Random thoughts: A Sunday family time

Where to go? Cheap and good!

Heard of Changi Coastal walk?

We had a good walk before we go for a sinful but delicious brunch at Changi Village Hawker Center.  

We were treated to more than cheap food. We were treated to a great view.

I took another photo with this as the background but including my wife and son in it. I wrote this in my face book: your company is heaven on earth.

We did went to the nearby Tampines one for a walk. My wife told me she need a spray bottle. I went to Watson and saw these:

The empty bottle costs $ 3.9 after discount, the hair mosituralizer cost $2. It is a bigger bottle too.

Guess which one I would get? But knowing my wife I told her to make a choice. She said get empty bottle as she does not want to waste the mosituralizer but throwing it away. I said ok. But I think wasting $2 is waste too.

Man and woman, or perhaps me and my wife difference. 

What would u get? Empty bottle or pour away the liquid in the hair spray?

Recent action: Accordia Golf Trust

Accordia Golf trust is the only counter I managed to get when market goes tipsy recently. I didn't get it at the bottom, I paid 62 cents but I think it's good enough. I queue for more STE, and was hoping venture go lower, but nope... 

I have 2 bug bears on Accordia. 

1) no injection of driving range as asset by parents.

2) possible currency weakness

The Q1 report however gave me some confidence as despite the vulnerability of weather, it still manage to edge out a decent operating number. If we annualise the q1 payout, we would get >10% yield. The management seems able to manage cost and squeeze out decent return from their golf courses 

FCF was enough to sustain their current dividends, with minimum capex. 

Yen was strengthen instead of weakened as a result of recent Yuan Scare ...

Need not worry about the refinancing of loans untill 2017. 

So, what have u gotten during black Monday and Tuesday? 

Random teaching ideas: P6 market

While the pupils are improving in a upward trend, I seriously do not think I can meet the sales target set by my boss. LOL.

I am quite sure there are 2 pupils in my class who finally got it, their disappointment will be in not getting their A and no longer worry about passing. 

I am betting on vocabulary segment for this weak class. It turn out ok for most people, with the drill and practice etc. 

The oral exam is under the bridge and I hope they did ok. 

Opened ended comprehension is a lost market, I think beside the 3 - 5 who could apply the technques, the rest are really gone... I could try to set complete  the conversation with the words revised so that it reinforced the words. That perhaps will allow me to steal some market.

Writing is about the conclusion weakness and the  lack of vocabulary. Should go into daily spelling of lines !! I will use the holiday to work on booklet 4!! 

Hmm... Think that's about all the time I have... Maybe the comprehsion questions can set from the 课文同步 articles ... MCQ options is painful. Maybe I will just ask them to circle it.  

Include all these in the final exercise of Term 4 for final push to PSLe

May luck be with them LoL

Nice, clearer mind again! Yippee 

SILLY in Vested Teachers

Random teaching ideas: New product launch

Think I will start a new series.

This is purely for me to crystallize my thoughts as I would for investment reflections. Give it a skip when u see such a tag.

P4 results did really badly as compared to competitors. I pushed for another chapter beyond what is required in CA so that I have more time fr Oral practices in term 4. I am
Not sure if the subsequently lack of time for revision is the reason for the poor performance.

One bright girl and a obedient boy suffered a big drop of marks. Surprisingly, those on my "hate list" where I always barked at did reasonably ok.

The bright girl was absent rather frequently and hell that I didn't follow up is a big slap I should give myself. The bright boy seem less motivated and I wrongly assume he should be able to take care of himself.

I have also seemed to have placed the bets at the wrong time. I went for compo writing and comprehension and give less emphasis on vocabulary since this is a high ability class with lesser need for vocabulary explanation anyway. But I think the drill and practice should not be compromised, at least not when nearer to the exam. I could have thought of more games and activities to drill and practice with more fun.

The dilemma is, if I spend more time on these and lesser preparing for the longer term weakness of oral conversation, comprehension and writing, would not the final paper do worse?

I hope my bets are EoY correct and the sales pick up at the end of the year for a Christmas rally that will offset Q3 numbers.

Going forward, since my bets are on for writing and oral. I think I will continue to do that but add the element of vocabulary drill nearer to the exam. It is quite evident that they are writing better than 3 months ago. The conversation framework was caught on by a few, and I think I need to emphasized the link and start to do close oral recording and follow up to capture the market of reading and conversation.

As compared to failed comprehension attempts, more pupils are passing it. Will continue to expand this market. The rewriting skill of comprehension need to be work on and I will do gallery walk for this component and break up the SPRC framework for different groups.

In terms of vocabulary, beside guess the pic game, which the pupils are already sick of, I could add mermory game with questions.

I could also ask pupils to form questions using the rewritten sentences and organized an competition to get them to learn comprehension in a fun way.

The bets are still in the few markets segment I am eyeing by I am not sure if I will be caught with the same problem of not having enough time.

Thanks goodness that Psle is over earlier, I  will spend week 4 onwards on additional supplementary classes for this P4.

Hope sales get better. P6 is another product for another post another day. Time to do some marking...

Blogging is therapy even in area of teaching... My mind is clearer now ... Thanks...

Silly in vest teacher

Random thoughts: Creative technology

I read up on Creative Technology AR for the past 15 years. I have wanted to do a case study but decided to tag a random thoughts to it because I thought there are more reflections than analysis.

First, when I google "why did creative fail", this blogger gave the best answer. He seems like a insider of the tech industry and I shall

Not parroted his views on the products. 

https://erictayet.wordpress.com/2013/06/01/creative-technologies-missed-opportunities-or-lost-cause/

However, at his hey days of late nineties, Creative did diversfy. It is a capital Venture company, investing on small Tech start-ups that look very promising with over 100 million profits in just 1 year. Thereafter, it is a roller coaster ride.

Even within the core audio market, there is clear market segment that creative want to capture and that is one period of time they were into the Internet business, broadband etc. 

Also, unlike NOL which is slow in getting mega and green vessels and expanding at the wrong time. SIM did correctly spot the  trend of personal entertainment devices, which is like known as MP3 player.

So what went wrong? Was it possible to spot it earlier? If u look at Creative numbers prior to 2004, the FCF is super high and beautiful albeit volatile, but never negative. So if u think only debts kill a company, u like me, could be placing too much faith in numbers such as FCF. 

When its operating numbers start faltering, creative place big bets on ther personal entertainment devices market, believing that as first mover, they can capture that market. The segment revenue grow very strongly as it challenge Apple and it became the biggest segment of revenue generator but it's margin became raZor thin and subsequently become loss making.

That could well be the first red flag that "outsider" could spot without hindsight.

After looking at Creative and look at Venture, I read it's AR all over again. I think the remark of moving to higher margin product is "bullshit" but the actual fact is their major customer in printing and imaging is not doing as well due to  competition and is starting to rely on in-house capability to produce. Nonetheless, that Venture never show a negative operating profits and did diversfy successfully means it might have avoid death. But was it just economic bad times? Not, I do not think Venture could go back to days where it could be a sexy "grower" again even if economy do turn very quickly. It might however be able to grow slowly. 

This reading exercise highlight the risk of 1-2 major customer/ segment/ where if u fail, we could well be seeing dogs. 

Then, it's sembcorp marine going the way of Creative? Was it a economic bad time or was it going to be killed by competition. I am hell cutting loss when marine announce Operating loss, even for sembcorp industries.

So, if u are looking at UMS or namlee who is highly dependent on 1-2 major customer, it pays to look at the customer closely. 

------

When I am Driving to see a doctor today, I have this thought. I am like creative... 

I used to be the "golden boy"

But have since lost some of the mojo judging by my pupils' results. 

So how to prevent a Creative? Diversfy and capture new markets fast!! I better try new ways of teaching and see the results first! Different pupils are like consumers, what worked in the past seriously is not working well now, and my hybrid method of changing and improving my teaching at the corners is seriously not working well. 

I have 2 new products, and 1 new production method, I only have 2 more months to show results. Hope reception is good. 

随心笔：一个人潇洒，还是一家人生活

最近，和一个朋友聊天，他对我说，他选择一个人的自由，所以以后会承受孤单，因为他自私地生活。

一个人有什么罪？

如他说的，是一种选择。

选择了潇洒，放弃了天伦。

有家庭的人，晚年不一定幸福，没听过败家子吗？

一个人独处，不一定寂寞。

最要不得，是有了家庭，还完完全全想着自己的潇洒。

Random thoughts: practicing Zen through markets volatility?

This post is kind of inspired by SMOL.

He mentioned he practized Zen through the volatile market. Of course, as a trader, his roller coaster ride would be different from mine. Mine is little big club thrill ride. Only for those below 7 years old.

My thought is: if markets really give u so intense a emotion that it became a zen moment, we have to really ask how long we have been investing and how many cycles? 

I think 2015 is really shaping up as a watershed zen moment for me. From my mother illness, to the inferiority complex at work, I think I can going through the mill now.

I used to get upset when my MIL has problems with my maid. Now, I just zen through.

I used to think how unlucky I am to need to cope with caregiving and work, until I realized most people nearing 40s had that experince in one form or another. Maybe they dun blog.

I am really talking to people. Listening to their stories. I am also listening to my emotions and my loved ones more. 

Zen... It comes and go, the state of equilibrium ... Is but a passing cloud... The sufferings are more intense like standing under a rain, but it will stop and change.

Under the rain, we owned it to ourselves to smile and open up the arms. Cry or smile, and enjoy getting shit/ or soaked. Instead, we could curse, swear and whined. If u have someone under the rain with you... That's more complicated. Do u usher her to shelter for fear of her getting sick? Or do you ask her to enjoy the rain? 

Walk with her to where she go, stupid! Enjoy holding her hand be it in the rain or rushing for shelter. Seize that moment of love to build up your base. Feel the hand. The cursing is music... Fixated on the rain ? Change ... Is zen 

I cherish every zen moment, it comes after a difficult morning. 

  

Are u following through your plan or shifting goal posts

I have a plan of buying when market correct 10% and more when it hits bear of 20%. I have enough ammo to last a 30% bear. If I consider my wife ammo, maybe a 40% bear too, but I believe that will put a stress on her confidence and perhaps mine too. 

Pardon me, but this post is not about me. No, I am not trumpeting anything, in fact, if market falls further, most probably there will be many laughing at me catching falling knives. 

But the point I want to make is, it is easy to do a paper exercise of saying when market goes down x I will buy Y, and when market goes down x+10 I will buy Y+20.

When it happens, there will be many noise in the market. "What happen if the 2009 bear has no more legs",  "maybe my first round should be when market correct 20% instead", "many are predicting volality to increase, maybe I should wait for dusk to settle"

While some reflections might be valid, if not action is carried out, what good is a plan? Chances are if u froze at 20% fall, u will freeze at 25% or 30% fall. If your intial plan is always "no fat bear no hunting", and you are sticking to it, then you are the man. If u are shifting goal poles, then ... 

Actually, when u see/ hear people doing a roti-Prata, aka flip flop in their plan and action, u know finally "fear" is striking the market. 

It's not so easy to buy when everyone is fearful, isn't it. Just a few fearful and then followed by a growing number of doom talkers will make it harder?

Looking back, why am I so foolish to keep accumulating? 

I have no idea how much longer or deeper the market will fall. But before the fall, I already knew:

1) there must be some "reason" for a bear to happen. Think Euro Scare, and Japan Earthquake. I hardly read any convincing reason except China Economy slowing. 

2) I dun know if it will fall 20% or 40% or 60%. 

3) I am confident of av. Price should at least be fair price when market returns to normalcy whenever it is. I might not be able to make a big bear killing, but I think the dividends should be the trophy even if after a cycle, the price is at the same place.

An eventful August!

Hello people! Seldom I got a chance to relax on a Sunday. PARDON my many posts. I saw B and Rolf doing this and shamelessly decide to board the bandwagon. 

I brought back CMPH at 97cents. With the span of a short 1 month of August, I have bought, sell and bought again. I bought when many bloggers are repositioning after the not so clear cut acquisitions of 3 toll roads and the threat of dilution. I decide to give track records of  management the benefit of doubt over my doubt. 

I (include my wife) also bought 

STE at 3.15 and 2.91

Ascendas Reit at 2.28

MIT at 1.46

SSC at 27.5.cents

Sembcorp Industries at 3.85

Gold UsD at 1040-1050

Not thinking of selling anything yet. But will be more selective going forward. 

Looking at the following In order of pereference:

1) Accordia Golf Trust

2) Singapore Shipping 

3) Lippo Mall Retail Trust

4) STE

5) CCT

6) Ascendas Hospitality 

Random thoughts: A conversation with my wife who is jittery about the market

A conversation with my wife who is feeling a bit jittery just a day after buying. LOL. Some of the conversation are edited for easier reading. For anyone who might be feeling a bit unsettled.

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

Wife: Are we buying too much? Shouldn't we have some cash as spare?

Me: huh? When u told me u have X amount of cash and I ask u if u are comfortable with having X\2 as investment, u say ok. Now we are only X/4 vested. U are just buying back what u sold off earlier. 

W: ya, but I buying more than selling. I thought I will sell some before I buy more?

I: No, that's not actually what I have in my mind when I say building up a base where dividends will start to grow to a level to which we might need not to work or become a significant income supplement.

W: aiyo! How is that possible? Stop dreaming.

I: why is it not possible? Maybe not in the short term, maybe not early retirement, but Defintely possible if u are thinking about it paying for our overseas trip when we are older.

if u want to buy sell buy sell for capital gain, then that is gambling because I dun have the skills for that. But I do have a plan for a longer term of things and what to do even if market collect another 15%.  

W: mum told me even ST engineering can go to $2.

I: why not? It can go to $1.5 for all I know, that's why I always ask u to buy stronger companies that keep paying dividends. We might be far from getting the bottom right, but look, ST is giving 5% yield now, with a track record of stable or growing dividends, assume u hold it for a decade, u have get back half your money, and even if we cannot benefit from the bottom, I believe our  av. Price should not be lower than the fair price when market eventually recover.

W : when times are bad, where got dividends, even if they dun collapse?

I: with the exception of Sing Shipping, all companies you bought are blue chips with unbroken dividend records. If they fail, Singapore is in a really bad state. Also, we are not buying a single company with more than 15% of portfolio, we can still do ok even if we are wrong with 1 company and it collapse. 

W: (not convinced look.)

I : look maple industrial parent is link to temasek, Acendas is link to JTC, what are u afraid of? Anyway, I told u not to look at the market after u buy, just trust me to ask u to buy and sell

W: a.. Our son birthday ... ....

I: ( thoughts: talk about flicked minded... zzzz) 

Capital commercial Trust

This trust is interesting. 

Growth areas are visible with Capital Green, rental revision.

There are 4 risks.

1) Interešt rate hike

2) Falling rental 

3) Rising Vacancy 

4) Over-valuation

To know if growth can offset the risks, let's do some calculation.

Capital Green has committed rent of at least $11. Let's take the minimum.

Assume full year 2016 of contribution, that is 74.7 mio of contribution. 

Assume they buy the remainder 60% stake at late 2016, so 2017 will be 112mio of rental rev.

Total rev growth for 2 years about 260 mio.  Assume margin of 0.8, Net profits should in the range of 200 mio

Most of the interešt cost is fix, so the risk of hike comes when it is refinancing. Assume 0.5 interešt in 2015, further 1% in 2016 and 2 % in 2017. Total increase in finace cost will be 24 mio cumulative without new loan to fund Capital Green.

Highly unlikely that The trust will take a 1 billion loan at one go to fiancé capital green given it always spread out its debt obligation, but for simplistic in calculation,  again assume 4% interešt cost (highest of all its loan), it will be about 40 mio and total finance cost will balloon to 64 mio.

Growth more than offset interešt risk. 

Next operating weakness.

It's expiring rents are lower than current rents. And it is especially evident for Raffles City. (As pointed out by fifth person report)

In fact, income from joint ventures, which is mainly from Raffles city has been growing nicely from a year ago due to positive rental revision.

I think the odds are in favor of positive rental revision or at least status quo. Also, my experince with MIT and A-reit is it's entirely possible to have rental revision at above current rental rate. Given there is a good buffer now, I think we are quite safe from falling rental. 

That we have the issue of high vacancy. I initially wanted to talk about their tenants, but my gut speculation is that unlike retail  or industry, where there might be some stickyness due to customers' familiarity or transport cost of shifting heavy machinery, I think office shifting/ downsizing should not be too much of a hassle if the savings is worth it. So yes, this is one risk that might show itself when the supply gut come on in 2016.

Next, valuation risk. It's priced below NAV, but I believe that hardly provide any MOS since the cap rate is of the range of 4%. (See B post, I shan't parrot)

Also, I think distribution should be a main factor of valuation. So what price is a good price? I would think 7% yield would be decent taking into account its possible growth, quality asset, prudence capital management. That would be $1.2. It is not actually a far target given how badly US market is falling and te expected knock on effect on Singapore Market. It might NOT be a price that is bear - proof, but it should be a reasonable longer term price should u have to wait out a bear and collect dividends. 

Lastly, since Capital Green is so important in terms of growth for the trust. We might want to look at it slightly closer.

I believed capital green would be bought by 2017 to provide the staggered growth for the next 3 years. Also, the longer they wait, the higher the compounded cost. 

I made a simple minimum cost of acquisition  based on 6.3% compounded annually of development cost of 1.4 billion at 2017. With 60% stake, it would cost 1.01 billion. But would it be yield accretive? Given the earlier calculation of 112 mio annual rental, the yield is 10%.

It is Defintely not going to be 10% since the cost of Capital Green is unknown, and we have not factor in other expenses. But if the minimum yield is a low single digit, we can safely conclude it will be not a good deal. So again, we are fighting a losing battle where odds are stacked heavily against us.

Although the trust has exposure to Malaysia property, but since it contribution is insignicant, I decide not to go into the nitty gritty of calculating currency risk. 

Conclusion:

Will I buy? I dun know, Defintely on my watch list. I dun really like leverage yield play in the current interest raising environment.

Random thoughts: Do you have a Joint name for your trading account

Do you have one?

Why did I ask?

My MIL told me it is difficult without a will, to pass on the shares to the next of kin, if she passes on. I heard of the trouble before and she told me that all we need is a form.

I ask my broker for advice, and this is what he told me.

It is indeed very troublesome if one passes on without a will.

He told me one way to get around this is to get a joint account for trading.

When I passes on, my wife will have access to all my shares.

I thought this is important, and I will most probably start opening a joint account with her.

I am sure many of us, at certain point of Market, we will have significant amount of cash in equity. What happened if you passes on then? I guess, the amount of cash in equity could be well above 50% of your liquid assets.

We all invest for our loved ones too, one way or another. so perhaps it is time to think about this?

I tried to google for more information, but I really find nothing really useful. There are some pretty good information about will making but not how we handle our CDP shares if we passes on.

If anyone can share a helpful link. It would be most useful.

Random thoughts: Words that turn around and stared back

I ask a colleague the following questions. 

1) Do u feel excited going to the classroom and seeing your pupils.

2) Do u sometime look at them and feel "so cute!" Or look at the one or two pupils who are from FAS, and say I must do something for them.

3) Do they pop up in your mind when u are on your way to school, or sometime appear just before you sleep? 

Very obviously, her answer is "no" without her saying it. I told her I have no doubt on her capability to deliver but seriously think her passion has died and it is really affecting the way she conduct her classes. 

I told her that I think the arrangements we had for the past year to help her, reduced workload, buddy colleague are not working because all the basic ingredient is missing.

She looked rather stunt by my bluntness since I was very patient in the past 1 year. 

She told me she will think about it and she need time to search. I am not sure if she got what I said. 

I ask myself the same questions but change the subject from

"Pupils" to 

Parents

Wife

Son

Myself

I realized I have "no" for answers for some of The options too. 

Are u shocked about your own answers too? 

Is not about time, spending time... 

Just like its not about the method of teaching, rewards given or the resources a teacher has, if the heart is gone, the lesson is gone, most of the time. 

If your loved ones do not appear in your mind, and your heart dun scream when u see them... ...

Time for deeper search ...

随心笔：坦然

水从手指间渗了出来。

尝一尝，

水是清的，手是凉的。

为何，非把水带走？

火照耀四周，

房间温暖了，

谁记得，

火堆下的柴。

选择遗憾？

体验荒诞，

走？走下去。

Random thoughts: Singapore dream and mine

I guess many of us were ask what are our Singapore dream for the next 50 years.

I thought about it. I would like a nation with confidence and love. It's people not worried about competition and yet gracious about losing. Productive and innovative workforce that placed relationships and family at the forefront. 

I understand whatever we have today is built upon the fact that our economy is vibrant. We do not have a choice to live it like hermit, or take a different pace like Icelanders or sorts. But they doesn't mean we have to pursue economic growth at all costs. 

Now, since I am Singaporean, am I part of the future or the opposite?

Clearly, I am not as confident. 

I ask myself, what were my dreams when I am younger. I realised I have pursuit my aspiration but never my dreams. My dream is just cheap castle building. 

My aspiration is to be a teacher. I remembered when we are getting our 'o' levels, and I told me friends I wanted to be a teacher, one of them said:" siao! You think properly hor, you can study one, don't waste your results."

I have no regrets teaching. I remember during my army days, I sit by the marina river, looking at the financial buildings. I thought to myself, I want one of the building to bear my name or company name next time. That is my cheap dream, because I did nothing to pursuit that.  It's not about failing, because I didn't even try.

In recent years, I did have a dream in FI, although the specifics of it did change, I didn't give up on it. 

Will FI help in the bigger Singapore dream of confidence? Maybe. I don't know.

Now, I just want to watch my son grow up properly. 

Today, I went to the singapore Orchid Garden, it is the most beautiful garden I have been, beating even Gardens by the Bay. It is always there, just never discovered by me. To think we travel far to Japan to see lavender during our Honeymoon when we have a orchid paradise at our backyard. 

I wish to find my garden of Eden too. 

Happy birthday Singapore

Lee metals Review -- Poor results expected, but not panicking yet

Lee metals report a poor set of results.

I am not panicking yet.

The poor comparison of YOY results is due to Lee metals locking in Austville profits in 2Q in 2014.

Without this one-off item, the fall in profits would be less than 30%

Dividends was maintained.

After the bumper years of 2013 and 2014, I expect 2 cents dividends from Lee metals for the rough years ahead.

QoQ profits is relatively stable at 4 mio, or close to 1 cent EPS.

To maintain dividends, Lee metals need to pay 50-60% of earnings, assuming the 1 EPS can be maintained. I predict Lee metals would pay either 1.5 - 2 cents dividends in total for 2015.

Next, with the exception of Sin Ghee Huat, which is in the niche Nickel steel segment, Asia Enterprise, Hupsteel reported or going to report loss for the current quarter. BRC is still turning a profits but the fall is more drastic compare to Lee metals. It reinforced that Lee Metals is the alpha company in the Steel business. Nam Lee Pressed Metals Quarter report was not out yet.

However, this is no catalyst in the near time for this company.

Just have to feed on dividends.

I however, do know that the steel market is going to the dogs for years, mainly due to the fact that China is over producing and under consuming (Property sector in doldrums)

CCC for 1H 2015 is still high at 127 days. The same as 2014.

The high CCC however is a risk for impairment or rundown of inventory.

Random thoughts: 2015 1H review of the Mind of investing

This review is not so much about the Method of investing, but rather the Mind. 

The market corrected 10% and has stable, at least for now. This is finally a meaningful correction for quite some years.

When we talk about the Mind, we ask about discomfort. The really weird thing is I am not yet uncomfortable about the real paper loss, but felt rather unhappy seeing  Venture going up and up in this correction.

The mind is more at peace with correction since I have a fair bit of cash. 

I also thought I will be rather happy if the market goes up since I am also vested.

There are counters that went up and up after I sold them before but I hardly feel anything. I wonder why? CES is sold at 70 cents and YZJ at 1.14 when the news of lawsuit first emerged.

Why is VENTURE so special? Since this is not a Method Exercise, I will skip it.

I think beside the target price and business operation analysis, the next question we really need to ask before we sell is: what is the alternative? 

Also, we must also ask ourselves if we will be ok, if we are right about the operation and earnings but wrong about price movements. If we buy, are we able to very relaxingly say "just hold and wait lor" if we sell, can we just say:" find another lor, it has some inherent risk too what..."

I need to emphasized this is not about not sticking to buy and hold, it is about making better buy sell

Decisions that sit better with the Mind. 

Q2 results review of Sembcorp Industries

I choke on the Sembcorp cigar puff. It did bounce with a relative better results as compared to expectations. But I bought at $3.85, thinking it was touched a low. LOL

Sembcorp Utilities

In my previous post, I mentioned that Sembcorp Industries should be better QoQ. The numbers did not disappoint, and the overseas utility did offset somewhat the continued weakness in Singapore Market.

The fall could have been much worse if the overseas market did not pick up the slack.

However, the numbers are puzzling. Given that overseas net profits increase QoQ, one would have attribute the increase of the main contributor would have to be India, the only new expansion from Q1. However, Management only attribute the higher turnover to the "India factor" but not net profits. If you look at the breakdown of India and others Net profits from Q1 to Q2, it is the Middle East that has profits increasing.

Going forward, Singapore market is going to get worse with "Vesting contract levels have fallen from 40% to 30% in 1H2015, and will fall further to 25% in 2H2015"

India 2nd Power Plant and soon China Biggest Water Treatment Plant Changzhi will come online soon 

This quarter results makes me wonder how long the gestation period of this new projects will be to bottom line. 

But in the longer run, I am satisfied with the Utility segment expansion. 

Marine

Marine is definitely going to do worse. Delay in deliveries is actually the better option that is happening as the worse is Brazil Sete cancelling its Drillships orders.

Sete update of its drilling ships and projects report is here (announced on 30 June):

http://ri.setebr.com/enu/58/Rigs%20Physical%20Progress%20-%20Jun%2715.pdf 

You can only find 4 out of the 7 drill ships order in that update. The other 3 drillships have not start construction, According to management, "more than 80% of the first Sete Brasil drillship has been completed, followed by 74% for the second, 60% for the third and 30% for the fourth. These projects remain cash positive." Given that the first ship is already delayed, the last 3 orders are really hanging in thin air.

Just on 15 June, they still have an update of 29 rigs or drillships. However, it has already being reported Sete need to restructure to access bank credits and only 14 rigs or drillships will be built and another 5 will be co-owned. 

The million dollar question is which project will be axed and will sembmarine drillship be axed?

 From the chart, I look up the various operators of the drillships.

Odfjell Drilling:

http://hugin.info/157018/R/1923447/689760.pdf   page 7, there is no information on delay in construction or downsizing or cutting of cost.

However, the operator still go back to Petrobas. So Petrobas's fate really affect many.

Seadrill:

A big mystery here. As you can see from the above chart, 3 drillships will be operated by Seadrill. But the whole of seadrill fleet (even those under construction) did not include any of the 3 ships.

I thought they might have change the ship name. So I look up the details of the drillships one by one

http://www.seadrill.com/our-fleet.aspx

They are mainly constructed by Korea yards, and mainly Samsung Yard.

Perhaps construction has not started? But Camburi has started construction last year. 

This is a black hole of information. 

In the short run, the 7 drill ships will be a curse, as BOth Odfjell and Seadrill talk about delaying some of their newbuilds.

In the longer run, how long this oversupply of oil will last is everyone guess. Although Seadrill believe the replacement of older rigs for better specs ones will continue. 

Conclusion

I have accumulated, but get ready for rough ride.

Not for the faint-hearted.

This should well be my last accumulation.

Random thoughts: The work ethnics of the older generation

My father had a tough life bringing the three of us up. I remembered the days as a hawker, we slept at 1 a.m. After clearing up the stall and he wakes up at 7 to prepare for the next working day. He and my mum tells me to study hard, so that I need not work so hard when I grow up. 

I didn't  like the job of a hawker too. I find it dirty, having to clear the leftovers food every night.

Fast forward to now, I am a successful "office worker", in my parents' eyes, staying in the comfort of  air - con room as we work. ( not true for teachers )

Readers will know I tend to whine and complain ocassionally. But recently, I really have to take my hat off 2 colleagues. Both nearing retirement age.

We are all overwhelm with work but these 2 seniors have more projects at hand than me. One of them told me she has been sleeping at 2 am for the past few weeks. 

Wow. Staying up till 2 am to blog and do what we like is a totally different thing from staying up to clear deadlines.

Another colleague and I were in charge of the running of the examinations. It was a lot of work and she being the head is coughing badly for the past week. When the exams are over, I thought she would take a short "MC".

Nope, her voice is coarse now with all the coughing and she still reports to work. 

It is definitely not because of money. She has several properties under her name and one of which is a landed property. Humble, she did mention she can retire anytime.

I also know of teachers who are passionate and have a calling to do their best for the kids. But the work we are doing is hardly energizing and it's taking a lot of time away from the pupils. 

Why are they doing this if not for passion or money? 

I think it's sheer grit.

Whether that serve any higher purpose  I have no comments, but they sure earn my respect.

But I would not want to emulate them

With all due respect. 

Random thoughts: A tribute to SG50

A broken family.

A unwanted child, turn rebellious, out to prove others wrong.

Against all odds, he grow.

Competitive, always spoiling for a fight. 

A fight to win.

Pragmatism, is his character.

Meritocracy, his value. 

With nothing, he became rich.

After 50 years, the search for soul began in Ernest.

Who actually am I?

Why did I work so hard for?

Everyone growing man get lost at times.

The future is the search inwards.

The future is the connections and bonds with family.

Confidence for another 50 years. 

Commodity super down cycle? - Part 1

Noble Group crash of more than 30% in a week is the trigger for me to look commodity again. I have initially wanted to take a punt on Noble Group as I thought even with the write down on its Yancoal assets, it is trading at too heavy a discount to NAV. But the search lead me to somewhere else.

Some pictures first.

With the exception of First Resources (The third is Olam, Name got cut off), all counters have experienced a drop of at least 50% from its peak.

Golden agri and First resources were on my radar, both show a deterioration of earnings due to the weak CPO price, but First resources was incredibly resilient. It was better plantation profile and the "growth" in production might be the reason why the company holds up well. The growth in production would have somewhat offset the weakness in price.

I then went on to take a brief run using Bloomberg on the companies earnings, balance sheet and cash flow. Do note that Bloomberg numbers are not always 100% accurate, but it serve as a good preliminary screen nonetheless.

I was then drawn to the fact that Wilmar has rather resilient positive FCF, and given the bulk of Wilmar's earning still come from palm oil. I decided to look further. I check the ARs Wilmar and the +ve FCF is correct. They have also start to reduce their debt. 

Going back to the previous point about plantation profile, while Wilmar did not have as young a profile of plantation as First resources, it is still younger than Golden Agri and they deliberately show the profile of 15-17 years old (Still prime but going beyond 18). 

First picture belong to First Resources,then Wilmar and lastly Golden Agri.

I also saw clear possible "growth engines" in terms of the consumer production (Its profits has been growing for the past 5 years), especially since they have now acquire Goodman Felder. The impact of this acquisition will show in the 2Q.

Given that Market "might" be correcting in the weeks ahead , possibly due to worsening of Malaysia's Situation having a knock on impact on Singapore, I decided I will read up more on Wilmar and will update accordingly when my research is done. 

Only bug again is the low dividend of 2.5%.

Random thoughts: A great place to see NDP fireworks

The meadow at Gardens by the bay.

I hate crowds. The big grass patch at the meadows is spacious enough so that the next group of family having a pinic is at least several meters away.

We had a dinner cum picnic as my family watch the fly past. 

The super structure trees also treated us with a light show as we wait for the fireworks. 

The toilet is nearby.  

View is nice. 

Will bring my parents there again next Sunday.

The fire works is slightly blocked by the sands, but for the breeze due to the big space available and also the big space for me to stretch my legs. I am

Willing to make do with a lesser view