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Stocks In Focus (PLife REIT, UE, WBL, Starhub)
2.9% Increase In 1Q13 DPU; PLife REIT
A distribution per unit (DPU) of $0.264 for 1Q13 was posted by Parkway Life REIT (PLife REIT), compared to that of $0.256 seen in 1Q12. Distributable income stood at $16 million for 1Q13, against that of $15.5 million in 1Q12. Stripping off the one-off tax adjustment of about $0.6 million for the previous year would have seen year-on-year distributable income and DPU growth of 7 percent instead. The better results was mainly attributable to full-quarter contributions from the Japan and Malaysia properties acquired in March and August in 2012. PLife REIT has at end-March 2013 maintained 100 percent occupancy rate in its properties, with 90 percent of it total portfolio enjoying downside revenue protection. 68 percent of its total portfolio is also pegged to a CPI-linked rent revision formula. These measures would be a buffer ensuring earnings viability in times of economic uncertainty and more assurances on rental income growth potential.
Significance: As at end March 2013, PLife REIT’s total portfolio size stands at $1.4 billion. It has a portfolio of 37 properties located in the Asia-Pacific region. Factoring in its current DPU of $0.264 would effectively translate to an annualised distribution yield of 4.17 percent, based on its closing price of $2.53 on 28 March, 2013.
Final Offer Made By UE For WBL
In its latest bid of offer made by United Engineers (UE) to WBL Corporation (WBL), UE has done a show hand offer by raising its offer price for WBL to $4.50 a share, an 8.4 percent increase or $0.35 rise compared to its previous offer of $4.15. This will effectively value WBL at $1.25 billion, which is just a tad bit larger than UE’s own market capitalisation of $919 million. UE’s managing director and chief executive officer Jackson Yap expressed that the improved offer sweetens the deal for the shareholders of WBL and demonstrates UE’s seriousness to bring its offer to a successful close. The issue of WBL’s recently announced loss of $11.4 million, mainly due to performance suffered on its US technology subsidiary’s end was also highlighted. The deadline for WBL shareholders and convertible bondholders to accept the offer has been extended to 5.30pm on 29 May. UE expressed that the deadline is final and will not be extended even if the share offer becoming unconditional with UE crossing the 50 percent control threshold.
Significance: UE’s current level of shareholding stake stands at 39.82 percent. Including the acceptances in stock units amounting to another 2.84 percent still puts UE behind WBL’s largest shareholder, Straits Trading Company (STC), which shareholding stake stands at 44.58 percent. It will be interesting to see what STC will do next and it has expressed it is now reviewing this.
Starhub’s 1Q13 Profit Up To $91.2M
Telecommunication firm Starhub posted a profit of $91.2 million for 1Q13 up by 3.2 percent from a year earlier. Operating revenue of the firm meanwhile decreased by 1.8 percent to $580.1 million from $590.9 million which was offset by the lower operating expenses. Despite having a growth of 4.3 percent year-on-year on postpaid subscriptions with 1.113 million in 1Q13 against 1.067 million in 1Q12, Starhub’s revenue from mobile fell by 1.5 percent to $301.9 million due to lower outbound roaming and usage revenue. Subscriptions for pay-TV fell to 532,000 from 544,000 along with lower advertisement revenue, caused the segment to fall by 1.1 percent to $94.7 million. The firm declared an interim dividend of 5 cents per share while it opened lower at $4.71 this morning.
Significance: Starhub revised its outlook FY2013 to low single-digit growth for revenue year-on-year. It intends to maintain their annual cash dividend payout of 20 cents per ordinary share for 2013. Prices may be given downside pressure based on thinning dividend spread (as a result of a non-possibility of upward dividend growth this year), increased competition and revenue slowdown.
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