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homerun
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Posting #31: Thu Mar 29th, 2007 04:43 |
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Hi Moola,
Totally agree with you that extra money of a company shud be returned to shareholders and not invested in stk mkt.
Hopefully, we will see Hexza paying higher dividend this year.
Rgds.
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Moolah
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Posting #32: Thu Mar 29th, 2007 05:21 |
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Homerun,
See hor.. a couple of issues concern me.
As it is, if we do not know how big a contribution this disposal of share thingee is, then we cannot ascertain the strength of hexza growth or even if the growth for Hexza is for real.
And if you look at the earnings notes, the company said the following:
Revenue for the quarter at RM41.94 million was slightly lower by 0.5% as compared to RM42.15 million in the immediate preceding quarter. The corresponding profit before tax at RM4.70 million is slightly lower as compared to RM4.76 million previously. The rising cost on major raw materials continue to pose challenges to the Group’s operations. However, steps are being taken to improve operating efficiency.
Remember this issue we talked about? And we have to take into consideration that the net profit margins is rather on the low side.
And last but not least... the size of the profit... as it is, it's 14 mil (how much is the gain from disposal of shares?).. and 14 mil for a main board company, isn't really too attractive, is it?
These are my concerns...
And for your information.. there is something i do like about Hexza. It does have a wonderful looking set of cash flows...
rgds
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homerun
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Posting #33: Thu Mar 29th, 2007 05:49 |
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Hi moola,
Hexza has been facing the challenges of the rising cost of raw materials for quite some time. As mentioned in earlier discussions, the cost of their raw materials has a lot to do with crude oil price. With crude oil px going down quite a bit for quite some time now, Hexza shud have been in a better position to tackle this problem. But I dont know why Hexza still mentioned the rising cost on raw materials continue to post challenges to the company.
If we take out the 4.95 mil gains from disposal of quoted shares, the total annual net profit wud roughtly be 14.793 - 4.95 = 9.843 mil. Total shares : 128.49 mil. Then Eps shud be = 7.66 sen from Hexza core businesses. Then PER = 65/7.66 = 8.49 x Fy07. Not so attractive anymore.
So, being cash-rich seems to be the only big plus for Hexza. Haha...
Rgds.
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Moolah
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Posting #34: Thu Mar 29th, 2007 05:54 |
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Homerun,
I do hope I am not being too critical and actually i do hope that my comments acts as a good second opinion. IMO all shares will have some sort of good/bad issues in them. So for us, the minority investor, it is up to us to decide what it's acceptable or not acceptable.
cheers
(any other stocks u wanna chat? got ah? )
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homerun
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Posting #35: Thu Mar 29th, 2007 11:41 |
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Hi Moola,
You are far from being too critical. All the points you kindly brought forward here are indeed valid and solid and I always value your 2nd opinion.
Ya, all counters certainly have some sort of good/bad issues in them, just like human beings who surely have some strengths as well as some weaknesses. By understanding the good/bad issues of companies and their strengths as well as weaknesses, we will be able to make better judgements on them and stay on top of the games.
I have many other stocks to discuss and will discuss with you some other time. haha...
Thank you very much again for your kind help.
Cheers.
Last edited on Thu Mar 29th, 2007 11:50 by homerun
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homerun
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Posting #36: Fri Mar 30th, 2007 04:52 |
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Hi Moola,
FYI, I came across an article on Hexza this morning on this blog : http://fusioninvestor.blogspot.com/
Rgds.
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Moolah
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Posting #37: Fri Mar 30th, 2007 07:29 |
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homerun wrote: Hi Moola,
FYI, I came across an article on Hexza this morning on this blog : http://fusioninvestor.blogspot.com/
Rgds.
homerun,
thanks for the heads up.
cheers!
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Moolah
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Posting #38: Sat May 5th, 2007 02:34 |
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Homerun,
Hexza mada an earnings announcements.. earnings distorted due to change in fiscal calender.
Any comments from you?
cheers!
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homerun
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Posting #39: Sun May 6th, 2007 05:50 |
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Hi Moola,
This is my homework on Hexza.
The table below shows Hexza's quarter-to-quarter performance. Please note that 2m07 is for the 2-mth financial period from Feb01,2007 to Mar31,2007. 2mq07 means quarterise(got this word or not?) the 2m07 numbers (figures in 2m07 x1.5).
Total number of shares : 129.115 mln
current price = Rm0.69
[/code][code] 1Q07 2Q07 3Q07 4Q07 2m07 2mq07
Revenue (mln) 33.724 41.784 42.152 41.935 26.697 40.046
PBT (mln) 3.902 5.367 4.762 4.696 1.837 2.756
Net profit (mln) 2.938 4.832 3.524 3.499 1.238 1.857
EPS (sen) 2.28 3.74 2.73 2.71 0.96 1.44
NTA (Rm) 1.12 1.15 1.18 1.20 1.21
cash at banks (mln) 27.596 28.686 34.060 36.431 36.672
long-term borrowings 1.088 1.088 1.088 1.688 1.488
shart-term borrowings 4.241 3.142 4.241 0.222 0.300
net cash (mln) 22.267 24.456 28.731 34.521 34.884
net cash per share (sen)17.25 18.94 22.25 26.74 27.02
TIQS mkt value (mln) 13.141 12.859 13.753 16.274 18.462 |
TIQS : total investment in quoted securities
As can be seen, revenue in 2mq07 was still ok, still above the 40 mil level, but net profit declined sharply in 2m07 due to higher raw material costs. Net cash per share has constantly been on the rise. As at Mar31,2007, net cash per share was 27.02 sen, which is about 39.2% of the current mkt px. Total investment in quoted securities at mkt value also increased to Rm18.462 mil, in tandem with the strong KLSE performance, which translates into 14.30 sen per share. 27.02 + 14.30 = 41.32 sen, which is about 59.9% of the current mkt px.
Pls also note that as KLCI increased by 9.3% from Mar30,07 to May04,07, it is reasonable to assume that Hexza's total investment in quoted securities has also increased by a certain percent.
I think one of the plus points in Hexza is that it is a cash-rich company trading at a resonably low PER. Stripping off the cash, Hexza is trading at a even low PER.
As the latest quarterly results show some signs of weakness in earnings, I think consevative investors might want to wait for the next-quarter results to come out 1st.
Rgds.
Last edited on Sun May 6th, 2007 08:57 by homerun
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homerun
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Posting #40: Sun May 6th, 2007 05:53 |
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| Sorry for the mess up of the table which is in excel format. I dont know how to properly paste a excel table here.
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