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u think leh? borrow of course lah.
they taking a big risk here, since rubber price so low now.
i am not worry rubber price but the interest rates of the borrowing. hope by then price overshot the rise in interest rates.
bllue911 ( Date: 14-Aug-2014 11:10) Posted:
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How they finance all these purchases?
Halcyon announced the acquisition of New Continent Enterprises this morning. New Continent is a long established and renowned rubber distributer and dealer. With this, Halcyon has transformed into a fully integrated natural rubber grower, processor, dealer and distributor. At this stage, its plantation estate is still at the very early stage. Its mid stream processing capacity is among the world top 3. Now it has New Continent, the downstream dealer and distributor of natural rubber with offices in Germany, Netherlands, USA, China and Vietnam.
Halcyon now captures the entire margin along the natural rubber chain of business. The size and scale of its operation, the profit potential when rubber price recovers are substantial. Monitor the fundamentals.
Rubber price is depressed due to finished inventory overhand. This has also caused latex price to come down and it reaches a point which the rubber tappers feel that there is no point tapping the trees since it does not make economical sense for them and they prefer to look for works in other plantation related businesses. So hopefully it won' t take long for the market mechanism itself to correct this overhand of finished inventory and reduced supply in raw material, resulting in squeeze in margins for rubber processors. Share price reflects expectations of its future. From investment point of view, a lull cycle of an industry always create good investment opportunity.
With rubber prices so down, wld the share price of the co be so bullish?
Last announcement it gap up till 97c than come down...have not smell the $1 mark yet...will this time try again ...
HVRRVH ( Date: 13-Jul-2014 18:47) Posted:
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It should be positive. I have a price in mind and if it matches during openning I will look to contra it. Bo bian, no more bullets liao after loading up 2 other counters. If gap up too much I wll have to let it pass.
ysh2006 ( Date: 13-Jul-2014 18:36) Posted:
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Yesterday announced something and will be lifting halt on Monday...See share price react to this news +ve or -ve ?...on Monday...
cleverboy ( Date: 12-Jul-2014 02:05) Posted:
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Watch this company. Future potential is huge. One key determining factor - RUBBER PRICE.
If rubber price recovers, this company will make tonnes of money. Not that it does not make money now, the low price of natural price is depressing its margin. When natural rubber price recovers to around US$2000-US$2100 per ton, this company should make about S$100 mil EBITDA. At 8x PER, the market cap can be S$800 mil. With the current share base or even with dilution from the conversion of preference shares as announced by the company on 11 Jul 2014, the share price might be S$1.80.
just need to make some simple research work and you will rrive at the same conclusion.
Bought this on last friday to contral. Sold too early this morning before the volume surged, if only hold on for another 8 minutes! Never mind, profit better than lost, I very weak in contral anyway.
looks like more likely to head lower.
sporeshare.blog spot.sg/2014/06/halcyon-agri.html
Based on information pulled from Acra, Anson had the following results.
2012 2011
Sales S$1.2 bil S$1.9 bil
Profit before tax S$38.3 mil S$97 mil
Profit after tax S$29.8 mil S$74 mil
Current Asset S$268.3 mil S$286 mil
NonCurr Asset S$30.2 mil S$31.2 mil
Currnet Liab S$88.9 mil S$113.9 mil
NonCurr Liab S$5.8 ml S$6.4 mil
Equity S$203.7 mil S$197.8 mil
Just to add on, no share dilution resulting from the purchase! Monday will be interesting, to see how the market react.
cleverboy ( Date: 19-Jun-2014 22:22) Posted:
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Chip Lam Seng was under judicial management before Halcyon bought it. There is basically only the land which the factories were located, some inventories and raw materials and the machines. No cash, no customer and time is needed to rekindle the production and the business. Thus, one can get it cheaper, S$25.6mil for 180k ton capacity, about S$142.2/ton. When Halcyon first acquired its 2 factories in Palembang, it paid US$20mil in 2010 with installed capacity of about 90k ton, ie S$277 per ton.
The current acquisition of Anson Company (Private) Limited, apparently was owned by the Lee Rubber. The 9 factories are currently in production. Based on information from rubber factories owners in Palembang, there would be raw material and finished good inventories, machines, land, cash, debtors and creditors in this group of companies. So from the price paid S$450 mil, it would not be possible to tell how much per ton of capacity is Halcyon paying. What need to be taken into consideration is the profitability of the business, the net book value of the business and the premium for acquiring such sizable processing capacity overnight. Pending more information being available, or unless some kind soul willing to buy the information from ACRA, one can' t really tell how much is being paid per ton of processing capacity. One more point to note is how Halcyon will be financing the acquisiton. Pending further details, it is difficult to guess the financial impact. So let' s wait a couple of weeks more.
But one likely outcome with the lastest acquisition is that Halcyon' s rubber processing capacity would be the among the top 5 processors in the South East Asia region. Before acquisiton of Anson, Halcyon has a total capacity of 383k ton. With Anson acquision, total capacity would be 791,000 tons. Since Chip Lam Seng is rekindled from idleness, let' s just assume that capacity utilistation is 50,000 tons by end of this year. So, Halcyon would have 153k ton (Palembang) plus 50k ton (Jambi) plus 50k ton (Chip Lam Seng) plus 408k (Anson), ie a total of 661k ton of processing capacity. If the company can maintain is EBITDA of US$180 per ton (as per co' s presentation in Mar 2014), or for conservative sake, let' s just assume that it can generate US$120 per ton of capacity, its EBITDA would be US$79.32 mil or about S$99 mil. This is a astonishing. How many company listed on SGX has an EBITDA of near S$100 mil? If the market is willing to pay 10x EBITDA, wah lao, the market cap of this company would be S$1 billion. Is this another Wilmar?
Any way, rubber prices are low now due to excess inventories of processed rubber. There is also undersupply of raw materials due to the low rubber prices. This has resulted in a squeeze in the margins for processors. Give the market a bit of time, the inequilibrium should adjust itself back to normalized situation. So I think Halcyon is taking the opportunity of the current situation to build up its capacity and when situation improves, it shall likely reap the bountiful rewards. A clever move by the management.
AddLuck ( Date: 19-Jun-2014 17:49) Posted:
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$450 000 000 for 400 000 ton output per annum doesn' t seem right to me. (a total of 9 factories). Chip LAm Seng state of the Art factories in Malaysia seemed very cheap in comparision plus another 3 also in Riau....also at very cheap price. WHat is the motive for this one???.......want to be top producer???.....a bit overstreching, i think.
AddLuck ( Date: 12-Jun-2014 17:08) Posted:
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Flying high
spore1 ( Date: 15-Jun-2014 11:56) Posted:
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this babe is all set to test new high.
sporeshare.blog spot.sg/2014/06/halcyon-agri.html
Yes, with rubber price at all time low....think they are taking advantage to acquire more assets at dirt cheap prices ( processing plant and even plantations)......what more, they are coming up with some MTNs.....$ 300 mil????...forgot the figure.
ozone2002 ( Date: 12-Jun-2014 16:50) Posted:
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Last:0.885 Vol:12090k
+0.055
there' s a couple of high profile investors in this..
ozone2002 ( Date: 15-Apr-2014 13:13) Posted:
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Now .89. Wow.. all M& A news is driving our market here.
Don' t know how much is true or will it be......
Cheers.