Swiber - Judicial Management

The Board of Directors (the “Board”) of Swiber Holdings Limited (the “Company”) refers to its earlier announcement dated 27 July 2016, regarding the appointment of Mr Cameron Lindsay Duncan and Ms Muk Siew Peng, care of KordaMentha Pte Ltd, as the joint and several Provisional Liquidators of the Company (“Provisional Liquidators”).

On 28 July 2016, the Board of Directors and the Provisional Liquidators have had discussions with the Company’s major financial creditor who indicated that they are supportive of an application for the Company to place itself into judicial management instead of liquidation. 

Today, the Company and its subsidiary, Swiber Offshore Construction Pte Ltd (“SOC”), have taken out applications to place the Company and SOC under judicial management and interim judicial management. As a consequence, the Company has applied to discharge the provisional liquidation order and to withdraw the winding up application made on 27 July 2016.  

StarHillGlobal Reit 4QFY15/16

Revenue                                   $53.6m
NPI                                           $41.4m
Income Available For Dist       $28.4m
DPU                                          1.29 cents
Total Debt                                 $1,127m
Gearing                                     35.0%
Interest Cover                           4.3X
Average Interest Rate               3.09%
Unencumbered Asset Ratio      73%
NAV                                          92 cents

CDL Hospitality Trust 2QF16

NPI                                               $31.4m
Income Available For Dist           $22.1m
DPU                                              2.23 cents (1HFY16 4.45cents)
Occupancy                                     83.5%
ARR                                              $188
RevPAR                                        $157
Total Assets                                   $2,53m
Debt                                               $919m
Gearing                                          35.3%
Interest Cover                                 5.8X
Avg Weighted Cost Of Debt          2.4%
NAV                                               $1.5526

CRCT 2QFY16

Gross Revenue                                            RMB 246,737,000
NPI                                                              RMB 169,937,000
NPI                                                              $ 35,501,000
Distributable Income                                   $ 23,374,000
DPU                                                             2.61 cents (2.73 cents for 2QFY15)
NAV (adjusted for dist)                               $ 1.55
Gearing                                                        29.2%
Interest Cover                                              6.4X
Avg Cost Of Debt                                        2.97%
Unencumbered Assets                                 97.5%
Net Debt/EBITDA                                       5.3X

MapleLogistics Trust 1QFY16/17

Revenue                                     = $89,562K
NPI                                            = $75,198K
Amount Distributable to Shrs   = $46,037K
DPU                                          = 1.85 cents
Total Debt                                  - $1,868m (exclude $250m perpetual securities issue in May)
NAV                                          = $1
Weighed Avg Interest rate        = 2.3%
Avg leverage ratio                     = 35.9% (decrease due to issue of perpetual securities)
Avg debt duration                      = 3.6 years
Interest Cover                            = 5.6X

AscendasIndia Trust 1QFY16/17

Total Property Income                          =  Rupee 1,776m
NPI                                                        =  Rupee 1,164m
Income Available For Dist                   =  $14.0m
DPU                                                      =  1.36 cents (1QFY2016/2017 1.37 cents)
NAV                                                      = 65 cents
Interest Cover                                         = 3.6
Gearing                                                   = 29%
Percentage Fixed Rate Debt                   = 100%
Average Cost Of Debt                            = 7.1%
Effective Borrowings                             = $397m (INR:75%,SGD:25%)

INR:SGD (49.3:1)

SuntecReit 2QFY16

Gross Revenue                                 = $78.9m
NPI                                                   = $52.7m
Distributable Income                        = $63.3m  ($8m from capital)
DPU                                                  = 2.501 cents
Total Debt Outstanding                    = $3041m
Gearing                                             = 34.7%
All-In-Financing-Cost                      = 2.77%
Interest Coverage Ratio                    = 3.6X
Adjusted NAV                                  = $2.101

SATS 1QFY16/17

Revenue                                  $424.2m
(Food Solution                        $240m
 Gateway Services                  $184.9m
 Corporate                               $1.3m)

Operating Profit                      $54.5m
Share Of Associates               $12.2m
Profit Attributable to Shrs       $64.1m
Underlying Profit                    $55.5m
EPS                                         5.8cents
NAV                                        $1.4
Debt/Equity Ratio                    0.08

Ascott Reit 2QFY16

Revenue                                    $119.4m
Gross Profit                               $57.9m
Unitholders Distribution            $35m
DPU                                          2.13 cents
RevPAU                                    $142
Gearing                                      41%
Interest Cover                            4.1X
Effective Interest rate                2.5%
Percentage Of Fixed Debts        80%
NAV                                           $1.32
Weighted Avg Debt to Maturity 4.9 years

Ascott Reit is my latest addition. I like it for its diversified portfolio in 38 cities within 14 countries with 90plus properties (11K plus apartments).

KReit 2QFY16

Property Income                    $40.6m
NPI                                        $32.5m
Shr of Associates                  $20.1m
Shr of JV                               $8.3m
Income Available for Dist    $52.5m
DPU                                      1.61 cents
NAV                                     $1.41
Gearing                                 39%
Interest Coverage Ratio        4.6
All-in Interest rate                 2.55%

Keppel Infra Trust 2QFY16

DPU                                0.93 cents
Distributable CF             $38m (City Gas - $12.1m, KMC - $11.2m, Concessions - $17.4m, Others - ($2.6m) )
NAV                               32.4 cents
Gearing                           36%    (25% without Basslink)

Total Assets                    $4,061m
Total Liabilities              $2,596m
Total Borrowings           $1,706m ($1007m without Basslink)
Net Debt                         $1,455m ($799m without Basslink)
Cash                                $251m
Net Debt/EBITDA          6.1X (3.8X without Basslink)

Basslink loans are non-recourse and currently Basslink CF are used to pay down debt and not for DPU. As a result of an outage earlier this year, currently the borrower is unable to meet the interest coverage ratio under the agreed Project Financing.Thus, as a condition of the waiver given under this default event, the borrower is  obliged to agree with the Financiers on a Long Tem Financing Plan  to be announced at a later date.

South China Sea Dispute Snapshot

SPH Q3FY2016

Operating Revenue                    $291,579K
Operating Profit                         $60,770K
Investment Income                    $18,672K
Profit After Taxation                 $61,980K
Net Profit Attr To Shrs              $52,656K
EPS                                            3 cents
NAV                                           $2.11
Cash & Cash Equiv                    $278,460K

Comment: Results of Q3FY2016 impacted by impairment of goodwill and intangibles amounting to $28.4m for the magazines business due to unfavourable business conditions.Excluding impairment charges, operating profit would have fallen by $17.1m.

FirstReit 2QFY2016

Revenue                             = $26.6m
NPI                                    = $26.3m
Distributable Income         = $16.2m
DPU                                   = 2.11 cents (2QFY2015 2.07 cents)
Total Debt                          = $456.7m
Gearing                               = 34.4%
NAV                                   = 103.12 cents

Remarks.In the press release, it stated that the issue of $60m subordinated perpetual securities at a fixed distribution rate of  5.68% for the first 5 years will reduce gearing from 34% to 30% as the proceeds will be used to reduce debt and increase debt headroom for further acquisition. I find this sort of statement misleading as perpetual securities are still considered as a form of debt, in my view.Definitely, a gearing of 30% without any perpetual securities is quite different from a gearing of 30% with $60m perpetual securities. I believe FirstReit is not the only REIT that is doing this, a number of reits have raise perpetual securities to get around borrowing from banks.

Currently, the manager hold about 5.67% of the total number of units issued. Each quarter, 70% of the management fee is paid with units and the remainder 30% paid with cash.

SoilBuild Trust 2QFY16

Gross Revenue                                                = $19,570K

NPI                                                                  = $17,325K
Distributable Income                                       = $14,727K
DPU                                                                 = 1.565 cents
NAV                                                                 = 79 cents
Leverage                                                          = 35.9%
Average All-In Interest Ratio                           = 3.44%
Interest Cover                                                  = 5X
Weighted Avg Debt Maturity                           = 3.4 years
WALE                                                              = 4.6
Secured Leverage                                             = 15%
Occupancy                                                        = 92%

Olam

Observed recently that Olam has buy back close 20m of its own shares over the last 2-3 months.That is a whopping $36m worth of purchase in cash (assume a price of $1.8/shr).Since Olam already as a small float of less than 20% after the buyback initiated by Temasek a while ago, I wonder why they are doing this? Is it because some major shareholders is/are unloading?or it is something else?I doubt it is the minority shareholders that is unloading because they did not let go at $2.2 (from the Temasek offer) a while ago.

Remember, a while ago, Temasek sold 20% of their shareholding to Mitsubishi Lifestyle at $2.7 apiece.Right now, the two largest shareholders are Temasek and Mitsubishi. This is followed by the Kewalram family, CEO and its senior management staff.

I am still vested with Olam and will follow on this with interest. The positive thing about Olam right now is that they have prune away a substantial part of the unprofitable business and interest rate on debts have come down with Temasek backing.

CMPH & SilverLake Axis

I have recently received the cash  for the unconditional GO offer at $1.02/shr for a total of 21550 shares.It was  a good investment for me at I purchased at an average price of around 60 cents/shr excluding dividends. All in all, I held these shares for an average period of 5 years.I stumbled upon CMPH by chance 5 years ago after reading some comments from some forumers.

I have since then reinvested the amount into Silverlake Axis at an average price of 49.5 cents/shr.Why SilverLake Axis? when there are some attacks on its corporate practice relating RPT last year. Firstly, I think the business is still sound and price has come down to more realistic levels.The company do not carry a lot of debt and the business itself has a reasonably good moat for the time being unless fintech take on in  a very big way displacing traditional banks which I doubt.There is some upside as the company hold 27m shares in GIT which is listed in the Shenzhen stock exchange. GIT currently trade around 70 rmb/shr. Silverlake is entitled to sell 8m GIT shares from 24 June 16 onwards. Silverlake do give regular dividends and the value of ringgit is unlikely to depreciate sharply against the $S from the current ratio of 3:1.Lastly, the company has been doing a lot of buybacks which at least indicate to me that the management is willing to spent cash on its own shares in a big way.

The P/B ratio of around 7 doesn't look attractive but I think I prefer to look at its earning generative ability also. Commodities companies can carry a lot of assets but if these assets cannot generate regular earnings, they will depreciate and be written away pretty fast.Just look at Oceanus to see how pitiful things can get.I was lucky to exit it years ago from this speculative foray with a small loss after I noticed the PRC CEO did not even bother to turn up for the AGM but keep selling his shares in the market.