Posted by: donmihaihai | April 22, 2011

Random post on Annual report 2010.

Haw Par Corp
A small surprise that total number of shares in UIC, UOL and UOB is given. Maybe this information is not a big secret, just that there isn’t any need to talk about them unless there is some changes. Notice the same thing from UOL.

My reverse engineering work! I almost get the exact number of share in UOB correct. The difference is Haw Par investment in other AFS.

Another surprise is lease commitment. Total commitments increased by 3X and annual commitment doubled. What happened? Anyone ask it during AGM? Wee has been entertaining lot of questions regarding selling UIC, UOL and UOB, what will his reaction be if someone ask him about share-buy back, market purchase of his related companies when price is low?

ARA Assets Management
It is not easy to find a good business. How much capital is required to generate current earnings from REIT and private fund? Not much and increase in AUM does not require the same increase in capital. What a business.

ARA houses another business of the same. It real estate management service is another. I don’t have any breakdown but I guess the backbone of this business is the management of MCST 2197, Suntec City. With the kind of return, it is not hard to guess the amount of premium they are charging. Because of that, I don’t think there are lot of growth from here as this whole industry is price sensitive and only those REIT holders who unable to see the pricing are willing to pay for it.

Of all the AFS hold by ARA, the most interesting and cheapest of all is going to be the 13% stake in APN Property Group Limited. I mean why not. APN is in the same industry so unless they sink APN, buying at around NBV is very cheap.

YHI International
YHI did very well in FY2010 even when its manufacturing segment was doing badly. And it decided to make a major push into the low end of manufacturing business going forward with the possibility of raising capital. I can’t do anything. Share price is cheap and I don’t see owner-operator sinking this ship.

This owner-operator likes to dress-up, reporting good news and say nothing about bad one. Flooding in Queensland Australia cause certain damage to inventory of about 6 million. While it was being covered by insurance, it is also material enough to be included in sequence event of annual report. Anyone ask them during AGM?

Banyan Tree
I hate it when any annual report goes into almost 200 pages. Banyan Tree is one that I try not to hate it because I understand one of the reasons for doing so. Annual report is going to be another marketing tool for Banyan Tree and unlike many company, any potential reader of Banyan Tree annual report is likely to be their targeted segment.

While I do not like some of their strategy, I think it is on the right path and Chairman closing note is proper. “We have sown the seeds for future growth, may the coming years be fruitful.” If not it does not justify the amount scale and expenses.

Sarin Technologies
Am I reading a book on management and competitive advantage? This is a real life example of management putting it down in word, of achieving competitive advantage, strategizing, enhancing and gaining better going forward.

R&D or technology created Sarin Technologies but competitive advantage created by R&D or technology alone is not long lasting. They understand it better.

What a turnaround year.
I believe I will be reading a lot of “we have achieved a strong turnaround in FY2010” kind of comment in FY2010 annual report from chairman, managing director or CEO. There are company generating increased in revenues or most importantly NPAT of double or even triple digits. Some are even better from making losses to generating profit. If that is the meaning of strong turnaround or strong performing then of course, let pat each other back and write some good letter to shareholder, if they are like me unable to write a good piece, engage a PR firm like NextInsight. They will know what to do.

What is so good of the turnaround when you are getting a ROE of 5% with high leverage or getting return about half you used to get. A business owner won’t say that but well, they are answering to a batch of shareholder who main objective is to see an upward swing of share price. So whose fault? Their or ours? I don’t know but it does created business like investor relation to take advantage of that. I would love to have those money being pay out as dividends.

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