A review of my counters performances

The earning reporting season is almost over, I thought I look back at my buy reasons, to see if there are still valid. As for sell reasons, it could be target is exceeded or buy reasons no longer valid. Let's do this in a more relaxed star award style. Interviews with winners are my imagined conversations

Most Lucky Award 

Winner:
1) The lucky switch from Golden Agri to China Merchant Pacific Holding

I sold Golden Agri at 55 cents. It is not because there is something I think is wrong with Golden Agri, but that I want my portfolio to be income generating and not so much for pure capital gains. Of course, I don't mind capital gain and income generation.

I would have been sitting on paper loss and missing out on China Merchant Pacific Holding gain and income.

China Merchant Pacific Holding buy reasons.

1) Sustainable 7% yield
2) Dilution from CB will lead to yield accretive acquisition which would either offset one another or result in net gain.
3) Strong FCF generation.

In the latest report, CMPH has already turnaround Jiurui it seems, with a 12 million contribution from Jiurui. and in its review it is state "negative goodwill amounting to HK$22.8 million arising from the acquisition of Jiurui Expressway. "

So jiurui actually still making a loss of 10 mio??? 
Net Gearing Worsen, but will improve with the conversion of the CB, assume no further take up of loans, net gearing will be below 0.3.

I do have some questions which I posted on valuebuddies, reader can look at the link on the right to go to valuebuddies to read the answers (if any). The questions are:


It is stated that Jiurui contribute 12 mio to profits, and in its review it is state "negative goodwill amounting to HK$22.8 million arising from the acquisition of Jiurui Expressway. "

So jiurui actually still making a loss of 10 mio??? correct? I thought the Jiurui's turnaround is super fast, until I saw that statement.

Also it states that 
Guihuang Highway ". Profit contribution from Gui Huang joint ventures increased 8.7% to HK$134.2 million, mainly attributable to higher toll revenue and other toll road related income achieved,

But the traffic vol for road is actuall lower. I am not sure how to comprehend the numbers with the statement, can someone enlighten me?


Interview with winner of Most Lucky Award, CMPH:

What is the secret of your success?

CMPH:

My secret? I don't go to ah longs to borrow money. I go buy peers who go to ah longs to borrow money, because I have a rich parents, I say I want to borrow money, the banks give me great rates. So, when I change the ah long rate to better rates, I make money, just like what I did for JIurui!

Also, I have plenty of tricks up my sleeve. I have convertible bonds, now I have bonus issue. You don't know what I am up to right? That's why I am successful, because I am the deep one LOL


Mr Market Laughing Award 

Winner:

Lee metals. 

I got almost everything about Lee metals correct. It will be able to navigate the current low steel price environment with 1 cent EPS, Q4 dividends is 2cents, the mid point of the range of between 1.5 cents to 2.5 cents.

I expect operating numbers to worsen, and indeed CCC is bad. (See previous post). I need the AR to know if there is impairment to inventory. I would rather Lee metals do it and still eked out a profit as there is the conservative thing to do. 

I expect Mr Market to re-rate the stock to take into account the generous dividends and ability to navigate down cycle of the steel industry.

But nope, price hardly move. You get all the reasons right but still lose. So Lee metals get my Mr Market Laughing at me award.

Interview with winner of Mr Market Laughing Award

How do you feel about getting this badge of shame? I mean fame.

Lee metals:

Please look at my track records. I have been in this line for donkey years. Mr market can laugh all he want, stay with me, I will keep paying you dividends. Show me a company that do that. Oh, I mean show me a company that do that and do it every quarters but is not a reit or trust. 
Oh, what? There is UMS? Go court her la! 

Most Attitude Company award

Winner: 

Venture.

Venture is a company that many believed is a yesteryear company. Maybe it will be a long long time before it returns to its glory of a hot grow stock with PE of above 20. But it is no creative indeed. 

It has shown consistent quarter to quarter and year to year growth in gross profits for 2 years. Had the tax incentives for its subsidiaries not expired, its net profits would be even higher. 

Why is it "attitude" then?

Because it doesn't care what other think.

SSH Aberdeen Asset Management PLC has been selling and selling, causing a drag in shares price whenever it rebounded. Maybe they know something that retailers do not know, but heck, Share price just keep recovering and going higher. 

When there is expectations that the 3D printing will turn the fortunes in its Printing and Imaging Segment once the prototype for Straya 3D system in Shanghai goes into formal production, there is no updates on it. Looking at Q4 weaker results in this segment, it made one wonder if the 3D prototype has failed. Instead it boasts about its capability in its "test and measurement/ life science and medical segement" and has the audacity to ask the whole Singapore of precision manufacturing to look into this area and create eco-system around it.  

Also, given that payout is almost 100% of its earning and above 100% of its FCF if we include expansion capex used in new factory/property purchases. Do that have the sustainability to keep paying if their earnings do not continue to improve over the few years? But nope, its the third year that they almost or pay more than their earnings, and no matter what others think, Venture do as they like. 

Interview with winner of Most Attitude Company award

 How do you feel about getting this award?

Venture:

You guys are funny, I sustain dividend payout, you think I am not prudent, worry about FCF etc, if you cut dividends, you guys will cow bei cow bu even more right?

Look, I am successful in diversifying more customers base, my new customers are helping to offset the weaker orders from my old customers. But look, we are progressing. 

What, orders from existing customers will get smaller and smaller? You are trying to trap me right? Last time, I say I expect recovery in the 2H, and it didn't happen, you reporters, analysts were on my neck, say and think I "dua bao sian", now of course I give those generic useless outlook comments that can go both ways, so heads or tails I can also say: there I tell you so!

Aiya, I very busy la, don't disturb me already. Aberdeen already always bothering me, telling me Net margin should be above 6%, ask him to come run the busines la.

Falling Knife awards

 The climax! Falling knives award! We have 3 award winners this year!

1) Sembcorp industries
2) ST engineering
3) Lippo Mall Retail trust

Sembcorp's subsidiary Sembmarine is from the O and G sector, so with the collapse of the oil price, and the possible fallout from Brazil Petrobras, in terms of drill ship orders, it is little wonders market think Sembcorp Industries has a bleak outlook.

Well, bottom fishing is always also a game of knife catching, Sembcorp Industries not only have problems with Sembmarine, Its Singapore utilities business is also facing headwinds in term of competition and rates. Double whammy if you like. 

But as long as Brazil Petrobras don't cancel orders, with its big orderbook and its overseas utilities projects coming online over the next few years, Sembcorp utilities do look like it have 2-3 years window to ride out the cycle unscathed. 

ST engineering is a big company with many businesses, when I bought the company, I believed the growth drivers to come from aerospace and electronics, especially in the AMM segment and the Large Scale System segment of aerospace and electronics. These 2 segments did not disappointed, but these 2 segments are small in proportion to the other segments in aerospace and electronics. A oversight in research. Would I have bought ST engineering at the same entry price if I think the pockets of growth are relative small? I am not sure. 

Also the MRO segment of aerospace is really bad, as with the Automotive segment of Kinetics. I thought defense segment is all weather business. I am wrong. Of all the counters I have, ST engineering is the one that spring the most surprises in terms of results. 

Whenever Lippo announced an acquisition exercise, it will be meet with heavy dose of skepticism, and the bad track record of value-destroying fund raising. I however think Lippo did relative better this time round compared to the past. But compared with the deal CMPH closed on Jiurui, Lippo mall retail trust can really learn a thing or two. 

All 3 winners of Falling Knifes award refused interview. 

Most Resilient Newcomer Award 

Winner:

Industrial reits- Ascendas Reit and Maple Tree Industrial Reit

Both are recent addition of less than 9 months.

Industrial property outlook is poor as compared to commercial, retail, hospitality etc. 

When I buy, I expect to hold it for the longer term and is willing to sit through slight capital loss as I collect dividends and await the cycle to turn.

However, not only has the operating numbers and payout not disappoint, it has not suffered capital loss, even as I collect the dividends. 

I do hope they can continue their solid performance so that I can continue to milk them

--------------------------------------------------

In conclusion of the sillyinvestor's star counter award, what are the counters that Sillyinvestor Inc will terminate contract? (Sellout)
None. 

Any that will suffer possible renegotiation of terms? (Reduce size)
Yes.

1) All falling knifes awardees

Any that will be sold and transfer to other Inc for a profits.

Not at current prices, but if prices continue to raise for another 10% or more, possible transfers include:

1) Venture
2) Ascendas Reit

Random thoughts: choosing a primary school and choosing your investment

My son will register for his P1 this year.

The initial plan was to follow me to my school, but my wife wanted him to study somewhere nearer, and also together with my niece, so that they can keep each other company.

Today, when picking up my wife from her workplace, I give a lift to her colleague too. This was the fifth or sixth time I heard this: why did I transfer out of my previous school and not wait till my son is ready for P1 so that he could get into a "renowned" school.

During CNY, I was asked to try appealing to get my son to my previous school. 

The renowned school effect suffered from investment herd mentality too. 

I am really glad I stepped out of my comfort zone and went to a neighborhood school and saw the contrast.

Both schools have their strength. However, due to the profile of pupils, one would never catch up with another in terms of results, at least not in the near time. 

So, if a particular school has a very high percentage of pupils going to express, it means your son has a higher chance of going to express too? Right? WRONG.

Too many factors come into play, the neighborhood school have equally good teachers, but their pupils do not have the cultural assets of tuition and exposure. It matters. Parents involvement matter A LOT.

Pupils learn best when parents and teachers work hand in hand. What happen if pupils are left on their own, without any support beyond sending their children to school?

That is where the advantage of a neighborhood school come in terms of pedagogy. If the teaching doesn't work, it hell shows. 

I pride myself as a results producer, when I come over here, I do not yet know if my methods will produce the same results since I have not go through the rite of passage yet. What I did in my previous school which won praises and gratitude from parents, many of my current colleagues are already doing it, and some are even going beyond what I used to do. 

If I shift the current teachers back to my previous school, does it mean the results will fly even higher? 

The answer is again unclear. One, the pupils might be already at their potential, another is the culture which is vastly different might have made teachers in one particular school not do what they could in another. 

In the end, is it the parents, or the teachers, or the child that is most important?

After I answer this question, I ask myself is buying what gurus buy at same or lower prices the best or safest approach in investing?

Know your child, know yourself. Know your temperament, know your investment. It does not matter if you follow guru or not, it might or might not lead you to fortunes. 

Random thoughts: Getting thick skinned as I age/ grow

In the last 6 months, I felt I have become different. Neither good nor bad, but after facing inner demons for a while, I realized many  things that would have upset me or bother me, begin to come and go more easily. I think I have gotten a bit thick skinned

Remember I blog about organizing the CNY concert. I thought it was a job well done, but my staff think otherwise and believed that there were many hiccups. Well, I have to tell them we can planned until the cow come back and things will still go wrong, but generally, I think we did ok. LOL

I made a mistake and had a clash of committements. I told my Ps about it and got a "saying" i usually would feel quite bad, incompetent etc. for quite a while, this time round, it last just 5 min and I laughed it off.

I am quite a henpecked husband, but now, I quite straight forwardly "tell my wife off" in a gentle manner without feeling anxiety LOL. And she didn't even mind. 

I told my staff to leave earlier in a useless briefing, he was shocked. I said, just read the info. 

Getting my thick skinned is a good thing in my opinion.

I see things less "absolutely" now. 

With all the changes in the CPF lately; there were plenty of calculation of impact. For me, I think it is a wonderful system, and the gate keepers have thus far doing more good than bad. But I refuse to calculate. 

Too many variables can be, and might be changed, and perhaps too frequently at the "whim and fancy" of gate keeper.

Although many changes are for the good than bad, but I prefer it as a sacred cow than a convenient tool.  

Look at the changes in contribution rate. It is not infrequent. Although the raises are more than the falls. So, am I very excited about the raise in income ceiling and 1% more interešt for those above 55? I am

Not. 

Minimum sum calculation is still not clearly explained on how future adjustment will be. I am

Not against adjustment per se, but words like the rate of adjustment to take into account cost of living and STANDARD OF LIVING will not BE AT THE PACE OF RECENT years are just too vague. 

Then we have the DDA

When my time comes, can someone tell me what is the DDA?

When I can take 20% lump sum, I will take it. Unless I have so much outside the system that CPF is just a small supplement of my retirement plan, which I think on the contrary, I think CPF will form the bulk of my retirement fund, I want the stark in hand. You can calculate all the interešt I will be losing but I won't blink.

A bit out of point towards the end. But I just blog where my mind goes. I thick skinned, remember?

Correspondence with Parkson Retail Asia IR

Below is my correspondences with IR. They avoid my questions, but I guess to be fair, I do not expect response to the second query. 

But I think in the first query, they are trying to assure us that most tenants are still with them. 

---------------

Qn:

Hi 
I am Mike, a retail investor. I refer to the following articles

http://m.thanhniennews.com/society/retailers-angry-following-parksons-sudden-closure-of-hanoi-tower-37164.html

http://www.talkvietnam.com/2015/01/public-condemns-malaysian-retailer-for-shutting-down-parkson-landmark/

Maybe the IR can shed some lights on how this could have happened, and what are the implications on Parkson.

Ans:

Dear Mike,

 

We refer to your earlier email dated 15 February 2015 as well as a similar enquiry you’ve made to Parkson Retail Asia’s (PRA) management. You would be pleased to know that PRA’s management has reverted to us on your earlier enquiry, and that we’ve also communicated your latest enquiry to them.

 

On behalf of PRA, we wish to clarify that the closure of the Landmark-Keangnam store in Hanoi was done in the interest of the Company and by extension, it's shareholders. As the rental payable for the store was unsustainable due to the weak discretionary retail spending in Hanoi, PRA tried re-negotiating with the landlord to revise the rental rate to a reasonable level such that it could be a win-win situation for all stakeholders. However, PRA found that a favourable response from the landlord was not forthcoming, and hence decided to close the store on 2 January 2015 to preserve the profitability of their Vietnam operations.

 

PRA has explained the situation leading to this store closure to its tenants and found that the majority of them understood its predicament and its resulting action to close. PRA would like to note that its relationship with its tenants span many years, and that many of the tenants previously operating in the closed Landmark-Keangnam store are also tenants in PRA’s other 9 stores spread across the cities of Ho Chi Minh, Hanoi, Hai Phong and Danang in Vietnam. These tenants continue to work with and support PRA in Vietnam. Parksoncontinues to be the premier department store in Vietnam since the first store was opened in 2005 and PRA wishes to assure you that all actions taken are in the interest of the Company while protecting its reputation with its customers.

 

The management of PRA hopes for your understanding regarding their actions on the closure of the Landmark-Keangnam store, and they would like to thank you for your interest as a shareholder in keeping abreast of the Company's corporate developments.

 

-----------

Second query:

Dear Wilson,

Happy New Year, Gong Xi FA CAi. Thank you for your reply. I understand. I would like to know the impact of Vietnam Withdrawal. From my preliminary research, given Keangnam tower Parkson has a key able area of 28700 square meter and an average rent of 60 USd per month, a year rents could amount to 27 mio sing dollars in a year. That's pretty scary. 

Imagine the amount of compensation.

Source:

http://english.vov.vn/Economy/Retailers-still-on-a-roll/228808.vov

Perhaps some light can be shed on the amount of compensation.

Regards,

Mike

-------------

And:

Dear Mike,

 

You’d be pleased to know that Parkson Retail Asia’s (“PRA”) management has responded on your email enquiry dated 20 February 2015 relating to compensation. While they are of the view that any discussion of compensation is premature at this point, they would like to assure you that the Company will comply with SGX’s disclosure requirements with regards to material information.

 

PRA’s management would also like to thank you for your continued interest as a shareholder in their company. Please let us know should you have further questions for the management.

 

 

Warmest Regards,

----------------

It will be out of bounds for me until there is clarity on compensation.

Lee Metals 2014 FY results (Trend analysis) Updated 26 Feb

Lee Metals has announced FY results last night

In the broader area of EPS of Q4 and dividend, Lee metals did not spring any nasty surprise. Q4 EPS is almost 1 cents, and Q4 dividend is 2 cents. FY dividend of 3 cents translate to a yield of 9%, but such yield will not be repeated for next year.

Lets look at the nitty gritty:

The important margin to look out for include margins, and ROIC, ROE, COIC, ROA etc.

I am not number crazy, as long as there is no sudden spike or crash to warrant attention to more qualitative analysis, I left it as it is, I think the broader operating metric is still rather decent consider the challenging metal environment

However, Cash Conversion Cycle is at the longest in more than a decade. Receivables is growing faster than the revenue growth of manufacturing and fabrication arm of Lee metals, and this arm is giving longer credit as stated in the quarter report.

Manufacturing and Fabrication margin has also fallen steeply to a low of 6.56%.

Turnover volume has increased but offset by weak steel price.

Given that the steel price has been on a downtrend for more than a year, I expect results to be ugly.

Bright spot is FCF is still strong, and Steel Merchandising is still turning in a profit (abeit low) of 3 million.

I am however wondering if there is still a need to continue expanding on the fabrication and Manufacturing. Depending on the sources you look at, Rebar steel prices has fallen 10-15% compared to a year ago, and given turnover remains relative the same, we can assume tonnage actually increase by 10-15%

But the construction demand while robust, while no longer be growing as residential projects taper off.

In conclusion, I believed the good years of Lee metals might be over.

But I believed it can still manage 4 cents EPS for years to come and continue to pay out 1.5 cents to 2 cents annually. Its execution records so far has been good,

Given the price fall, I believed the bleak outlook is priced in and can be compensated by the yield.

I am holding,

P/S: if you want my excel sheet for easier viewing, just drop me a comment or email

NEW:

I wanted to know how BRC asia is faring, particularly in terms if CCC, if it is also increasing.

It seems Lee metals did not fare badly compared to BRC asia

CCC is increasing too, and both look ugly when compared to Lee Metals

Margin also under pressure.

So, at least in terms of competition, Lee metals is not going to be killed soon.

Random thoughts: some great places to visit during CNY

Well, it depends on what you want.

If you like crowds, like theme rides and jostling around for the restive spirit, river hongbao is the place for you.

Uncle Ringo pull out his stuff for everyone, there is plenty of rides for the young at heart and kids. 

However, we managed only 4 rides in 2 hours as they are long queues everywhere and my wife and I have already split ourselves up to queue for the kids. ( son and cousin )

If u like peace and quiet and some simple photo taking, which is what I like, airport is not too bad.

They recycled the T3 Christmas decoration by changing at the fringe, but not too bad.

For a family outing pleasing to the elderly, Sentosa is not bad. My parents watch the Northern Lions perform and they are a class of its own. Such a grade of performance can be paid to be watch but it's free. I also get to finally learn the difference between southern and northern lion from the emcee. 

See also the Merlion at the backdrop? Nice view right? Not to mention plenty of photo taking spots.

Reserve a place for your dinner though. I didn't plan my trip well enough, did not catch all the performances but still lucky enough to see fireworks and the laser dragon at beach plaza just below beach station ( ok only if u ask me)

So where did you go? 

Don't forget, it's who you go with that's the most important consideration factor.

Too "iron teeth" for my own investment health?

Reading around forums and blogs, I realized I am one of the few lone investors that are fully vested currently.

I did think of increasing cash when "price" is right, but the fact is, I do Not feel like taking any money off the table since most counters have yet to announce the results and I have yet to milk them for years, I brought most of them rather recently, unlike some other bloggers who have milk them for years.

There is one loud voice and it is getting louder. This is the seventh year of bull, fed hike is coming either in June or perhaps 1-2 quarters later, Greece is playing blink,   Shouln't I be waiting with a big war chest. Also, most of my counters are in green, I would not be losing out for dividends for 1 year or 2 and I could wait for the crash to buy back in the 1 year or 2 window.

Then, there is another voice. If I am taking profits, I might as well hold all cash. Or 70-90% cash since you cannot lose if you are not in the market. 

Then the third voice. The reasons for buy and sell. I believed Venture to do well this and in 2016 with the 3D prototype up and running, shouldn't I wait for the catalyst to happen or unless proven wrong that it is not going to happen. 

Why shouldn't I sit on a possible Dividend increase of SSC, if 6-7% dividend is sustainable for my industrial reits for the next 3 years as per my reason for buying, why sell now?

I am quite sure I will not be increasing my equity even when I look forward to my performance bonus. My cash will slowly increase again. I have not touch my endowement with cash value ( no penalty, cash back feature) and my CPF. I do not think if a 30% crash happen soon, I think I can still take advantage of it. Of course, I am not dogmatic in my approach, I would think if I made 3-4 years gains of dividends it might be a good idea to lock profits since highly unlikely for a bull to last more than a decade. 

So here I am, iron teeth about my investment and not liquiding them yet. 

Maybe I am setting myself up for a regretful goat year? Let's see how things pends out. Ram can be stubborn too, you know, and I am a goattie

Random thoughts: Having fun organizing CNY concert

First of all, wish all readers a wonderful New Year.

This is the first year I oversee the whole CNY concert for my school, I am usually just in charge of a small segment, and even if I did organized the whole event before, I used to have senior teachers and HOD advising and guiding me. This year the role reversed.

I am born in the year of the Goat, I knew this year I am "supposed" to be super "bad luck", so I mentally prepare myself for all hiccups. 

During the rehearsal, the staff in charged of slide presentations did nothing, although I did remind the IC to ask her to consolidate everything.

One good thing happened: I didn't lose my cool, I simply ask her to gather as much as possible, do simple samples AsAP so that we can at least proceed with the rehearsal, which she did. 

About half the performers did not turn up for the rehearsal due to competition committment.

At the end of the rehearsal, the stage screen broke down. It could no longer move up and down. My TA teacher told me in a very solemn manner that we must think of what to do if it cannot be fixed in 2 days time. 

After speaking with a few people, I decided with Plan B, taking out all items that required the projected screen and replace it with interactive games with the audience.

Then my P told me it is better to have the screen always down instead, which create another set of problems with performers like wushu and dance that required the whole stage!

I start formulating Plan C. By then, I was told the good news the screen was fixed. And the most heartwarming thing is I saw the "bo chap" teacher rehearsing of her own the newly created slides which I think was a job well done! 

The IC was very in the ball too, when we discuss about what went wrong during rehearsal, there is no finger pointing just cool discussion on what can be done.

The actual day started without much hiccups, until we realised the Lion Dance CAi Qing created a big mess at the stage with local lettuce, orange skins and star dusts on the stage floor after their performance. 

The dance teacher was telling me they cannot perform in such a stage and The pupils will slip and fall. We immediately change the sequence of the items and sweep up the stage with curtain closed.

Phew...

Things run very smoothly with very little "white spaces", so smooth that we will end earlier by 30 min!! My teachers were saying this is the first time it happen! 

So, I told my teachers we will have a surprise item of peeling oranges competition and I got my colleagues to join as participants at a short notice.

The pupil emcees were worried. I told my teacher Training them to just say:" we have a surprise item" and pass the mic to me.

After the event ended, everything was also Sui Sui to me. A wonderful CNY celebration, one that I thought it's really fun as many things were done nicely impromptu without planning!! 

Of course, it could not have happened without the brains of my teachers who highlight the issues to me.

A wonderful day and I felt so satisfied going to the year of the goat after the event.

A wonderful start in my eyes.

Wish all of you a happy new year too!

Parkson Retail Asia: Vietnam operations

I think it's important to write this in a new post instead of just updating my previous post.

Further Update:

Closed store at Hanoi not managed properly.

http://www.vietnambreakingnews.com/2014/10/image-gloomy-scenes-at-the-largest-shopping-centers-in-hanoi/

http://m.thanhniennews.com/society/retailers-angry-following-parksons-sudden-closure-of-hanoi-tower-37164.html

Parkson has a lot of explains to do, especially with the sudden eviction nearer to CNY

Also, given Keangnam tower Parkson has a key able area of 28700 square meter and an average rent of 60 USd per month, a year rents could amount to 27 mio sing dollars in a year. That's pretty scary. 

Imagine the amount of compensation.

Source:

http://english.vov.vn/Economy/Retailers-still-on-a-roll/228808.vov

I have written to IR, hope they reply soon, and I will update again

Random thoughts: Diary of a whiny kid

Taking care of my son always give me flashbacks of myself when I am a kid.

When I get into secondary school, I had the most discontentments.

Discontented that:

My parents were always quarreling 

I need to help clean up the hawker stall at night

I lived in a cramped HDB that did not even have a table for study.

Do not have enough pocket money to go out with friends.

Do not have video games at home

Now I realised then I could

1) sleep as long as I liked as long as I do not have Saturday CCA training.

2) free to roam around until 8 pm before I reached home, even on non- CCA days

3) parents who didn't bother or too busy to bother about my studies, so that I grow independently and work at my own pace.

4) My parents who in return, never expect anything in return, be it money, time or love.

So, I wondered, 30 years later, when I looked back and see myself now, there will definitely be things which I missed. 

Some blessings which will only be understood in hindsight.

Then another thought came: 

If I knew what I know then, 20 to 25 years ago, would it make a difference.

I am not sure. I will still be unhappy with the quarreling. I might save better, with more allowance to go out with friends, but if not for yesterday experince, would I be what I am today?

At the end of the day, I do think hindsight understanding is overrated. 

Parkson Retail Asia updated 2: An unappreciated counter that deserve a second chance

Parkson Retail Asia deserve a second choice, and it should give me a second chance to buy it again.

We need to look at Parkson Retail from another angle.

Yes, it might have disappoint in the growth front, but at current price, what are we looking at?

It got this screen shot from morningstar, if we look at the QoQ results, Parkson results has improved for consecutive 2 quarters.

We need to look at it in terms of the effect of losses of new stores

My Quarter results are according to the calendar, not what Parkson Reported, in 4Q, the 3 stores reopened. 2Q is the worst with the most accumulative stores under 1 year (Said to be loss making), which also showed in the losses of new stores analysis, especially in the problematic Vietnam store.

Going forward, the next quarter might be also tough, since 3 new malls opened.

But lets look deeper, the latest quarter Accrual of store closure costs (2,311) has more than offset the gain in disposal of associate (Odel) = 1,379. The accrual of store closure is for Hanoi, I am glad that they throw in the towel! It's ok even if they still need further write down. At least this pain will be over.

If we look at the FCF, although the opening of new stores are rather fast and furious, Parkson still managed FCF every quarter except in the quarter leading up to March.

Also they have push back the opening of 2 new Indonesia malls to a year later. It is not difficult to see why? Indonesia New stores opening are burning profits, and the latest quarter show Indonesia profits falling QoQ, instead of what some analyst report that states Indonesia is the glowing spot.

Despite the doom and gloom, the problem of Vietnam, the giving out of special dividends, the Malaysia facing headwinds, weak Ringgit etc, the cash level of Parkson is at highest for the past 3 years.

It is not too much to claim that it is cash generating machine.

I do not think Parkson Problems will be over anytime soon. Think ringgit weakness and consumer tax. But I do think it will survive and continue giving dividends of 2.5 cents - 3 cents. which means a yield of 3.7 to 4.4 % Not too bad as you wait for the malls' operations to stabilize and the expansion to tamper off.

I would think if Parkson is to fall further, it would really look attractive at more than one fronts.

Yup, I quite disagree with many points a analyst raise about Parkson.

Next, Tan Sri Cheng Heng Jem holds, directly and indirectly, 53.52% of the voting shares in PHB, which is the sole shareholder of East Crest International Limited. East Crest International in turn own almost 70% of Parkson. There is no insider selling, and I assume the Parent would want money to flow back upwards, hence I believe the "will" to distribute dividends will be there.

They are paying themselves peanuts. I like.

 
In terms of presence in popular malls, parkson has done a good job too. Look at the three links

1) http://www.kuala-lumpur.ws/klshopping/top-10-shopping.htm

2) http://www.wonderfulmalaysia.com/faq/top10-shopping-malls-in-kuala-lumpur.htm

3) http://web.parkson.com.my/whatson/store-locator/

In either surveys, Parkson is the anchor tenant in 4- 5 of the most popular malls.

Also, if u take a look at Aeon, a competitor in the department store space. U compare Apple to Apple, by taking only Aeon Retailing Segment and Parkson Malaysia Segement, Parkson again fare better.

http://ir.chartnexus.com/aeon/quarterlyreports.php

Although Aeon Has other business segments, the valuation gap for the two is too glaring too

Further Update:

Closed store at Hanoi not managed properly.

http://www.vietnambreakingnews.com/2014/10/image-gloomy-scenes-at-the-largest-shopping-centers-in-hanoi/

http://m.thanhniennews.com/society/retailers-angry-following-parksons-sudden-closure-of-hanoi-tower-37164.html

Parkson has a lot of explains to do, especially with the sudden eviction nearer to CNY

Random thoughts: Kite flying at Valentine Day

 Kite flying could be done during Chong Yang, but we did it during valentine morning.

Was testing the DIY kite my son made. Kites will be what my class will be selling at Sentosa Flea market

Nice? Cannot really fly at my MIL condo compound.

My son and I have a good time running around though while my wife gave my the "my 2 kids" look. 

The spirit of kite flying, going outdoor with family is what I have in mind when I finally decide to sell kites. 

Just like investing. The toughest part is not actually the type of kite, but the area you are in, is it spacious enough? Is there tail wind? 

Even you have both, it is always tough at the beginning trying to get it off the ground to fly. Once up in the air, all you need is to tighten and release.

Our kite keep crashing to the ground. But if we do not lament the crashing, and try again, it is still quite fun, isn't it?

Although I am a bit worried about selling faulty kites, my wife told me it has nothing to do with the kites but our skills. 

Happy Valentine day, everyone!! 

I bought the most ex. Valentine present in my life and wife doesn't like it. Sigh... That's life. LOL. May you have better luck with your valentine

Random thoughts: The noise

There is rather frequent reports of air accidents recently. I do not think anything is wrong with the aviation industry in the sense that I do not think anything is wrong with our roads. Not that it is perfect, but I think you get my drift.

So I was rather surprised when I was told not twice but thrice about people being apprehensive about air travel. 

I was surprised to hear that I might not get 20% of cohort to go overseas for immersion programme when in previous years, the demand is overwhelming. The reason: air accidents

My wife told me her colleague ask the P to be excused from overseas trip because she is worried about air accident?! Hmm... What makes she think the P will cancel the whole trip just to consider the recent spat of accidents 

Then I overhead my MiL saying about not air travelling. I couldn't help

Myself and smile, and say that I will be going to NAnjing with pupils soon. 

To think further, we also like to link news1 with 2 and make conclusion I out investing decisions, isn't it? When we should be looking at the valuation and the longer term viability of the business. Read Grexit, read plunging oil, and we might think a bear is coming, but the truth is, we will never know if it's a bull climbing a wall of worry or the frog is being cooked until we exited. If we exited with nice profits, we are buying high selling higher and the bull had climbed the wall of worry. If we wait till the cow comes home and the water is boiled and lament not exiting earlier, then we are the frog.

2 things count: your robust research and analysis of the long term attractiveness of the business and valuation. Valuation determine buy sell action 

LMIR: dissecting the latest Q4 numbers - updated

Lets do number crunching.

I want to know the impact of Kemang Village to distribution.

Before 17 December,

Distribution = 0.57 cents (Higher than projected)

Hence, 0.57cents * 2462648552 (no.of units)= $14037096

That is for 77 days, assume no seasonality effect within a quarter,

The second distribution, LMIR existing portfolio would contributed $2369899 for 13 days

Kemang Village will then be:

0.14 cents* (2462648552+117647000(equity shares placement entitled to distribution) minus $2369899

= $1242514

That is Kemang impact for 13 days. Do it for 30 days it will be

$2867340


So the new 30 days distribution for enlarged portfolio going forward should be $19274335

Total enlarged base of units including consideration shares will be 2701802668 units

Going forward, the distribution would still be 0.713 cents.

If this is really the case, then Kemang will be accretive!

However, in its latest presentation, LMIR no longer break down the occupancy of the malls.

If you use simple proportionality logic and look at its operating numbers, without Kemang, the portfolio is HARDLY shrinking or growing.

However, the IDR impact might be more favourable going forward.

Finance expenses is reduced, if this is not volatile, it will be another plus for Alvin

So, any regrets trying to catch a falling knife?

I do not have, looking at the results, I think the new CEO passed his first acquisition test.

Disclaimer:

This is not a buy call.

My average price for LMIR even when I accumulate in recent weakness is still a high 41 cents, which means I have vested interest.

If my hypothesis is right,

LMIR is a steal when it fell to 30.5 cents (I didn't have such luck)

Fairly valued now at 35 cents.

Also highly unlikely to hit 41 cents in the short term.

But am I selling?

Nope, not at 35-36 cents, I might as well take dividends.

I might sell at higher than 36 cents if I see better alternatives, which I am monitoring now for a few, which I think is interesting.

A quick look at Ascendas Hospitality Trust

Note: Not vested.

A few things caught my attention.

The unwinding of the CCS is over (October), it is 8 months earlier than when they first projected it to be done by June 2015.

From the latest results, CCS costs is 3 mio, and 2.1 mio and 1.8 mio in Q2 and Q1. There is a acceleration in unwinding, yet DPU is increasing since Q1, despite further AUD currency weakness in Q3 compared to Q2.

Its operation in Australia (Biggest Contributor) is going from strength to strength since Q1

Occupancy rate is 78.5%; 84.3% to the latest quarter of 87.3%
Average room rate is $165; $162 to the latest  quarter of $184.

Lets annualized Q2 results (more conservative) without the effect of CCS instead, we would get
 (1.46 x 4 ) / 70, there would be a yield of 8.3%. Look pretty cool to me.

Assume a further 10% fall in AUD, resulting in a corresponding 10% fall in NPI. We get DPU of  4.6 cents just from Australia operations, and at Q3, Australia forms only 67% of total NPI.

At such, barring sudden and steep deterioration of hotel operations, we are looking at a yield of 7.5% to 8.3% for the next 2 years.

However AHT has several risks.

1) Its debts are rather concentrated over the next 3 years, from 2016 to 2018. Assume a 1.5% increase in the refinancing of 173 mio in 2016. It is going to make more than a dent to NPI since AHT is rather heavily geared.

2) If Tax exemption for overseas properties are not extended come March 2015, then its horrendous although I do not think it will be a issue.

Given I am already rather heavily vested at the moment, I will just keep my eyes open but hands away from this one. Unless, its shares prices continue to go down and LMIR continue to go up, I might then do some re-balancing and diversification while keeping the portfolio size intact.

 

Random thoughts: Excel in Sports CCA and Studies

The pursuit of academic excellence is always on going. I noticed something rather different between excellence in Sports CCA and Studies. I am speaking from my experience.

How do we win in Sports?

Besides innate abililty/ advantage, such as height in basketball and volleyball etc. The two crucial factors are: The right coach and the number of training.

Lets assume the pupils are motivated enough to train. 

There is only this much a coach can value add in terms of teaching methods. During my secondary school days, I learn volleyball from scratch, and I am a shortie, less than 1.6 m during secondary 1. I stupidly followed my "talent scouted" friend for additional training. My coach is kind enough to accept me into the training sessions. 

We trained 4 times a week, with each session stretching to 7 p.m., during the holiday leading up to the competition, we train 6 times a week, from morning till evening.

Practice makes perfect. We spar with seniors, we train and train. There is no real variety in training methods, just drills and drills, and physical training to increase our speed and power and etc. 

In the end, its the frequency that counts.

In teaching, we always share best practice. ICT lesson, experiential lesson, collaborative strategies. These are like the drills, and tools we used during sport training. Yes, different methods have varying effectiveness and some are more effective than others.

But it seems some are missing the forest for the trees, when the pursuit is in the type of teaching, rather than the teacher behind the teaching and the frequency of tool used. The most effective teacher and method might not be a fanciful lesson. It could be, but it need not be. 

Just a weekend thought.

Chill

SI

Random thoughts: What makes me "sianz"

Warning: Whining and LOW energy post.

It is not my busy work. Although waking up at 5.30 a.m. is very tiring, but I can endure, and I will find pocket of enjoyement.

It is not my difficult "clients", I usually try to see things from their perspectives and brush it off as "jianghu... Can't help it", "if it's easy I would not have a job"

What really is sapping is at the end of the day, I keep hearing people grumbles about their life, that they are very "down on luck", they salted vegetable life! Aiyo, really sad lei.

Those who have the most, always felt the least. 

Although I know it is just talking cork and gossiping, it actually really get on my nerves!! 

No worries, I know when to keep my mouth shut when three women are complaining about a maid. 

I have nothing against women. Just find it easier to work than listened to all these unappreciative, energy draining words.

Please, 惜福。不惜福，无福，惜福惜福，人人有福。

My excitement about Adsense approval took a 180 degree u-turn just hearing them lamenting about life for 15 minutes,

Like we are under Japanese occupation, life really that bad huh...

Sigh... Sorry!! Second day in a row liao, and is rather frequent. Really getting on my nerves. I need a outlet. WTF...

Random stories: Today's Tomorrow

Adapted from movie "the edge of tomorrow"

Cory is cursed. He wakes up every morning to the same old day. Today is the day he got promoted, and went home with news of promotion when his wife told him she is pregnant! This is what they always wanted... Until he did the most stupid thing when he saw a shooting star and said to the night sky that he wished every day is like this. 

Now, he lived this day for almost a month now, but the shooting star is the only thing didn't reappear. It is always the same old news, same old congratulation from colleagues.

Today was different though. His wife felt that his husband was not genuinely happy about the prenancy. She sulked and questioned him. "Whatever!! It's not like ... There is going to be a difference!" Cory retorted. "What do you mean!" The wife said in shock. Cory went to the bed, "just let me sleep, I had enough of this everyday!" His wife felt betrayed and hurted.

----------

Serene is really glad she found a new gift. She lied on the patient bed, her loved ones beside her. His husband hold her hand and choked with tears, "why? Why? Why is our time together so short?" She struggled as she said these words, as the respirator makes it difficult to be heard and also to speak:" Today is longer than you think. Do not be upset, I am ....." She choked in pain. Her parents ask her to stop and rest. She smiled. There is always tomorrow. "Don't worry... About me... I am at peace... I am

Happy" Her loved ones marvel at serene strength. The doctor has told them she cannot get past tonight. They felt ashamed it is Serene comforting her. Her dad is the first to smile, "yes, serene is right, let's us enjoy each others' company tonight."

Serene saw the shooting star again, she smiled and say:"Thank you, I am contented, even if tonight is the last night, I am ready."

She got her wish tonight... It was her last night, but Cory will have many more.....