Tuesday, October 20, 2015

Little Infor - Bonia

It is an investment holding company, which engages in the market retail and distribution of leatherwear footwear men's apparel and accessories.

It operates through the following segments: Retailing, Manufacturing, and Investment & Property Development.

The Retailing segment designs, promotes and markets apparels footwear accessories and leather goods. The Manufacturing segment engages in the manufacture and market of leather goods. The Investment & Property Development segment consists of investment holding and rental and development of commercial properties.

Other than expanding its own in house brands, the group has also been aggressively expanding its co owned brand … Braun Buffel.

In Sept 2015 Bonia’s subsidiaries BB Global Holdings Pte Ltd (BBGH) acquired intellectual property rights from Braum GmbH & Co KG (BBKG) in a deal worth EUR1.88 million (equivalent to RM9.21 million)

The clothing manufacturer reported a net profit of RM5.41 million or 0.67 sen a share for the fourth quarter financial year ended June 30, 2015 (4QFY15), a 39.3% drop from RM8.92 million or 1.11 sen a share a year ago.

Revenue for the period also dipped slightly to RM148.3 million, from RM165.86 million in 4QFY14.

To recap it had proposed one for one bonus issue and two for one share split went ex on July 21 2014. Both exercises will increase its outstanding number of shares.

Key risks for Bonia will be a regional slowdown in consumer spending and stiffer than expected competition.

As at 2014 institutional shareholdings in Bonia stand at 40% compared with an estimated 15% to 20%. For instance, Milingtonia Ltd holds a 11.2% stake in the group. Milingtonia is said to be linked with Creador Group, a long-term private equity firm. Albizia Capital Pte Ltd holds a 7.96% stake in the company.

The institutional shareholdings in Bonia are also more diverse compared with several years ago, considering that Permodalan Nasional Bhd (PNB) once held a dominant 32.99% stake in the retail group in June 2011. PNB has ceased to be a shareholder of Bonia, having divested its stake gradually to other institutional funds including Creador.

The group is open to strategic partnerships that can propel it further, beyond...Southeast Asia, such as China or even the Middle East eventually.

The Chiang family, through Bonia Holdings Sdn Bhd, Freeway Team Sdn Bhd, and family members, collectively own half of the group. Should the group find a suitable partner, the family may have to divest part of its stake.

Wednesday, October 14, 2015

Just Read ... Minho (Revaluation Play, Beneficiary From Strong USD)

It is established dated back to before the year 1977, when it started of as Syarikat Minho Kilning Sdn Bhd, providing klin drying services. To date (Aug 2015), the company had grown up into a fully integrated timber player, providing services such as ...

- Klin Drying and Chemical Preservative treatment;
- Manufacturing, exporting and dealing in moulded timber and it's related product;
- Export of processed timber products;
- Manufacturing and distribution of industrial paper bags;
- Trading in log supply and it's related products;
- Log harvesting;
- Property development and building construction;
- Manufacturing and dealing in furniture components and it's related product;
- Land leasing

However, with all the diversified services and product, Minho still derived it's major revenue from the timber trading and manufacturing of processed timber goods.

With the current (Aug 2015) local market outlook on massive completion of housing projects that will be handling over in 2015 to 2017, and the international market outlook with a stronger USD and the on going European Stimulus program, where can it leads to for Minho from Aug 2015?

While 2014 had been a challenging year, however, Minho still managed to scrap through the year with a total revenue of RM 238 million.

Minho business which deal in timber is very cyclical in nature. Various market factor and changing weather can easily put a blow into the financial result. However, Minho's experience in the timber sector definitely did pay out when the group grab hold of the opportunity in diversifying into land banking and subsequently into small property development.

Till date (Aug 2015), Minho is greatly boosted with a strong underlying asset of freehold land. Most of it's land is still clinging on the valuation dated back to 2009 and 2010. Minho currently (Aug 2015) is sitting on NTA of RM 2.93. However, there are still a good number of revaluation reserved in their belt of freehold land in prime commercial area of Klang, which is near to Port Klang.

Minho had been also paring down it's debt level gradually.

While most of the revenue came from the local market, revenue from the US is ranked no.2 while UK no.3. The US market will continue to remain stable, while Minho can start to tap into the European market with the current (Aug 2015) stimulus program.

A stronger USD against the MYR will also translate to a better forex gain for the group. A stronger contribution from the European market will be able to see Minho ending in a stronger bottom line in 2015.

Minho is an interesting company to be look out upon, largely due to it's strong underlying assets, with NTA bearing approx RM 3.00.


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Please note that all data given are merely blogger's opinion. It is strongly recommended that you do your own analysis and research before investing.