with 9M18 YTD loan growth of 8%, we believe a 10% loan growth for 2018 is likely.”

    The bank’s 3-month Sibor averaged 1.73% in 4Q18, up from 3Q18’s 1.63%. It is currently at 1.89%, but there is some lag effect for the SIBOR’s rise to filter through to NIM widening.

    “As loan drawdown was muted due to the Jul 2018 property cooling measures, UOB deployed its excess funds to lower yielding and lower risk assets – we believe this is likely to have led to lending yields not gaining much despite the 4Q18 rise in Sibor,” says Leng.

    On the other hand, UOB had increased its fixed deposits more aggressively in 3Q18, and therefore did not need to compete to secure funding in 4Q18. As a result, cost of funds would have risen at a slower pace.

    NIM in 1Q19 also seems to be widening, supported by the recent repricing of home mortgages.

    Market uncertainty is seen to be affecting the bank’s non-interest income for 4Q18, due to market uncertainty. The analyst expects investment banking and trading incomes to likely be unexciting.

    “We are however, positive on the longer term efficiencies with digitisation initiatives both at the bank level and the national level (eg. PayNow by MAS),” says Leng.

    With a CoE assumption of 10.4% and yielding a target price-to-book ratio of 1.37 times, Leng believes that the premium over the counter’s 5-year historical price-to-book ratio of 1.25 is justified, given the rising NIM trend and more efficiencies from its digitisation efforts.

    UOB’s management has indicated its intention to lower CET1 CAR (from 3Q18’s 14.1%). The expectation of higher dividends could propel its share price higher.

    As at 3.05pm, shares in UOB are trading at $25.61 or 1.19 times FY19 book with a dividend yield of 5.0%.
     
  2. nottibird

    nottibird Moderator

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  3. Amator

    Amator Well-Known Member

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    SINGAPORE (Jan 28): M1, which is in the process of being taken private by Keppel and Singapore Press Holdings, reported 4Q18 earnings to $25.7 million, down 30.4% from a year ago.

    This brings FY18 earnings to $131.3 million, 8.5% lower than $143.5 million in FY17.

    Revenue for the quarter was $312.8 million, 3.7% higher than $301.7 million a year ago, mainly due to higher contribution from the group’s fixed services and handset/equipment sales, which saw revenue increase by 8.6% and 13.3% y-o-y, respectively.

    The increase in revenue was however offset by lower contribution from the mobile telecommunication services and international call service, which saw revenue decrease by 2.7% and 18.4% y-o-y, respectively.

    Operating expenses increased by 7.3% to $278.9 million from $259.8 million last year.

    As at Dec 31, customer base was 2.8% lower y-o-y at 2.165 million. Group’s cash and cash equivalents stood at $79.2 million.

    The group has declared an interim dividend of 5.2 cents and a final dividend of 6.0 cents, which will be payable on May 15.

    To recap, Keppel and SPH made a pre-conditional voluntary general offer for M1 on Sept 27, offering $2.06 a share. Bursa Malaysia-listed telco Axiata Group is M1’s biggest shareholder, with a 28.7% stake.

    As of Jan 21, Keppel and SPH hold a joint 34.35% stake in M1. Both companies don’t even need Axiata to tender its stake in M1 for the deal to go through. Through their joint firm Konnectivity, Keppel and SPH have obtained a waiver from the Singapore Exchange that allows them to take M1 private without Axiata, according to a Jan 7 statement. That’s on the condition that the shareholding of the public float exceeds 90%.

    On Jan 23, the offerors announced they won't raise their offer price “under any circumstances whatsoever.” Instead, they hae extended the closing date for the offer by two weeks to Feb 18, giving investors more time to consider tendering their shares.
     
  4. Amator

    Amator Well-Known Member

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    By:
    Andy Mukherjee
    28/01/19, 07:23 am
    (Jan 25): What’s not to like about Singapore’s office property market?

    Take a look at CapitaLand Commercial Trust’s 2018 results. Singapore’s biggest office landlord, owner of $10 billion of the city-state’s commercial buildings, finished the year with a record-high occupancy rate of 99.3%.

    [​IMG]

    To achieve this, the real-estate investment trust didn’t have to compromise on pricing, at least not too much. Average rents in December were $9.71 per month per sq ft, only 3 cents lower than a year earlier. Investors in the REIT took home 8.7 cents of dividend income last year. At Thursday’s closing price that works out to a yield of 4.6%, more than double what 10-year Singapore government bonds offer. Not bad for an investment-grade issuer.

    [​IMG]

    But where Singapore’s office market is becoming weaker is in its tenant mix. Banks, insurers and financial services firms account for 41% of CapitaLand Commercial’s rental revenue. However, in 2018, no bank or insurer signed a new lease with the landlord. As for financial services, they absorbed only 16% of the newly let-out area last year, compared with 25% in the previous 12 months. Even the contribution from the food and beverage industry, which had taken up 8% of new leases in 2017, fell to just 1%. Looks like Singapore’s office goers have all the Starbucks coffee and Ippudo Ramen Express they need.

    [​IMG]

    Meanwhile, supply shows no sign of abating. On average, 0.9 million sq ft will be added to the city’s office stock annually through 2023. That’s little different from the 1 million sq ft in net new supply in the five years through 2017 when there was demand for only half that much.

    Will demand pick up? For a city that thrives on cross-border flows of merchandise, services and capital, a slowing pace of globalisation doesn’t portend a rich harvest. Gains from Brexit could give a temporary boost. But the real excitement in Singapore is around its vibrant startup culture, especially around fintech and transport. Only a few winners from this set, though, will graduate from re-purposed factory sheds like BLOCK71 to Grade A offices in the central business district.

    The strength of Singaporean landlords lies in their balance sheets. Spooked by the financing crunch during the 2008-2009 crisis, they’re taking no chances in preparing for global interest-rate normalisation. CapitaLand Commercial extended the maturity of its debt by 1.5 years in 2018 without sacrificing interest costs. This is where the industry stands head and shoulders above Indonesian property groups like PT Lippo Karawaci Tbk, downgraded by S&P Global Ratings to CCC+ from B- on Thursday because of weakening liquidity.

    Even if slowing global growth and a full-blown trade war make tenants wobble, Singapore’s office landlords are still on solid ground.

    Andy Mukherjee is a Bloomberg Opinion columnist covering industrial companies and financial services. He has also worked for the Straits Times, ET NOW and Bloomberg News
     
  5. Amator

    Amator Well-Known Member

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    SINGAPORE (Jan 28): Keppel Corporation announced that a wholly-owned subsidiary Keppel Land Limited (KLL), Portsville, is divesting a 70% interest in Dong Nai Waterfront City (DNWC) to Nam Long Investment Corporation for a consideration of VND 2,313 billion ($136 million).

    DNWC is a company incorporated under the laws of Vietnam and had been granted the right to develop a township in Dong Nai Province.

    DNWC, jointly held by KLL and a joint venture partner, is undergoing a demerger and upon the issuance of an Investment Registration Certificate by the relevant Vietnamese authorities, DNWC will become a wholly-owned subsidiary of Portsville with the rights to develop a 170 ha plot of land. DNWC also currently holds a 28 ha plot of land which is excluded from the proposed divestment.

    Upon completion of the divestment, Keppel and KLL will hold only 30% interest in DNWC.

    This divestment is in line with KLL’s strategy to recycle assets to seek higher returns. The funds generated from this deal will be used to pursue other opportunities in Vietnam.
     
  6. plutus2

    plutus2 Well-Known Member

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    good morning Snipers... Bro Amator, thanks for all the result news
     
  7. nottibird

    nottibird Moderator

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  8. Amator

    Amator Well-Known Member

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    SINGAPORE (Jan 25): RHB Research is keeping its “buy” call on Singapore Exchange (SGX) with an unchanged target price of $8.20, on the back of strong growth in its derivatives business.

    SGX on Thursday reported 2Q earnings of $97 million, 9% higher compared to a year ago.

    Total revenue for 2Q rose 9% to $224 million from a year earlier, led by a 35% increase in derivatives revenue to $112.9 million.

    “We are bullish on derivatives volume numbers,” says analyst Leng Seng Choon in a report on Friday. “We believe market volatility will keep derivatives volume firm, though we have conservatively assumed FY19 derivatives average daily contract (DADC) of 897,000, versus 2Q19’s 938,000, and 1H19’s 900,000.”

    The research house has cut SGX’s FY19 net profit forecast by 2%, on lower securities average daily value (SADV) assumption. SADV fell 14% to $0.98 billion in 2Q19.

    However, RHB continues to favour SGX for its strong balance sheet and attractive yield.

    “SGX remains in a net cash position, with a monopoly over trading of Singapore-listed equities,” Leng says.

    “SGX is on track to hit our target 31 cents DPS for FY19 – which translates to a yield of 4%,” he adds. The board has declared an interim dividend of 7.5 cents per share, up from 5 cents last year.
     
  9. Amator

    Amator Well-Known Member

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    SINGAPORE (Jan 25): UOB Kay Hian is reiterating its “hold” recommendation on Mapletree Logistics Trust (MLT) with a target price of $1.39.

    Similarly, Maybank Kim Eng has a “hold” call on CCT, while OCBC Investment Research has a “buy” call.

    This came on the back of MLT on Monday announcing a 5.0% increase in its 3Q18/19 DPU to 2.002 cents, compared to 1.907 cents in 3Q17/18, bringing 9M18/19 DPU to 5.917 cents, 4.2% higher than 5.681 cents in 9M17/18.

    The trust posted gross revenue of $120.8 million in 3Q18/19, 23.0% higher than $98.2 million a year ago, mainly attributed to higher revenue from existing properties, contribution from the completed redevelopment of Mapletree Ouluo Logistics Park Phase 1 in 2Q FY18/19, acquisitions in Hong Kong completed in FY17/18 and acquisitions in Singapore, Australia and Korea completed in FY18/19.

    These results came in slightly above the research house’s expectations and on track to meet FY19 DPU expectation of 7.5 cents.

    MLT’s gearing saw a slight increase to 38.8% in 3Q19, while total debt outstanding increased by $105 million q-o-q, due to loans drawn fund the acquisition of one property in Australia and one property in South Korea.

    Overall occupancy rate also remain stable during the quarter at 97.7%.

    During the quarter, JD.com gave up half of their leased space in the Zhejiang project, leading to the trust’s decline in China occupancy to 95.8%, but management has so far been able to replace most of the spaces with smaller replacement tenants.

    In a Wednesday report, analyst Jonathan Koh says that this will help uplift its China segment’s occupancy in the next quarter. And due to stronger negotiating power with the small tenants, the analyst reckons that renewals may even see positive rental reversions.

    Meanwhile, in terms of acquisitions, the management is focused on completed assets from its sponsor pipeline, with logistics development projects in Asia totalling about 51 million sq ft as at Dec 2018.

    They also plan on divesting some assets in Singapore, Japan and South Korea in FY19.

    Nonetheless, Koh is keeping a cautious outlook amid continuing trade tensions and tightening financial conditions.

    Despite this, leasing demand for MLT's portfolio has held steady, supporting rentals and occupancy rates. Management also cited the high tenant retention of about 70-80% as signs of portfolio resilience going forward. They remain vigilant of the evolving environment, and have pro-actively hedged 85% of MLT’s total debt on fixed rates.
     
  10. Amator

    Amator Well-Known Member

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    SINGAPORE (Jan 25): RHB Research is maintaining a “neutral” call on CapitaLand Commercial Trust (CCT) with a target price of $1.86.

    CCT yesterday announced that its 4Q18 DPU has increased by 6.7% to 2.22 cents from 2.08 cents in 4Q17. FY18 DPU was just 0.5% higher at 8.70 cents from 8.66 cents in FY17.

    Gross revenue came in at $99.0 million, a 14.8% increase from $86.3 million last year, mainly due to contributions from Asia Square Tower 2 (AST2) and Gallileo. Net property income came in at $79.3 million, 16.6% higher than $68.0 million a year ago.

    Based on CBRE preliminary data, Grade-A office rents rose 15% y-o-y in 2018 to $10.80 psf.

    In a Friday report, analyst Vijay Nararajan says, “With limited Grade-A supply in the pipeline (c.1.1m sqft), we expect Grade-A rents to rise 5-10% in 2019. The favourable outlook would benefit CCT which has about 15% of leases (as % of rental income) due for renewal this year. With average expiring rents of these leases already 4% below current market rents, we expect a healthy positive reversion of 5-15% for 2019.”

    CCT’s management said that it is considering refurbishing 21 Collyer Quay (21CQ), with a view of re-leasing the entire space. CCT plans for the refurbishment works to achieve a minimum downtime.

    Currently, HSBC is the sole tenant of the building and has extended its lease until April 2020.

    “With office rental expected on an uptrend until 2021, we believe such a move will be favourable to unit holders,” says Natarajan.

    Meanwhile, leasing works are commencing at CapitaSpring, as construction works are on track to complete by 1H21.

    As of now, JP Morgan signed up to be the anchor tenant for office space taking up c.24% of the NLA. Management plans to open a show suite on the site and commence leasing for the remaining space.

    “We see more upside to its targeted yield on cost of 5% if the office rental momentum continues,” adds Natarajan.

    As for mergers and acquisitions, CCT’s management says that it prefers gateway cities in Germany for its sound fundamentals, but it is unlikely that overseas assets will exceed 20% of its portfolio.

    The analyst also reckons that the trust may exercise its call option to acquire the remaining 55% stake in CapitaSpring closer to its completion.

    “Despite a positive outlook, a 1.0 times FY19 P/B valuation and FY19 yield of 5.0% are not compelling in our view so we would recommend investors to buy on dips,” says Natarajan.
     
  11. Amator

    Amator Well-Known Member

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    SINGAPORE (Jan 25): Maybank Kim Eng is upgrading Singapore Airlines to “buy” given its revised earnings forecasts are now above consensus.

    Maybank is raising FY19-21E earnings by 33%, 37% and 17% respectively to factor in lower fuel price, better yield outlook, its latest traffic-growth plans and USD/SGD estimates.

    “Maybank thinks the market has not priced in SIA’s operational resilience and the benefit of a lower fuel-price environment,” says analyst Mohshin Aziz in a Thursday report.

    “Furthermore, we are optimistic its efforts to consolidate operations will yield cost reductions. Its dividend yields of more than 4% are also attractive and above peer average,” adds Aziz.

    To recap, overall traffic -- passenger plus cargo -- in 3Q19 grew 3.9% y-o-y. Load factor receded by 0.3 ppt y-o-y to 76.1%, although this is still considered high by historical comparison.

    Aziz believes management’s strategy to consolidate Silkair into the parent airline is a good move as it creates a clear demarcation between the premium and budget segments.

    This comes as traffic growth momentum is expected to slow going forward due to market maturity and based on management’s latest growth plans.

    Meanwhile, SIA has hedged up to 46% of its fuel needs up to FY23 at reasonable levels (US$57-64/bbl Brent), which provides some cost stability and lowers operating risk.

    “Upgrade to ‘buy’ from ‘hold’ and raise target price 14% to $11.20 as we raise P/B multiple to the historical average of 0.94 from 1SD below due to lower risks to growth,” says Aziz.
     
  12. koaladreaming

    koaladreaming Well-Known Member

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    Good morning all,
    Special thanks to Bro Amator for the corporate results update.
     
  13. Amator

    Amator Well-Known Member

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    A US$41 billion flash crash in Singapore gives traders a fright
    By:
    Bloomberg
    25/01/19, 07:25 am
    SINGAPORE (Jan 25): What was shaping up to be a ho-hum market open in Singapore suddenly became the most dramatic session in years, with a haphazard spree of sell orders causing a US$41 billion ($55.8 billion) crash in the city’s biggest stock.

    Jardine Matheson Holdings Ltd., the flagship investment firm of a 186-year-old conglomerate that hadn’t posted a double-digit stock decline since April 2009, plunged 83% in pre-market trading on Thursday. While the drop reversed almost as quickly as it happened, some 167,500 shares changed hands at prices less than a quarter of the previous day’s close.

    [​IMG]

    Speculation raged across trading desks as to whether an inept human or badly-programmed machine was to blame. Sell orders overwhelmed bids during the pre-open, for which neither a fat finger nor a malfunctioning computer system were responsible, Singapore Exchange Ltd. said in an e-mailed statement after the market closed. There was no evidence of manipulation and trading was orderly, the bourse said.

    Still, if the orders themselves weren’t a mistake, the price reaction almost undoubtedly was. It’s a reminder of how quickly losses can happen in lightning-fast financial markets, exacerbated in this case by the fact that Singapore’s circuit breakers only kick into action when the regular trading session begins. Those who sold at the pre-market price left about US$9 million on the table, according to Bloomberg calculations.

    “The extent of the price plunge was certainly out of the norm, one that had folks questioning if it had really occurred," said Jingyi Pan, a market strategist at IG Asia Pte in Singapore. “The rapid movements unfolding in the early hours of the market open could have enabled this to slip away.”

    Nursing Losses

    Three market makers are nursing losses from selling amid the plunge, while more than a dozen counterparties snapped up the cheaper shares for an instant profit, according to a person with knowledge of the matter, who asked not to be named because they’re not authorized to speak publicly about the matter.

    The exchange isn’t letting the sellers off the hook. They had "ample time" to withdraw their orders if they didn’t want to offload shares at the low price, SGX said after reviewing the incident and deciding not to cancel the trades.

    “Apparently there is lack of protection mechanism during pre-market hours," Margaret Yang, strategist at CMC Markets Singapore Pte. Ltd. said by e-mail. “Lack of liquidity in Jardine Matheson amplified the price movement, and this is a common issue across Singapore’s equity market."

    Jardine is aware that an electronic trading error occurred, Jessie Tsui, a spokesperson for the conglomerate, said by email before the SGX statement.

    The Jardine Matheson group, founded in July 1832 in China and headed by the Keswick family, was one of the “hongs,” or trading houses that shaped the development of Hong Kong for more than a century. After moving its listing from Hong Kong to Singapore, the group has gradually shifted its business toward Southeast Asia. It also has investments elsewhere, including in Rothschild & Co.

    The conglomerate’s units operate a wide range of businesses ranging from running Pizza Hut restaurants in Asia to hotels and Mercedes-Benz dealerships in the region. The group, also known as Jardines, generated more than US$83 billion in revenue and US$1.57 billion in underlying profit in 2017, according to its website.

    The group, boasting more than US$82 billion in assets, is the biggest landlord in Hong Kong’s Central District, the world’s most expensive office market, where its holdings include the Mandarin Oriental Hotel. It also owns the Excelsior hotel on Lot No. 1, the first land auctioned in Hong Kong in 1841
     
  14. nottibird

    nottibird Moderator

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  15. Amator

    Amator Well-Known Member

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    SINGAPORE: No "fat finger" error was involved when the share price of conglomerate Jardine Matheson Holdings plunged briefly on Thursday (Jan 24), wiping out US$41 billion in market value, Singapore's stock market regulator said.

    Traders had speculated that the stunning 83 per cent tumble could have been caused by a keyboard mistake in which a finger hits two keys simultaneously, noting the stock's quick rebound.

    But the Singapore Exchange (SGX) said its regulatory body had reviewed the transactions and found no basis to cancel the trades.

    The plunge came after sell orders overwhelmed bids before the opening session, it said in an emailed statement.

    "Trading was orderly and there was no sign of manipulation," SGX said.

    "We have also ascertained that the orders were not due to fat finger errors or any malfunctioning systems on the part of the participants."

    On Thursday, Jardine Matheson shares tanked just before regular trading opened, with 167,500 shares changing hands at US$10.99, down sharply from Wednesday's close of US$66.47.

    The shares quickly rebounded, however, and the losses were recouped as Jardine Matheson ended the day 0.53 percent higher at US$66.82.

    "Obviously, it looks like a fat finger trade and the seller is bound to have informed the exchange and requested it to cancel the trade. Given the huge price difference, normally such trades are cancelled," said one local trader before SGX released its findings.

    Jardine Matheson also said it believed the decline was caused by an "an electronic trading error", before the SGX statement was released.

    The Jardine group has businesses in a wide range of sectors, including motor vehicles, luxury hotels, property development, financial services and food retailing.

    Fat finger blunders involving billions of dollars are not new in the market.

    Bloomberg reported in April 2018 that German lender Deutsche Bank accidentally transferred €28 billion (US$35 billion) to one of its outside accounts.

    In October 2014 hundreds of billions of dollars worth of stock orders in some of Japan's biggest firms had to be cancelled, possibly the result of a "fat finger" error.
     
  16. Amator

    Amator Well-Known Member

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    SINGAPORE (Jan 24): Keppel Corporation reported earnings of $135 million for 4Q18 ended Dec 2018, compared to a net loss of $492 million for 4Q17.

    Excluding the one-off financial penalty and related costs of $619 million arising from Keppel O&M’s global resolution with criminal authorities in 4Q17, earnings for 4Q18 of $135 million was 6% above the earnings of $127 million for 4Q17.

    FY18 earnings came in at $944 million, nearly five times higher compared to the earnings of $196 million for FY17. Excluding the one-off financial penalty and related costs, FY18 earnings of $944 million would have been just 16% higher year-on-year.

    Group revenue for 4Q18 came in at $1.68 billion, 9% above that of 4Q17.

    Revenue from the offshore & marine division increased by $30 million to $520 million due mainly to higher revenue recognition from ongoing projects.

    Revenue from the property division decreased by $59 million to $373 million due mainly to lower revenue from Singapore, partly offset by higher revenue from Vietnam and China.

    Revenue from the infrastructure division increased by $151 million to $744 million due mainly to increased sales in the power and gas businesses as well as higher progressive revenue recognition from the Keppel Marina East Desalination Plant project.

    In 4Q18, the offshore & marine division suffered a pre-tax loss of $97 million. Pre-tax profit of the property division of $215 million was 40% lower than 4Q17 due mainly to lower fair value gains on investment properties. Investments division’s pre-tax loss was $4 million.

    In its outlook, Keppel says the offshore & marine division will continue to focus on delivering its projects well, exploring new markets and opportunities, investing in R&D and building new capabilities. Net order book, excluding the Sete rigs, stood at $4.3 billion as at end Dec 2018.

    In 4Q18, the property division sold about 4,440 homes in 2018, comprising about 160 in Singapore, 2,240 in China, 910 in Vietnam, 350 in Indonesia and 780 in India.

    The division says it will remain focused on strengthening its presence in its key markets such as Singapore, China and Vietnam and scaling up in other markets such as Indonesia and India, while seeking opportunities to unlock value and recycle capital.

    Keppel has proposed a final cash dividend of 15.0 cents/share which will bring total cash distribution to 30.0 cents/share for FY18.
     
  17. Amator

    Amator Well-Known Member

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    SINGAPORE (Jan 24): Singapore Exchange reported 2Q earnings of $97 million, or 9 cents per share, 9% higher compared to a year ago.

    The board has declared an interim dividend of 7.5 cents per share, up from 5 cents last year.

    Total revenue for 2Q also rose 9% to $224 million from a year earlier.

    Revenue from derivatives increased 35% to $112.9 million and accounted for half of total revenue.

    Revenue from equities and fixed income – comprising issuer services, securities trading & clearing and post trade services – declined 12% to $85.6 million, accounting for 38% of total revenue.

    Revenue from issuer services revenue decreased 7% to $19.0 million, contributing to 8% of total revenue.

    Revenue from securities trading and clearing revenue decreased 13% to $45.2 million and accounted for 20% of total revenue.

    Revenue from post trade services revenue declined 16% to $21.4 million, accounting for 10% of total revenue.

    In 2Q, securities daily average traded value (SDAV) declined 14% to $0.98 billion, with total traded value dipping 12% to $62.7 billion. This was made up of equities where traded value decreased by 14% to $57.2 billion, and other products where traded value increased 7% to $5.5 billion.

    Expenses increased by 8% to $110.5 million, mainly due to higher staff costs and professional fees. Technology expenses was unchanged at $31.6 million.

    Loh Boon Chye, CEO of SGX, says, “We achieved a second consecutive quarter of record performance in our derivatives business, with robust institutional demand for our risk management and hedging tools, including our MSCI Net Total Return index futures and FX futures contracts.”

    However, Loh says investor sentiment was dampened by concerns on slower global economic growth and escalating trade tensions, which led to lower activity in its securities business along with other regional markets.

    For the second half of FY2019, Loh expects investors to actively seek risk management solutions and investment opportunities, amid persistent global geopolitical and market uncertainties.
     
  18. Amator

    Amator Well-Known Member

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    Keppel nets profit of S$944 million for FY 2018, up 382% yoy
    Proposed final cash dividend of 15.0 cts/share will bring total cash distribution to
    30.0 cts/share for FY 2018.

    Singapore, 24 January 2019 – Keppel Corporation Limited (Keppel) reported a net profit
    of S$944 million for the 12 months ended 31 December 2018. This was 382% higher than
    the S$196 million net profit for FY 2017, which included the S$619 million one-off financial
    penalty and related costs arising from Keppel O&M’s global resolution with criminal
    authorities in the United States, Brazil and Singapore.

    The Group’s FY 2018 net profit of S$944 million would have been 16% higher year on
    year, excluding the one-off financial penalty and related costs in FY 2017. Earnings
    growth for the period was underpinned by stronger performance from across the Offshore
    & Marine, Property and Infrastructure divisions.

    upload_2019-1-24_17-38-42.png
     
  19. Amator

    Amator Well-Known Member

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    SGX reports 2Q FY2019 net profit of S$97 million

    2Q FY2019 Financial Summary
     Revenue: S$224 million, up 9% from a year earlier
     Operating profit: S$114 million, up 10%
     Net profit: S$97 million, up 9%
     Earnings per share: 9.0 cents, up 9%
     Interim dividend per share: 7.5 cents, up by 2.5 cents

    upload_2019-1-24_17-35-15.png
     
  20. Amator

    Amator Well-Known Member

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    SINGAPORE (Jan 24): Analysts believe Suntec REIT could see better days ahead with retail continuing to improve and office rents expected to be on a multi-year upturn.

    “Since early 2018, more sell-side analysts have joined us in being bullish on Suntec,” DBS Group Research lead analyst Mervin Song says in a report on Thursday.

    “As there is mounting evidence of a sustained turnaround at Suntec City Mall, spot office rents at an upward trajectory and underlying DPU to improve by 3-4% per annum between 2018 and 2021, we believe more investors and other sell-side analysts will be convinced that Suntec is undervalued,” he adds.

    DBS is keeping its “buy” call on Suntec REIT with an unchanged street-high target price of $2.12.

    The latest report comes after the manager of Suntec REIT on Wednesday posted distribution per unit (DPU) of 2.59 cents for 4Q18, some 0.5% lower than DPU of 2.60 cents a year ago.

    Gross revenue increased by 7.0% to $93.5 million, mainly due to higher revenue contribution from Suntec City mall, its convention centre business and 177 Pacific Highway.

    Net property income (NPI) rose by a smaller 2.3%, due to the $4.8 million sinking fund contribution for Suntec City office.

    “We believe as Suntec remixes its tenant mix and picks the low-hanging fruits such as placing children stores next to the playground rather than at opposite ends of the mall, the resultant higher foot traffic, tenant sales and improving rents should act as re-rating catalysts,” Song says.

    However, Jefferies analyst Krishna Guha notes that Suntec REIT’s gearing is relatively high at 38.1%, and cautions that its expansion in Australia might be at an elevated valuation.

    “Expansion in Australia is source of diversification but may have come at peak of cycle especially with two broad sectors, banks and commodities, experiencing headwinds,” Guha says in a report on Wednesday.

    Jefferies is keeping its “hold” recommendation on Suntec REIT, but raising its target price to $1.85, from $1.80 previously.

    The higher target price comes as the research house tweaks its DPU estimates for FY19 and FY20 up by 0.6% and 1.3%, respective. This is mainly due to higher expected rental reversion, higher top ups, and increased contribution to joint venture income from Southgate Complex, 9 Penang Road and 477 Collins Street.

    “While Suntec City mall is delivering good results, we think Suntec office may take a while to revert to the 2017 quarterly average NPI of $27 million,” Guha says.

    The way RHB Research analyst Vijay Natarajan sees it, Suntec REIT has been actively redeveloping and revamping its assets, but effects are likely seen only from 2H20 onwards.

    “The strong rebound in office rental rates and repositioning of the retail mall has benefitted the REIT, with Suntec City Office and retail seeing positive rentals reversions of 10% and 3% for 2018,” Natarajan says.

    RHB is keeping its “neutral” rating on Suntec REIT with an unchanged target price of $1.90.

    Looking ahead, Natarajan believes Suntec REIT might look to acquisition opportunities to bolster operational DPU.

    “We believe the REIT might potentially look at acquiring the remaining 50% stakes in Olderfleet and Southgate Complex in the near term. With gearing at 38.1%, we see limited debt headroom, and future acquisitions are likely to be a combination of equity and debt,” he adds.

    As at 2.52pm, units in Suntec REIT are trading 3 cents higher, or up 1.6%, at $1.90. Accrding to DBS valuations, this implies an estimated price-to-earnings ratio of 31.1 times and a distribution yield of 5.3% for FY19.
     
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