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Oxley Holdings and First Resources in active share buybacks

The Edge Singapore
The Edge Singapore9/15/2022 01:17 PM GMT+08  • 3 min read
Oxley Holdings and First Resources in active share buybacks
Oxley Towers along Robinson Road, where Oxley Holdings’ head office is sited / Photo: Samuel Isaac Chua
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Developer Oxley Holdings has actively been buying back its own shares. The most recent was on Sept 14, when it acquired 70,000 shares at between 15.9 cents and 16.1 cents each on the open market.

This brings the total number bought back under the current mandate to 6.47 million shares. Oxley was buying back shares too for most of September and from August 23, two trading days after it had announced its most recent full-year results.

On Aug 19, Oxley reported earnings of $3.2 million for the FY2022 ended June, 75% y-o-y lower than the $13.1 million reported a year ago. The company booked gains from the revaluation of some of its assets in Singapore but it had to book an impairment for its project in Cambodia.

Revenue for the year was down 32% y-o-y to $925.9 million mainly due to lower revenue contribution from the overseas projects in Cambodia, the UK, Ireland and Malaysia. This was partly offset by higher revenue from the development projects in Singapore and the sale of land parcels in Australia.

On Sept 8, Oxley announced plans to give out the shares it holds in Malaysian developer Aspen (Group) Holdings to its own shareholders as a form of dividend in specie. As at Sept 8, Oxley held some 101.34 million Aspen shares, equivalent to 9.4% stake in the company, which is in the property business in Malaysia.

Under terms of the proposed distribution, Oxley shareholders will receive 23 Aspen shares for each 1,000 Oxley shares they have.

See also: Japan Foods embarks on share buybacks; Best World resumes trading and buybacks

Oxley took a substantial stake in Aspen back in April 2018 after it subscribed for 97 million shares at 24 cents each. Aspen shares closed at 4.9 cents on Sept 8, the date of the announcement. The stock is down 55.45% ytd.

According to Oxley, the distribution can help unlock “shareholder value” by enabling shareholders to individually and directly participate in the ownership of securities held in two separately listed entities without any additional cash outlay under “individual investment objectives”.

On Aug 26, the Singapore Exchange issued Aspen a public reprimand for breaching listing rules in the botched disclosure of its dealings with Honeywell International, which was in talks with Aspen to buy rubber gloves from its new joint venture.

See also: StarHub, Singapore Exchange in steady share buybacks

Just a day earlier on Aug 25, Ching Chiat Kwong, Oxley’s executive chairman, resigned from his post as non-independent, non-executive director of Aspen, saying he is “unable to allocate sufficient time and resources” to his duties at Aspen.

Palm oil boom

Indonesia-based palm oil company First Resources has been steadily buying back shares too, following its recent interim earnings announcement that showed much improved numbers.

The most recent buyback was on Sept 9, when the company acquired one million shares on the open market between $1.44 and $1.46. This brings the total number of shares bought under the current mandate to 2.93 million. The company was actively buying on most days in September, at between $1.46 and $1.5 each.

In contrast, US fund manager Fidelity has cut its stake in the company. On July 13, Fidelity sold 448,000 shares at about $1.45 each. From just over 79 million shares or 5.01%, Fidelity’s stake has been reduced to 78.6 million or 4.98%.

On Aug 12, First Resources reported earnings of US$128 million ($178.47 million) for 1HFY2022 ended June, up 293.1% y-o-y from US$32.6 million in 1HFY2021. Revenue in the same period was up 29.6% y-o-y to US$535.2 million, thanks to higher selling prices. The company has declared an interim dividend of 2.5 cents per share, double that paid out this time last year.

“With palm oil’s attractive relative pricing against other competing edible oils encouraging replenishment of inventories by importing countries, we believe palm oil consumption demand should remain supportive,” says Ciliandra Fangiono, CEO of First Resources.

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