Jumbo Group, the operator of a chain of F&B outlets ranging from high-end seafood restaurants to stalls in coffee shops, has been buying back its shares steadily.
On Aug 22, Jumbo bought back shares for the first time under the current mandate, acquiring 34,500 shares for 26.5 cents each. Last month, the company stepped up its buyback programme despite higher share prices. For example, Jumbo acquired 125,000 shares and 50,100 shares on Dec 28 and 30 respectively, both at 30 cents.
Most recently on Jan 3, Jumbo also bought back 100 shares at 30 cents each amid low trading volume. This brings the total number of shares bought back under the current mandate to 500,200 units or 0.0779% of the total.
Jumbo, which has a presence in Singapore and various regional markets, recently returned to profitability, following two preceding loss-making years as consumers shunned al fresco dining during the pandemic. A significant chunk of Jumbo’s business also comes from tourists eager to try its signature chilli crab dish.
On Nov 29, Jumbo reported earnings of $4.4 million in 2HFY2022 ended Sept 2022, versus a loss of $6.9 million a year earlier. The company says its Singapore operations, as at 4QFY2022 ended Sept, have recovered to levels almost on par with pre-Covid levels.
In their Dec 13 note, CGS-CIMB analysts Kenneth Tan and Ong Khang Chuen expect Jumbo to report full-year FY2023 earnings of $8.6 million versus a loss of $0.1 million in FY2022 as business recovers from the gradual return of tourists from North Asia. New outlets will start to contribute as well. “We believe Jumbo appears set for a steady recovery in FY23F,” the analysts write.
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“While we see the possibility of further downtrading as consumers exercise financial prudency, we believe the impact should be cushioned by the return of tourists and resilient restaurant spending from middle-upper income consumers,” the analysts note. They have kept their “add” call on the stock but raised their target price from 30 cents to 35 cents.
In line with the recovery, Jumbo has resumed its expansion plans. On Dec 22, Jumbo reported the official opening of its first franchised Jumbo Seafood outlet in Phnom Penh, the capital of Cambodia.
“The Jumbo Seafood brand remains strong and resilience despite the Covid-19 pandemic,” says group CEO and executive director Ang Kiam Meng. “Even though we now have 22 Jumbo Seafood outlets in 12 cities in Asia, we will continue to work towards increasing the Jumbo Seafood footprint and bringing the Singapore chilli crab experience to more cities.”
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A rare occurence
Thakral Corp, which is in property and the business of distributing consumer goods, has recently started its share buyback programme — a corporate action the company is not synonymous with.
Thakral’s first buyback was made on Dec 16, 2022, when it acquired 350,400 shares at between 50 and 51 cents each. Since then, Thakral has continued its buyback with its share price gaining about 10 cents. Thakral’s most recent buyback was conducted on Jan 4 when it acquired 290,000 shares at between 61 cents and 62 cents each. This brings the total number of shares bought back under the current mandate to 1.63 million.
Earlier on Dec 30, it had acquired 311,700 shares at between 59 cents and 61 cents each. It also bought back 100,000 shares at 57 cents each on Dec 27, 112,400 shares at 58 cents each on Dec 28, and 120,900 shares at between 59 cents and 59.5 cents each on Dec 29.
As at June 30, 2022, Thakral’s net asset value per share was 109.26 cents versus 115.53 cents as at December 31, 2021. The company attributes the dip to the impact of the translation loss of investments and net assets of certain overseas businesses denominated in the Japanese yen and Australian dollar, both of which have weakened against the Singdollar, its reporting currency.