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OCBC Securities 2015-08-14: Wing Tai Holdings Ltd: 4Q15; Dividends lowered to further buttress balance sheet. Maintain HOLD.

WING TAI HLDGS LTD W05.SI

Dividends lowered to further buttress balance sheet 

  • Wing Tai reported that its full year FY15 (ending Jun 15) PATMI decreased 41% to S$150.3m mainly due to lower YoY contributions from its development segment (The Tembusu, Le Novel Ardmore, Foresque Residences, Helios Residences and The Lakeview in China) and a weaker share of profits from Wing Tai Properties Ltd in Hong Kong. 
  • Adjusting for a S$21.0m gain on disposal of a subsidiary, core FY15 PATMI constituted 122% of our full year forecast which is somewhat above expectations due to the lumpy nature of progress recognition. 
  • FY15 revenues fell 16% YoY to S$676.7m again mainly because of softer contributions from property development (down 21% YoY to S$430.2m) and retail (down 7% YoY to S$199.0m). 
  • Management has declared a final dividend of 3.0 S-cents, which disappointed expectations and is 50% lower than the 6.0 Scents last year, in order to conserve cash and further buttress its already solid balance sheet. 
  • The group’s net gearing ratio is now at 10% versus 16% as at end of FY14. Maintain BUY with an unchanged fair value estimate of S$2.58. 


Eli Lee | http://www.ocbcresearch.com/ OCBC Investment Research 2015-08-14
BUY Maintain BUY 2.58 Same 2.58


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