Thursday, January 10, 2008

CSC better at PR now

Today is the debut of the new STI index by FTSE. Yahoo can't view it, Poems can't see it much for a good start. The new index closed down 33 pts at 3311 pts with a volume of 1.9 billion. Despite the big u-turn by Dow of around 140 points, STI didn't manage to ride on the wave. Again, we are still stuck in the descending triangle. With each successive rally, we're forming a lower high. Bad signs?

A few information to share:

1. Lianbeng announced its half year statements today. I think it did pretty well, with revenue increasing by 23%, gross profit by 206.8%, profit after tax by 285.5%. I did a pretty fast calculation of the gross profit margin (gross profit/revenue) and net margin (gross profit - operating costs / revenue):

1st half FY07 - gross margin 15.62% - net margin - 7.65%
1st half FY06 - gross margin 6.27% - net margin - 2.44%

Funny. Never expected construction to have a margin of 7.7%. There's a huge difference in gross margin, enough that a serious investor in Lianbeng ought to find out. Is it possible that the growth in revenue outpaced the increase in costs of goods sold? I do not have the answers.

Compare the figures with the few that I know: Popular net margins 4.2%, FJ ben around 5%.

2. CSC is gettin better at investor relations. They announced that they had, in the past 2 months, awarded approx. S$120 million worth of foundation and geotechnical engineering contracts from both public and private sector. These include:

Public sector -
1. Tree lodge for HDB at punggol west
2. City view at boon keng
3. Bukit merah
4. Fusionpolis
5. Sections of MRT downtown line extension

Private sector -
1. Reflections at Keppel Bay, waterfront residential condo
2. Hotel and commercial development at Collyer quay
3. Mont Kiara @ Eleven, condo in KL, M'sia

These bring CSC's order book to 330 million. Projects are expected to be completed within 12 months.

China milk hit my target at 1.25, exceeded at little at 1.26 before retracing all the way back to close at 1.15. Retracement to touch upper channel trendline at 1.11/1.12? Low volume too.

Dow futures down 18 pts. Ben is speaking today, if I'm not wrong.