CWT: Controlling owner mulling review of its business

Singapore

CWT Limited said on Monday that its controlling shareholder C&P Holdings is considering a strategic review of C&P's business and assets.

This "may or may not lead to a transaction involving the company (CWT)", said the logistics provider.

CWT said that Credit Suisse (Singapore) and DBS Bank are assisting the C&P shareholders with the strategic review. But it added: "The board understands from C&P that at this juncture, neither C&P nor its shareholders have commenced any formal process, nor are they engaged in any exclusive negotiations with any party. Accordingly, there is no assurance that such a strategic review will result in any transaction."

The company's 2014 annual report showed that C&P had a direct interest of 31.93 per cent in CWT.

The announcement comes as CWT posted a 14 per cent year-on-year drop in its second-quarter net profit to S$26.2 million. Earnings per share came in at 4.36 Singapore cents for the three months ended June 30, down from 5.04 cents for the corresponding period last year.

Revenue was down 45 per cent at S$2.03 billion, dragged by weaker commodity trading volume in naphtha and a general drop in commodity prices. Gross profit fell 16 per cent to S$75.5 million for the quarter.

For the half year, net profit dropped 15 per cent to S$55.4 million while revenue dived 53 per cent to S$3.9 billion.

"The lower profit for the current half year was attributed largely to the fall in commodity logistics volume, the slowdown in trade services and start-up cost related to a new logistics hub," said CWT.

Net asset value per share was 132.3 Singapore cents as at end June, against end-2014's 127.5.

CWT's directors have approved an "interim net cash dividend" of S$0.03 per share, payable on Aug 25.

In its outlook, CWT said the construction contract for the proposed CWT mega integrated logistics hub was awarded in June 2015. It added that demolition of the existing premises had been completed and piling work would begin this month. The warehouse building is targeted to be completed by the first half of 2017.

The counter closed down S$0.04 at S$2.20, before the results were released.