Thursday, November 7, 2013

Uni-Asia Holdings Limited - FY13 Results on Track to Be Stellar (VR)

Uni-Asia Holdings Limited -
Increase Exposure
 Intrinsic Value S$0.290
 Prev Close S$0.198
FY13 Results on Track to Be Stellar

Uni-Asia Holdings Limited (Uni-Asia) announced on 1 Nov 2013 that it has reaped US$2.1m of gains from the sale of a hotel investment in 4Q FY13. Hence, we are very optimistic about Uni-Asia’s full year results as we also expect 3Q results to be positive on the back of sustained business momentum. The company reported 1H FY13 net profit of US$3.1m, up 79% from a year ago; and 3Q FY12 net profit of US$2.1m a year ago. Maintain Increase Exposure.

Still In the Hotel Operating Business:
The divested investment refers to Hotel Vista Atsugi, which was sold by a 47.7% owned investment vehicle of Uni-Asia for JPY1.67bn (about US$16.9m). The divestment is part of Uni-Asia’s asset management activities in Japan and comes across as a move to realize gains and redeploy its capital. The hotel operating business is unaffected as the operating contract with Hotel Vista Atsugi has been renewed following the sale.

Will There Be More of Such Divestments?
According to Uni-Asia’s 2012 Annual Report, the company has equity stakes in four other hotels, including a wholly-owned Hotel Vista Kumamoto Airport. According to the company’s FY12 annual report, hotel properties classified under plant, property and equipment had a net book value of US$24.4m and investments in unlisted hotel shares had a carrying value of US$2.5m.

Our view is that Uni-Asia is likely to dispose its remaining hotel investments on a piecemeal basis, and only if a sufficiently attractive offer is on the table.

Gains Cement Outlook for FY13:
The gain of US$2.1m adds upside risk to our FY13 PATMI forecast of US$6.9m; and it also quite lucrative, working out to a more than 30% return on the estimated investment book value of US$6.0m. We maintain our forecasts and valuation of Uni-Asia for now, pending confirmation of our bullish outlook by the upcoming release of the company’s 3Q results later this month.

We expect gains from the residential property asset management and profits from the shipping businesses to buttress 3Q performance.

Source/Extract/Excerpts/来源/转贴/摘录: Voyage-Research,
Publish date: 05/11/13

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