SINGAPORE (June 24): Henry Tay, executive chairman of The Hour Glass, has transferred 25 million shares to his son, managing director Michael Tay. According to a June 18 filing with the Singapore Exchange, the transfer took place on June 14. Based on June 14’s closing price of 77 cents, Michael’s net worth has increased by $19.25 million.
The transfer of shares took place less than a month after the company announced record earnings of $71.4 million for FY2019 ended March 31, 41% higher than the $50.7 million in the previous year.
Revenue in the same period was up 4% y-o-y to $720.9 million. The company attributes the record earnings to its meeting the needs of a new generation of customers and ongoing operational efficiencies. In the company’s earnings announcement on May 28, Michael said the group began a journey to transform itself three years ago and that the efforts are continuing to bear fruit. “We have remained steadfast in our goal to tighten coordination and improve our operational effectiveness and this is reflected in our overall performance. In tandem, initiatives to tailor services to meet the needs of an increasingly sophisticated market are yielding returns,” he added.
In line with record earnings, The Hour Glass is proposing to pay a dividend of three cents a share for FY2019, up from two cents a share in the preceding year.
Following the transfer of the 25 million shares, Tay now owns 64.9 million shares directly, down from 89.9 million previously.
Besides these directly held shares, Tay has a deemed interest in the company of 378 million shares, which remain unchanged. Those shares are held via entities called TYC Investment, Amstay and AMS Lifestyle.
Tay’s stake in the company now stands at 62.8%, down from 66.4%. As for Michael, he now owns 26.8 million shares in total, which represent a stake of 3.8% in the company.
In April, Tay made the rare move of buying back shares in The Hour Glass. He bought a total of 10.22 million shares — half a million on April 3 at 67 cents a share and 9.72 million on April 15 at 71 cents a share.
The Hour Glass is one of many watch retailers that have enjoyed a good run since the start of the year, as the industry is experiencing steady growth.
The share price of another SGX-listed watch retailer, Cortina Holdings, has similarly soared, from 95 cents at the start of the year to $1.50 as at June 19. The group’s full-year earnings for the year ended March 31, 2019 showed a 1% y-o-y drop in revenue, but profit attributable to shareholders increased 31% y-o-y to $29.2 million, as Cortina was able to sell at a higher margin.
The Hour Glass, however, warned that prospective shifts in global geopolitics and economics “cast concerns over the positivity of consumer sentiment among watch buyers”. But barring any unforeseen circumstances, it expects to be profitable for the next financial year.
The Hour Glass runs more than 40 boutiques in nine cities across Asia, including Hong Kong and Bangkok. The company celebrates its 40th anniversary this year.