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Stocks to watch: Yuuzoo, Dukang, Metro, Keppel DC Reit, Neo Group

Friday, May 29, 2015 - 08:25
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Property and retail group Metro Holdings' net profit in the fourth quarter ended March 31 plunged nearly 83 per cent to S$7.59 million, on the back of lower fair value gains on investment properties of associates and joint ventures, coupled with lower gross profit and an impairment.

THE following stocks had announcements that could affect trading activity on Friday.

E-payments firm Yuuzoo Corporation last week posted a press statement headlined "New Edison Investment Research Report on Yuuzoo Sees Significant Upside on Share Price, Puts Fair Value At Up to S$1.83 In View Of New Signed Agreements". The press release, however, did not disclose that Yuuzoo commissioned Edison to do the research. Additionally, Edison did not make a formal investment recommendation and the S$1.83 price is based on the company's business growing very rapidly.

Chinese spirits producer Dukang Distillers Holdings was issued a "trade with caution" by the Singapore Exchange (SGX) on Thursday, following a sharp 20.9 per cent rise in its share price the day before, despite the fact that no material announcements were made. The surge prompted a query from the SGX on Wednesday with regard to unusual trading activity. In response, Dukang Distillers said it was "not aware of any other possible explanation for the trading". The market is now abound with speculation about potential corporate activity.

Property and retail group Metro Holdings' net profit in the fourth quarter ended March 31 plunged nearly 83 per cent to S$7.59 million, on the back of lower fair value gains on investment properties of associates and joint ventures, coupled with lower gross profit and an impairment. Meanwhile, the group's revenue grew 19 per cent to S$41.72 million due to higher turnover from the retail division as its new store at Centrepoint started operations in Q3FY15. For the full year, net profit rose nearly 34 per cent to S$142.87 million, helped by a negative goodwill of S$57.4 million on recognition of Hong Kong-listed Top Spring International becoming an associated company, as well as from Top Spring's results of S$17.7 million which was equity accounted for in FY15. Meanwhile, revenue was up nearly 5 per cent to S$145.83 million, thanks to the new Metro store as well as the appreciation of the renminbi against the Singapore dollar. At a media briefing on Thursday, Metro's management highlighted that the retail environment remains challenging from high operating costs such as rent, the tight labour market, the rising popularity of online shopping as well as flagging tourist arrivals.

Keppel DC Reit has entered into an agreement to buy the shell and core building of Intellicentre 2 in Sydney from Macquarie Telecom for about A$43.3 million (S$45.9 million). This is the Reit's first acquisition after listing here last December.

Food and beverage caterer Neo Group's net profit for the 14 months ended March 31, 2015 was up 15.7 per cent to S$7.4 million on the back of revenue rising 47.8 per cent to S$77.4 million, largely due to growth in the group's food-catering business. The group's new facility - a centralised kitchen at Enterprise Road which became fully operational in November last year - is expected to increase its capacity and cut costs through consolidated production processes. The group aims to boost its market share of its food-catering business through heightened marketing efforts.

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