Yeo Hiap Seng stays focus on expansion, rejuvenation of F&B business

Yeo Hiap Seng stays focus on expansion, rejuvenation of F&B business

By: 
PC Lee
24/09/18, 11:57 am

SINGAPORE (Sept 24): Founded in 1900, Yeo Hiap Seng has grown from a soy sauce manufacturer to the Asia food and beverage (F&B) player it is today.

YHS is well known for its brand of Asian beverages like soybean drink and chrysanthemum tea and canned food products including chicken curry and sardines and baked beans.

YHS also exports to the US and Europe. In 2003, YHS unveiled a new range of “Y-Generation” drinks with creative flavours, packaging and logo to target younger consumers.

Since FY14, YHS has focused on expanding and rejuvenating its core consumer F&B business.

In FY17, company sold its investment in delisted Super Group. In March, YHS entered into a joint venture with HK-listed China Huiyuan Juice Group to develop, manufacture, sell and distribute fruit and vegetable juices targeting the Malaysian market.

In 1H18, YHS’s revenue rose 8.8% y-o-y, while net profit increased 42.3% y-o-y boosted by a $2.9 million gain from the sale of property, plant and equipment and $3.6 million in fair value gains on financial assets.

Although YHS enjoyed y-o-y higher sales in Malaysia, Singapore, Cambodia and China, gross margin was flattish y-o-y at 32.5%. No interim dividend was declared.

In a recent unrated report, CGS-CIMB Securities’ analyst William Tng says for the next 12 months, YHS expects F&B profit margins to remain under pressure from the weak consumption outlook for the markets that the group operates in.

And although the company expects its selling prices to stay competitive, Tng says likely fluctuations in raw material prices and foreign exchange rates could have negative impact on the group’s earnings in the near future.

Still. YHS plans to continue investing in rejuvenating its brand and launch new products, develop its agency business and improve operating efficiencies, says Tng.

YHS trades at a 3.7 times FY17 earnings, 0.86 times book value against 23.4% ROE.

In the past five years, YHS has been in a net cash position. At end June, YHS had net cash of $278 million or 49% of its market cap as at Sept 20.

Although it does not have an official dividend policy, YHS has paid dividends in the past five years.

Year to date, shares in YHS are down 18.7% to $1.00.

Sanli posts 28% drop in FY19 earnings to $2.2 mil on lower revenue; declares 0.25 cent final dividend

SINGAPORE (May 23): Environmental engineering company Sanli Environmental saw its full year earnings fall 27.7% to $2.2 million for the FY19 ended March, from $3.1 million a year ago. Earnings per share (EPS) fell to 0.83 cents for FY19, compared to 1.19 cents for FY18. FY19 revenue slipped 5.6% to $71.4 million, from $75.6 million a year ago. The decline was mainly attributed to the decrease in contribution from the group’s Operations and Maintenance segment, which saw turnover decrease by 30.6% due to increased competition. Gross profit dropped to $9.8 million for FY19, some 10....
Read More >>

Singapore Shipping Corp FY19 earnings edge up 1.4% to US$10.6 mil

SINGAPORE (May 23): Singapore Shipping Corp (SSC) reported a 19.2% rise in 4Q19 earnings to US$3.1 million from US$2.6 million in 4Q18. This brings FY19 earnings to US$10.6 million, up 1.4% from a year ago. SSC’s ship owning business reported flat 4Q revenue of US$8 million while 4Q profit rose 10.6% to US$2.7 million. Its Agency and logistics business reported a 32.1% rise in 4Q revenue to US$4.5 million although profit fell 4.3% to US$0.76 million. Results from operating activities fell 1.1% to US$3.2 million. The company has proposed a final dividend of 1 cent per share. In....
Read More >>

SIA kept at 'buy' with transformative journey improving profitability

SINGAPORE (May 23): DBS Group Research is maintaining Singapore Airlines at “buy” with $10.80 target price on expectations of improvement in SIA’s profitability in FY20 as it carries out its transformative journey and valuations stay undemanding. DBS credits SIA’s transformation programme for making a difference with revenue growth finally returning after years of stagnation and cost management efforts also bearing fruit. This is evident in SIA posting stronger profit performance in 2H19 compared to 1H19. In addition, although jet fuel prices have rebounded to US$85/bbl currently....
Read More >>