AUSGROUP ups order book to over A$200 m
John Sheridan, MD, AusGroup. Photo by Leong Chan Teik
AUSGROUP has announced a new major contract in excess of A$21 million. This brings the total order book for the Group to over A$200 million.
The contract is to fabricate a twin cell car dumper and iron ore wagon indexer for unloading of iron ore trains delivering ore to a new iron ore export facility at Port Hedland in the Pilbara region of Western Australia.
This is a repeat order from an existing customer.
AusGroup will commence work immediately and expects delivery by June 2009.
“The growth momentum in Australia’s mining sector continues to be strong. We are experiencing strong demand for our services, particularly in the areas of fabrication for car dumpers where we have established a strong track record for cost-efficient timely delivery,” said Mr John Sheridan, MD of AusGroup.
”Our twin exposures to the minerals and oil and gas development boom in Australasia will continue to propel our growth forward.”
Recent NextInsight story: AUSGROUP wins A$38 m of contracts in less than 2 weeks
CWT to book gains of S$63.2m from recent disposals
Global logistics player CWT recently unlocked cash of S$124.4 million by disposing one of its warehouses as well as stakes in its real estate management units.
Its sale and leaseback of the 524,684-sq-ft “Logistics Hub 2” announced last week prompted Daiwa Securities analyst Chris Sanda to reiterate the broker’s outperform call on the stock.
The Japanese broker’s target price of S$1.58 is based on readjusted net asset value and is 86% higher than CWT’s previous close price of 85 cents.
Chris reckons that CWT is sitting on over S$500 million worth of 11 warehouses, more than double the S$176.4 million on the books as at end 2007.
The S$500 million valuation has yet to account for two warehouses under construction, six more announced for future development and its core logistics businesses.
The latest sale and leaseback deal results in
1) Cash proceeds of S$115.2 million
2) A one time gain of S$55.5 million for FY08 earnings
3) Net asset value increase of S$76 million, raising it to S$231.9 million or 40.4 cents a share
4) A net cash position vis-à-vis net gearing of 0.32X as at end 2007.
In another deal announced yesterday, CWT is also disposing its entire stake in building and estate managers Cambridge Industrial Trust Management Ltd (20%) and Cambridge Industrial Property Management Pte Ltd (50%).
CWT'S stake in Cambridge Industrial Trust Management (manager of SGX-listed REIT Cambridge Industrial Trust) was disposed at S$7.36 million while its stake in Cambridge Industrial Property Management (property, lease and marketing manager for the SGX-listed REIT) was disposed at S$1.84 million.
The share disposal results in
1) Cash proceeds of S$9.2 million
2) A one time gain of S$7.7 million for FY08 earnings
Of a total gain of S$85.7 million from the sale and leaseback, S$30.2 million will be offset against leaseback commitments and the balance S$55.5 million accounted as one-time gains.
The share sale will add another S$7.7 million, amounting to total one-time gains of S$63.2 million arising from these deals.
Net proceeds from the disposals will be used to reduce bank borrowings, fund its expansion and for working capital, the company said in a statement to the Singapore Exchange.
OSK-DMG reiterates buy on Lizhong Wheel on strong industry data
OSK-DMG analyst Lee Shaun Tzen reiterated the broker’s buy recommendation on one of China’s leading aluminum wheel makers, Lizhong Wheel, after the China Association of Automobile Manufacturers reported that passenger car sales rose 17.4% y-o-y during the first 5 months of 2008.
While higher oil prices and costs of raw materials are a cost of concern for many manufacturers in China, Shaun Tzen believes Lizhong Wheel will “ride smoothly” these two risk factors.
Prices of aluminum, a major cost component in Lizhong Wheel’s aluminum alloy wheels, has come off its peak of Rmb 20,200 a ton during 1H07, to less than Rmb 18,500 currently.
The analyst’s target price of 88 cents on Lizhong Wheel, based 8X FY08 price earnings, is 60% above the stock’s last close price of 55 cents.
