briefly stated: more than 40 minority shareholders attended, twice the no. last yr. atmosphere was more cordial n courteous, no walk-out yesterday. perhaps the sh px having risen by some 33% since last agm helps.
1. low div of 1.25c - Mano fired the 1st shot. mgt said they will consider request for higher div, interim div or special div or bonus issue next round. they did sound more sincere this time but no promise b'cos w/capital needed for steel trading is high, some $40m.
2. business prospect for steel trading in the next few yrs looks very good. bcos of new mrt lines, expressway, underground facilities etc.etc.
3. most of the discrepancies on properties in AR2013 vs last yr were explained. last yr figures showed total units or areas in the whole development not just the balance.
hence sales were not high even though many units disappear from the scene this yr. Also land under development were subdivided then sold off, the balance had to exclude common facilities like road, hence balance area reduced disproportionately.
4. Seven Crescent development - comprising 14 units of cluster bungalow. Marketing has started but no sales registered yet. asking price > $5m each, foreigners not eligible b'cos it is landed. Est. cost is below $60m vs revenue $70m & none of the est. profits has been recognised to-date. (confirmed by Group Accountant).
4. land use / plot ratio at paya lebar site. still status quo - no news from URA on revised Masterplan 2013. Previous version 2008 was made available for public consultation in May 2008 but to-date nothing was announced by URA in 2013 yet.
At recent AGM of 25 Oct 2013,
- management says steel business continues to be strong, capacity may be increased to cope with demand due to new projects in Spore. That sector is subject to the usual industry risk factors.
- continue to sell their Malaysia land which has been doing well, exploring some property projects in China as previous project is sold already. Trying to sell the Seven Crescent project but not easy, selling above breakeven cost, each unit sale price is around SGD5million.
- still awaiting Master Plan 2014, to see if any changes to land use and plot ratios for current Lion Building which is valued at slightly below $400psf. Rental revisions likely upwards.
- investors asked for higher dividend payout ratio, was rejected. After lengthy debate about it, they finally noted the suggestion of interim, final, special dividend concept to give more cash back in good years.
- a shareholder suggested a Bonus issue to reward long-term shareholders since they could not increase dividend for now due to potential capex needs of booming construction sector in Spore. The Board said they will look into that. Shareholders lamented that more should be done to boost the valuation of the stock which languished at PER 3.4x and PBR 0.55x.
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