Background:
FIBON is mainly involved in chemical, electrical and finance
business. Its business base covers 28 countries in 6 continents across the
globe. The Company is engaged in the formulation of advanced polymer matrix
fiber composites, manufacturing and sales of electrical insulators, electrical
enclosures and meter boards.
4Q14 earnings
increased 13% to RM1.16m
FIBON recently announced its result on 31-July 2014. Although
FY14 earnings declined 18% YoY to RM4.00m, one should not miss it that FIBON’s
4Q14 earnings actually up 13% YoY to RM1.16m. The increase in 4Q14 profit YoY
is due to higher sales and lower admin expenses. Worth mentioning is that 4Q14
earnings is the 1st earnings growth after 2 consecutive earnings
decline.
Strong net cash of RM22.04m or 22.5 sen per share.
This is an increase of 10% from RM20.0m as of end FY13.
Compared to its share price of 49 sen currently, 46% of the share price is in
cash.
Cash flow control is good.
For FY14: Operating Cash Flow is RM3.5m, Capex RM0.4m, Financing
Cash Flow RM1.2m. Effectively, the Company is doing the right thing by
generating positive cash flow to shareholder.
Looking ahead to better FY15 (Year End May)
Recall that FIBON secured the factoring business in Aug 2013
and I think FY14 is the gestation period to get the business running
efficiently.
FIBON theoretically worth 67.5 sen.
Items
|
Value
(RM m)
|
Current
business valued at 9x
|
44.1
|
Net Cash
|
22.0
|
Total
Value
|
66.2
|
No of
shares
|
98
|
Value
Per Share (sen)
|
67.5
|
WOW, potential return
is 38%.
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