You are here

INSIDE INSIGHTS

Fewer director filings as earnings season picks up

FOR the five trading sessions spanning Jan 24 to 30, the Straits Times Index (STI) declined 2.0 per cent with the Nikkei 225 Index, Hang Seng Index and S&P/ASX 200 Index averaging a 2.8 per cent decline.

This has brought the STI's 2020 decline in total return through to Jan 23 to 1.5 per cent, following its 9.4 per cent total return in 2019.

Sector wise, the iEdge S-Reit Index has gained 2.9 per cent and the iEdge SG All Healthcare Index has gained 9.5 per cent in the 2020 year through to Jan 30.

Share buybacks

There were seven primary-listed stocks conducting share buybacks over the five sessions ended Jan 30 with a total consideration of S$3.7 million, up from the S$2.1 million in consideration for the preceding week.

Singapore Exchange, Stamford Land Corporation and Singapore Press Holdings led the consideration tally.

Director and substantial shareholder transactions

With so many companies reporting full year results this earnings season, the five sessions spanning Jan 24 to 30 saw just 50 changes in director interests and substantial shareholdings filed for 25 primary-listed stocks.

There were five company director acquisitions and three disposals filed, with substantial shareholders filing six acquisitions and five disposals.

Koh Brothers Eco Engineering

On Jan 29, Koh Brothers Eco Engineering (KBEEL) announced the allotment and issuance of 233 million new ordinary shares in the capital of the Catalist-listed company pursuant to the 2018 rights cum warrants Issue.

KBEEL is a sustainable engineering solutions group that provides engineering, procurement and construction services for water and wastewater treatment, hydro-engineering, bio-refinery and bio-energy projects as well as engineering and construction services, specialising in providing building and civil engineering construction and infrastructure works.

This issuance of the 233 million shares has increased the direct interest of Koh Brothers Group (KBGL) in KBEEL from 74.35 per cent to 77.29 per cent.

This has also taken the total interest of KBEEL non-executive and non-independent chairman Francis Koh Keng Siang in KBEEL from 75.25 per cent to 78.08 per cent.

Subsequent to the exercise of 233 million warrants, KBGL holds 218,444,432 warrants entitling KBGL to 218,444,432 new shares in KBEEL, if exercised.

Upon the exercise of the said 218,444,432 warrants only, KBGL would own 1,763,072,039 shares in KBEEL, which would represent 79.53 per cent of the enlarged issued share capital of the company.

The issuance followed KBEEL announcing an attributable net profit of S$5.7 million for its FY19 (ended Dec 31) on revenue of S$290.6 million on Jan 23.

This compared to a net profit of S$5.6 million and revenue of S$328.8 million for its FY18.

The group's net asset value attributable to shareholders increased from S$90.4 million as at Dec 31, 2018 to S$104.5 million as at Dec 31, 2019 mainly due to increase in share capital and retained profits during the financial year.

Cache Logistics Trust

On Jan 28, ARA Trust Management (Cache) Ltd chairman and non-executive director, Lim How Teck, acquired 200,000 units of Cache Logistics Trust at S$0.715 per unit.

The consideration of the acquisition totalled S$143,000 and took his stake in Cache Logistics Trust from 0.147 per cent to 0.166 per cent.

In 2019, Mr Lim had similarly acquired 200,000 units at S$0.720 per unit on Aug 26; 100,000 units at S$0.725 per unit on Oct 29, and 100,000 units on Oct 31 at S$0.730 per unit.

He is also the chairman of Heliconia Capital Management Pte Ltd, Redwood International Pte Ltd and Catalist-listed NauticAWT Ltd.

Mr Lim was previously with the NOL Group from 1979 to 2005, where he held various positions such as executive director, group CFO, group COO and group deputy CEO.

On Dec 12, 2019, ARA Asset Management Ltd and LOGOS Group announced its venture to establish a best-in-class logistics and real-estate development and investment partnership within the Asia-Pacific region.

While ARA Asset Management Ltd will be transferring its entire holdings in Cache Logistics Trust and the manager to LOGOS as part of the transaction, it will continue to retain control of the manager, through its interests in LOGOS.

On Jan 23, ARA Trust Management (Cache) Ltd CEO Daniel Cerf noted that, inter alia, the strategic partnership brings to the table a strong deal pipeline to Cache.

The transaction is expected to be completed by Q1 2020.

Hwa Hong Corporation

Between Jan 22 and 28 Hwa Hong Corporation (Hwa Hong) substantial shareholder Steven Ong Kay Eng increased his direct stake in Hwa Hong from 15.821 per cent to 15.868 per cent.

He acquired 304,700 shares for a consideration of S$103,768 at an average price of S$0.341 per share.

Mr Ong has gradually grown his total interest in the stock from 10.80 per cent on Nov 28, 2016 and 7.38 per cent at the end of 2014.

GL

On Jan 23, GL substantial shareholder GuoLine Overseas Ltd filed an increase in its deemed interest in the listed company.

The acquisition involved the purchase of 485,000 shares for a consideration of S$384,775.

Transacted at an average price of S$0.79335 per share, this took GuoLine Overseas Ltd's deemed interest in GL from 69.01 per cent to 70.01 per cent.

The increases in deemed interest were through purchases in the open market by GuocoLeisure Assets Ltd.

Fuxing China

On Jan 28, CIM Investment Management Ltd (CIM) increased its deemed interest in Fuxing China above the 17 per cent threshold, from 16.88 per cent to 17.10 per cent.

The substantial shareholder's acquisition involved 37,800 shares for a consideration of S$30,157 at 80 cents per share.

CIM is a London-based asset management company with affiliates in Singapore and Jakarta dedicated to managing its clients' portfolios.

CIM was formed in 2005, taking over an existing business with mandates for several global funds managed by James Morton, the founder of CIM.

Its assets under management are approximately US$770 million.

Hong Qing Liang is Fuxing China's co-founder and CEO, and appointed to the board on Dec 19, 2006.

Since co-founding the group in 1992, he has played an instrumental role in managing the business, operations and strategic directions of the group.

Mr Hong also maintains a 55.8 per cent direct interest in Fuxing China.

Fuxing China maintains a diversified customer base of over 1,600 customers in China, and exports its zipper products to Australia, the EU, Russia, Turkey, Korea, Thailand, Vietnam, Indonesia and many other countries.

UOB-Kay Hian Holdings

Between Jan 23 and 24, UOB-Kay Hian Holdings (UOBKH) chairman and managing director, Wee Ee-Chao marginally increased his total stake in UOBKH from 29.54 per cent to 29.55 per cent.

Mr Wee acquired 16,700 shares for a consideration of S$20,374 at S$1.22 per share.

The UOBKH chairman has gradually increased his total stake in UOBKH from 26.51 per cent at the end of 2017.

Mr Wee serves on the board of Haw Par Corporation and UOL Group as a non-executive director and is also a director of Kheng Leong Co Pte Ltd and Wee Investment Group.

  • The writer is the market strategist at Singapore Exchange (SGX). To read SGX's market research reports, visit sgx.com/research.