Author: YiStock | Latest post: Tue, 7 Mar 2017, 10:23 AM
Author:YiStock | Publish date: Tue, 7 Mar 2017, 10:23 AM
The last article i wrote about frontken mentioned that Frontken is using Profit Guarantee to buy time for the Taiwan Ares Green semiconductor related business to grow. http://klse.i3investor.com/blogs/frontkn/82229.jsp
Below i give a follow up again on frontken latest development using full year 2016 data ON REVENUE:
Semi-con
Oil & Gas
Frontkn
total
total
Revenue (mil)
Twn
Sg
My
Phi
Indon
China
2013Q1
13,948
29,732
18,027
7,205
3,637
300
563
2013Q2
16,197
27,670
15,156
8,379
3,068
384
683
2013Q3
17,839
33,496
21,049
8,652
2,843
358
594
2013Q4
17,746
40,471
25,516
9,416
4,403
697
439
Total
65,730
131,369
79,748
33,652
13,951
1,739
2,279
% from total biz
33.35%
66.65%
2014Q1
17,915
31,791
17,046
10,753
3,017
758
217
2014Q2
20,350
55,589
13,796
38,841
2,693
259
0
2014Q3
22,807
63,028
14,490
45,731
2,807
0
0
2014Q4
31,195
77,777
21,666
52,650
3,028
433
0
Total
92,267
228,185
66,998
147,975
11,545
1,450
217
% from total biz
28.79%
71.21%
2015Q1
23,456
55,765
13,205
37,905
3,811
844
N/A
2015Q2
25,913
42,829
13,318
25,173
3,815
523
2015Q3
29,417
41,773
14,877
22,221
3,930
745
2015Q4
30,254
38,718
12,410
21,548
4,289
471
Total
109,040
179,085
53,810
106,847
15,845
2,583
0
% from total biz
37.84%
62.16%
2016Q1
26,848
32,449
9,688
17,779
4,371
611
N/A
2016Q2
30,714
33,317
11,383
16,872
4,207
855
2016Q3
33,785
31,405
9,931
16,350
4,328
796
2016Q4
36,908
39,763
15,966
17,532
5,482
783
Total
128,255
136,934
46,968
68,533
18,388
3,045
0
% from total biz
48.36%
51.64%
Key obserbation:
(1) Taiwan Ares Green continue to gain the Significant Growth.The revenue has grown from RM 65.7 mil (2013), RM 92.3 mil (2014), RM 109 mil (2015) and RM 128.3 mil (2016)
(2) For oil and gas segment, the revenue remain stagnant. With recent positive sentiment in oil&gas industry, i expect the segment to break even. That's what i hope so that it will not drag down Taiwan Semi-conductor linked business. ON OPERATING PROFIT:
Semi-con
Oil & Gas
Operating Profit (mil)
Twn Total
Oil & Gas Total
Sg
My
Phi
Indon
China
2013Q1
787
1,547
819
518
516
-278
-28
2013Q2
2,854
-1,814
-523
-1,215
365
-175
-266
2013Q3
3,380
-364
945
-379
348
-926
-352
2013Q4
2,226
803
1,232
-243
646
-242
-590
Total
9,247
172
2,473
-1,319
1,875
-1,621
-1,236
% from total biz
98.17%
1.83%
2014Q1
2,303
955
-115
795
564
329
-618
2014Q2
3,532
163
-1,996
2,914
377
-563
-569
2014Q3
3,823
5,227
973
4,065
369
-3
-177
2014Q4
4,395
5,687
2,361
4,709
317
-181
-1,519
Total
14,053
12,032
1,223
12,483
1,627
-418
-2,883
% from total biz
53.87%
46.13%
2015Q1
5,042
5,971
-434
5,571
783
51
N/A
2015Q2
5,819
-4,076
-1,644
-2,932
757
-257
2015Q3
7,069
-4,842
1,043
-6,415
690
-160
2015Q4
2,652
911
255
229
824
-397
Total
20,582
-2,036
-780
-3,547
3,054
-763
0
% from total biz
110.98%
-10.98%
2016Q1
2,727
-672
-4,192
2,934
731
-145
N/A
2016Q2
6,620
1,913
-881
1,972
821
1
2016Q3
8,363
803
-1,265
1,213
796
59
2016Q4
6,220
7,137
5,202
1,080
862
-7
Total
23,930
9,181
-1,136
7,199
3,210
-92
0
% from total biz
72.27%
27.73%
Key Observation: (1) Taiwan Ares Green Segment has achieved another significant year with RM 23.9 mil operating profit. A growth of 16.1% from 2015.
(2) The oil and gas turn profitable expecially Malaysia region and philippine region has also doing well. To recap on the deal with purchase TTES in 2014, there is profit guarantee of RM 8 mil (Frontken has 45% stake in TTES), therefore, the RM 8 mil x 0.45 = RM 3.6 mil for 2014 & 2015. This profit guarantee should has been recognised in the respective year. The RM 7.2 mil of operating profit in 2016 MAY have signal the turn around of oil and gas segment in frontken.
TTES has major customers such as Petronas Carigali, ExxonMobil, Talisman.
(3) As of 31 Dec 16, The company has RM 95 mil CASH in hand.
PARAMETERS
31/12/2016
Revenue RM
261,844,000
COGS
217,952,000
Gross Proft
43,892,000
Net Finance Cost
1,147,000
Profit Before Tax (NOPBT)
33,344,000
Tax Amount
6,059,000
Net Profit After Tax (NOPAT)
27,285,000
Foreign Translation Gain /Loss
6,723,000
Earning Per Share (EPS) RM
0.0191
Dividen Per Share (RM)
Outstanding Shares
1,048,103,000
Share Price 31 December
0.235
Market Capitalization
246,304,205
Enterprize Value = Market Cap + Debt – Cash
264,040,205
Fixed Asset (P,P,E)
152,066,000
Total Non Current Asset
189,429,000
Good Will/ Intangible Asset
33,761,000
Trade Receivable & other receiable
101,199,000
Inventories
10,976,000
Cash/Short term investment/ Deposit
94,618,000
Total Current Asset
218,334,000
Total Asset
407,763,000
Current Liability (including dividend,trade payable etc)
86,933,000
Trade Payable+Other Payable
73,254,000
Non-Current Liability
25,421,000
Total Liability
112,354,000
Share Capital
105,344,000
Share Premium
13,582,000
Other Distributable Reserve
Retained Earning
Total Equity
295,409,000
Profit/ Earning Before Tax
33,344,000
Depreciation
17,193,000
Amortization
0
Earning before Interest & Tax (EBIT)
34,491,000
EBITDA
51,684,000
Net Cash from Operating Activity
44,302,000
CAPEX
27,731,000
Net Cash from Investing Activity
-47,861,000
Net Cash from Financing Activity
-18,280,000
Net Increase / Decrease of Cash
-15,839,000
Cash and Cash Equivalent at the end of period
91,315,000
Book Value/ NTA per share
0.2496
Cash Per Share (RM)
0.0903
Analysis
Company:
Par Value:
Year
2016
Revenue Growth, > 10%
-6.68
Net Profit Growth, > 30%
186.97
EBIT Growth, >30%
97.18
EPS Growth, >30%
389.74
RATIO
Net Profit Margin, > 0.08
0.10
EBIT Margin, > 0.2
0.13
Current Asset/ Total Asset, >0.6
0.54
Non-Current Asset/ Total Asset, <0.4
0.46
Current Ratio, > 1.8
2.51
Debt To Equity Ratio, <0.5
0.38
Interest Coverage, > 9
30
DUPONT's ROE, >10%
9.24
Return of Invested Capital (ROIC), >10%
14.29
Free Cash Flow (FCF)
16,571,000
Cash Per Share (RM)
0.09
VALUATION
PER, <10
12.30
PE/G, <1
0.07
EV/EBIT, <8
7.66
EY, >12%
13.06%
Price/Book Value, < 1.5
0.94
For a penny stock and with growth prospect, Frontken, i will continue to track.
Cheers,
YiStock
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