Stocks In Focus SG (Blumont, Ezra Hldgs, Suntec REIT) – 24/01/14

Blumont To Acquire Australian-Listed Resource Company

• Blumont proposed to acquire all ordinary shares of Genesis Resources, a mineral exploration and development company listed on the Australian Securities Exchange, through an off-market takeover bid of A$0.169 per share.

• Genesis’s core asset is the right to a majority stake in the gold-silver-copper project, located in Plavica, Macedonia. Plavica is situated within the Carpathian Volcanic Arc, a province running through Eastern Europe, which is highly prospective for gold, copper and silver mineralisation.

• The proposed bid price represents a premium of approximately 87.8 percent above the closing share price of Genesis’ on 23 January 2014. Blumont will finance the acquisition by issuing 509.5 million new shares in exchange for two Genesis shares for every 5.3 Blumont shares. When completed, the new shares issuance will represent 19.7 percent of the existing share capital.

Significance: In addition to Plavica, Genesis has a portfolio of gold, iron, manganese, uranium and base metal exploration licences covering more than 1,136 square kilometres in the prospective Proterozoic and Phanerozoic metallogenic provinces of northern and central Australia.

Ezra Hldgs Secures US$80m Worth Of Subsea Projects

• Ezra Holdings has been awarded US$80 million worth of subsea projects including options.

• Expected to commence by 1H14, the scope of these projects cover a spectrum of subsea work, including the decommissioning and towage of an floating production, storage and offloading unit in Asia and the deployment of an inspection, maintenance and repair vessel in the USA.

• The company’s subsea orderbook stands at more than US$1.4 billion, and is still tendering for approximately US$9 billion worth in projects worldwide.

Significance: The Group began the year with strong top-line growth and operational profitability, registering a 22 percent increase to US$339.8 million in revenue compared to the corresponding period in FY13.

Suntec REIT’s FY13 Distribution Per Unit Falls 1.7%

• For the year ended 31 December 2013, Suntec Real Estate Investment Trust (Suntec REIT) saw a 9 percent decline in net property income to $148.7 million from $163.4 million, on the back of lower revenue contribution due to partial closure of Suntec City mall for asset enhancement works.

• The company incurred $85.4 million of property expenses in FY13, a 13.2 percent decrease compared to $98.5 million last FY, mainly attributed to the partial closure of Suntec City mall.

• In light of $16.4 million lesser other income recognised as a result of income cessation from One Raffles Quay, distributable amount to unitholders inched down less than 1 percent to $211.2 million.

Significance: Total amount distributable to unitholders translates into a distribution per unit of $0.09328, 1.7 percent lower than FY12. Suntec REIT’s overall high office portfolio committed occupancy of 99.6%, coupled with a balance of only 12.5% of its office leases due to expire in 2014, performance of the office portfolio is expected to remain positive.

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