Singapore | Consumer Staples
Asia Pacific Equity Research
QAF LIMITED | BUY
MARKET CAP: USD 397.4M
18 Sep 2015
Company Report
AVG DAILY TURNOVER: USD 0.1M
INEXPENSIVE STOCK OFFERS 5%
DIVIDEND YIELD
BUY (initiate)


add: 12m dividend forecast
S$0.050
versus: Current price
S$0.990
Fair value
Dominant position in core markets
Positive outlook for bakery and pork
production industry
Trading below peers’ averages

S$1.27
12m total return forecast
33%
Analysts
Established market leader in baked goods and pork production
QAF Limited (QAF) is primarily engaged in bakery manufacturing and
distribution with leading brands Gardenia and Bonjour, while it also
owns the largest fully integrated pork production business in Australia
under Rivalea. The group’s bakery brands command 60% of market
share under the packaged loaf bread segment in Singapore. Within a
broader baked goods segment (i.e. bread, cakes, pastries), they are
leaders in their core markets with market share of 26%, 18%, and
11% in Singapore, Malaysia and Philippines respectively.
Profitability expected to continue improving
We note that both of the group’s core businesses hold competitive
strengths such as branding power, value-added product portfolio, as
well as extensive distribution networks in its core markets. The group
leverages on its knowledge and research capabilities to launch new
products as well as productivity initiatives to garner better margins.
We estimate that core PATMI on a group level has been relatively
steadier since FY11, vs. a seemingly bumpy net profit performance.
Both core business segments are recording gradual signs of recovery
in terms of EBIT and they continue to improve as of 1H15. Expansion
of facilities coupled with extension of its distribution reach in other
markets would help to drive growth ahead. Favourable industry trends
for both operations coupled with expectations for lower global wheat
prices this year bode well for the group.
Jodie Foo (Lead) ● +65 6531 9809
jodiefoo@ocbc-research.com
Eugene Chua ● +65 6531 9678
eugene.chua@ocbc-research.com
Key information
Market cap. (m)
S$555.7 /
USD397.4
Avg daily turnover (m)
S$0.2 /
USD0.1
Avg daily vol. (m)
0.2
52-wk range (S$)
0.915 - 1.23
Free float (%)
29.6
Shares o/s. (m)
561.3
Exchange
SGX
BBRG ticker
QAF SP
Reuters ticker
QAFS.SI
ISIN code
GICS Sector
GICS Industry
Top shareholder
Relative total return
Q01
Consumer Staples
Food Products
Tian Wan
Enterprises- 22.4%
1m
3m
Company (%)
-4
-10
12m
6
STI-adjusted (%)
2
3
16
Price performance chart
Initiate with BUY; S$1.27 TP
QAF is currently trading at 10.6x FY15/16F, below its peers’ averages
for both consumer goods (22x-26x) as well as integrated food
producers (12x-18x). In addition to the above, the stock has been
offering a stable dividend payout of S$0.05/share since FY11, which
gives a dividend yield of ~5%. We think this inexpensive stock
deserves more attention. Using sum-of-the-parts methodology, we
have derived a TP of S$1.27, implying a total return potential of 33%.
Initiate coverage with BUY.
Sources: Bloomberg, OIR estimates
Key financial highlights
Year Ended Dec 31 (S$ m)
Revenue
Cost of sales
Amortization and Depreciation
Core PATMI
EPS (S-cents)
Cons. EPS (S-cent)
P/NAV (x)
Gross profit margin (%)
Industry-relative metrics
FY13
FY14
FY15F
FY16F
1,024.2
1,023.1
1,035.4
1,060.3
-558.5
-546.5
-546.7
-558.8
-38.3
-36.9
-37.7
-38.5
29.6
39.1
50.4
52.8
5.6
8.2
9.1
9.5
na
na
na
na
1.3
1.3
1.3
1.2
47.3
45.5
46.6
47.2
ROE (%)
7.6
11.1
11.9
11.7
Net gearing (%)
3.0
-3.4
-7.7
-11.7
Note: Industry universe defined as companies under identical GICS classification
listed on the same exchange.
Sources: Bloomberg, OIR estimates
Please refer to important disclosures at the back of this document.
MCI (P) 006/06/2015
OCBC Investment Research
Singapore Equities
Table of Contents
A. Investment Thesis
3
A.i
Market leader in its core businesses
A.ii
Bakery business adds some resilience
A.iii
Scope for earnings growth from Primary Production business
A.iv
Continued improvement in profitability
A.v
Inexpensive stock offers 5% dividend yield
B. Company Background
4
B.i
Business overview
4
B.ii
Bakery – Market leader
5
B.iii
Primary Production – Room for growth
8
B.iv
Trading & Logistics – A distribution business with proprietary
brands
C. Industry Overview
11
13
C.i
Baked goods in QAF’s core markets
13
C.ii
Pork industry in Australia
16
D. Key Risks
18
E. Financial Highlights and Forecasts
19
F. Valuation and Recommendations
22
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OCBC Investment Research
Singapore Equities
Section A: Investment Summary
Market leader in its core businesses
QAF has established its dominant position in the packaged loaf bread sector
with leading brands, Gardenia and Bonjour commanding 60% of market
share in Singapore as of 2014. In the broader baked goods segment (i.e.
bread, cakes, pastries), they are leaders in their core markets with market
share of 26%, 18%, and 11% in Singapore, Malaysia and Philippines
respectively. In addition, Rivalea is the largest fully integrated producer of
pork meat in Australia, making up an estimated 17%-20% of the country’s
total pork production.
Bakery business adds some resilience
The Bakery business contributed 48.7% to overall sales and 77.5% to total
EBIT in FY14. The segment achieved a 7.4% CAGR in sales over the past 10
years on the back of strong branding, new value-added products and an
extensive distribution network in its core markets. The group’s factories are
usually running at near full capacity, and there are plans to expand their
facilities to meet rising demand, as well as strengthen their presence in
Philippines, Australia and China.
Scope for earnings growth from Primary Production business
After facing tough conditions over the years, operating profit for Primary
Production tripled in FY14 and continued to improve as of 1H15. We believe
there is scope for earnings upside here, driven by continued focus on sale of
fresh meat cuts, coupled with positive industry trends for pork demand and
pork prices. As feed costs constitute about 60% of revenue, lower feed grain
prices would be a major driver for profitability as well. In the latest Sep
report by the Australian Bureau of Agricultural and Resources Economics
(ABARES), world wheat prices are expected to average lower due to ample
global supplies.
Continued improvement in profitability
On a group level, net profit has been bumpy over the years due to several
one-off charges mostly relating to disposed subsidiaries. Stripping these
items out, we estimate core PATMI to have been relatively steadier since
FY11. We note the gradual signs of recovery for both core business
segments in terms of EBIT, and continued improvement in profitability for
the group’s latest 1H15 results adds to our confidence.
Inexpensive stock offers 5% dividend yield
QAF is currently trading at 10.6x FY15/16F, below its peers’ averages for
both consumer goods (21.9x-25.9x) as well as integrated food producers
(12.4x-18.1x). In addition to the above, the stock has been offering a stable
dividend payout of S$0.05/share since FY11, which gives a dividend yield of
~5%. We think the stock deserves more attention. Using sum-of-the-parts
methodology, we have derived a TP of S$1.27, implying a total return
potential of 33%. Initiate coverage with BUY.
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OCBC Investment Research
Singapore Equities
Section B: Company Background
i. Overview
About QAF Ltd
QAF is an investment holding company majority owned by the Salim family.
The group primarily engages in bakery manufacturing and distribution, as
well as pork production in Australia. Their bakery brand Gardenia has
become a household name in Singapore, and it is the market leader in its
core markets Singapore, Malaysia and Philippines. QAF also owns Rivalea
(Australia) Pty Ltd (“Rivalea”), the largest fully integrated meat production
business in Australia. Another business segment is Trading and Logistics,
whereby it trades and distributes food, beverages, and food related
ingredients including proprietary brand products, Cowhead milk and dairy,
as well as Farmland frozen products.
Earnings profile
About 48.7% of revenue is derived from Bakery, while 38.3% comes from
the Primary Production business. The group’s Bakery business contributes
the bulk of operating profit at 77.5% of total EBIT as of FY14.
Exhibit 1: Revenue mix (FY14)
Trading and
Logistics,
9.7%
Exhibit 2: Operating Profit mix (FY14)
Investments
and others,
3.3%
Trading and
Logistics,
4.2%
Investments
and others,
3.6%
Primary
production,
14.7%
Primary
production,
38.3%
Bakery,
77.5%
Bakery,
48.7%
Sources: Company, OIR
Sources: Company, OIR
Some businesses have been disposed
The group had previously made several acquisitions that have since been
disposed of, mainly due to losses incurred. This included acquiring 1) a 51%
stake in an Australian dairy manufacturer, Challenge Australian Dairy Pty Ltd
(“Challenge”) in 2004, 2) Shaanxi Hengxing Fruit Juice Co, a producer of
apple juice concentrates, also in 2004 as well as 3) a 55% interest in pork
specialist China Food Industries Limited (CFI) (renamed Iconic Global in
2008) in 2005. Operations were ceased for Challenge in 2010, while financial
results from Shaanxi Hengxing were deconsolidated in FY08 and the group’s
entire interests were sold in FY11. CFI’s results were deconsolidated in 2007.
With the disposal of its dairy farm operations completed in 2014, the group
owns three investment properties in Australia, which are leased out for
rental income.
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Singapore Equities
ii. Bakery – Market leader
QAF established its dominant position in the packaged loaf bread market in
Singapore with its acquisition of the Bonjour brand in 2001, which was the
second largest brand after Gardenia. In 2004, the group entered into
Australia’s bakery market by acquiring Bakers Maison, a manufacturer and
supplier of French-style bread and pastry products.
Exhibit 3: QAF’s leading bakery brands
Source: Company
Dominant position in key markets
Gardenia and Bonjour are leading brands in the packaged/industrial bread
market in Singapore, capturing 60% of market share in 2014 according to
Euromonitor International, while we understand that Gardenia has a 60%
market share in Philippines’ Metro Manila branded loaf bread market.
Euromonitor International data also reveals that in terms of a broader baked
goods segment (i.e. bread, cakes, pastries), the group holds the dominant
position in Singapore, Malaysia and Philippines with value share of 26%, 18%
and 11% respectively. We note that the group’s market share is gradually
recovering in Malaysia amid keen competition following the entrance of
Massimo into the same market in 2011.
In terms of revenue by geography, we estimate Malaysia to lead with 59%,
followed by Philippines (24%), Singapore (13%) and other countries (4%).
Exhibit 4: Bakery sales (FY05-14)
Exhibit 5: Bakery sales by geography (FY14)
Other
countries,
4%
600
($m)
500
473.1 477.0
400
497.9 510.7
Philippines
, 24%
431.1
359.1
300
Singapore,
13%
389.2
302.2
200
249.1 258.2
100
Malaysia ,
59%
0
FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14
Sources: Company, OIR
Sources: Company, OIR
Resilient sales performance
Bakery sales have grown at a CAGR of 7.4% over the past 10 years. Given
the nature of strong competition and maturity of the packaged bread sector
(see Section C), the average selling prices (ASP) of its products are kept
rather stable. The consistent growth in sales every year has been typically
driven by new product launches to adapt to changing consumer preferences
as well as their extensive distribution network in the main markets. In the
last few years, Australia continued to see double-digit sales growth albeit
from a low base, supported by securing new manufacturing contracts and
working with more national distributors.
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Singapore Equities
Exhibit 6: Bakery EBIT (FY05-FY14)
80
70
73.1
66.8
60
60.0
($m)
50
40
52.1
54.0
FY12
FY13
FY14
42.2
30
20
51.0
35.6
29.8
29.7
FY05
FY06
10
0
FY07
FY08
FY09
FY10
FY11
Source: Company
EBIT grew despite economic downturns (FY07-FY09)
The segment managed to continue improving its operating profit during
FY07-FY09 amid challenging economic times. This result was underpinned by
better sales, new product launches, and improved efficiencies.
Tight control over wastages a key aspect of efficiency
In Singapore for instance, we understand that the group has its own system
to access bread returns across its distribution routes. Given their threshold
of ~20% for returns, this system allows them to optimize their distribution
reach. During FY09, tighter control over wastages for its Malaysia
operations had contributed to the improved profitability as well.
FY10-FY12 dragged by expansion costs, higher raw material costs
and competition
FY10-FY12 served as a reminder that the industry is still susceptible to rising
raw material prices and other operating costs such as fuel costs. On this
note, we also understand that margins were relatively lower in Philippines
due to high flour costs, because the Philippine Association of Flour Millers
controls flour prices. In addition, the segment was increasing its production
capacities during this period and incurred higher expenses as a result.
Stronger competition also played a role here, whereby the entrance of
Massimo in Malaysia since 2011 was one factor as they had sought to
undercut Gardenia’s prices. Supermarket house brands and artisanal bread
shops added to the competitive landscape as well. (See Section C)
Gradual recovery in the last two years
The Bakery segment showed signs of recovery in the last two years, with
gradual improvement in EBIT from S$51.0m in FY12 to S$54.0m in FY14.
This is attributable to certain factors, including good take-up of new product
launches, such as the wholegrain product range for Singapore; continued
expansion of its distribution reach in Philippines; increased efficiencies from
achieving economies of scale with new lines; and Australia implemented a
better inventory management system in FY13 to control its ingredients and
wastage so as to reduce production costs.
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Singapore Equities
Growth areas
New lines for growth as factories are running near full capacity
We understand that the factories in Malaysia and Philippines are usually
running near full capacity. To meet the market demand in the
Philippines, the construction of the new plant has commenced and is
expected to be operational by Dec-2015. The payback period for a new line
is typically less than two years, while the obstacle lies in getting enough
space for further expansion of production lines to capture the rising demand.
New value-added products to capture larger pool of consumers
The Bakery division constantly comes up with new products to adapt to
ever-changing consumers preferences. To align to the health and wellness
trend among consumers, some of the latest products include the Gardenia
Oats & Honey loaf containing nutritional chia seeds launched in Singapore.
For the Philippines, the pandesal is a bread staple there, and Gardenia
reinvented it with a hotdog-flavored pandesal. With the proliferation of
artisanal bread demand, the group also has plans to implement a franchise
system for the high-end artisan bread stores this year.
Riding on growing modern trade in Philippines
Distribution is often a challenge in developing markets like the Philippines.
The group continues to expand its distribution network in the Philippines,
and will also be able to ride on the growing expansion of modern grocery
retail channels to increase sales.
Positioned to capture opportunities in fast-growing Artisanal market
(Australia)
As a manufacturer and supplier of frozen and par-baked French-style bread
and pastry products, Bakers Maison offers its products to a range of
foodservice customers across Australia such as airlines, hotels, restaurants,
cafes, bakery shops, convenience stores and petrol stations. Bakers Maison
provides contract-manufacturing services as well. Given the growing café
culture in Australia, consumers are turning to more gourmet premium food
options and Bakers Maison is positioned to ride on this trend.
Unpackaged/artisanal bread market grew by 6% in foodservice volume
terms in 2014, and is expected to see a value CAGR of 4.4% over 20142019 (Euromonitor International).
Expanding in Fujian province, China
Gardenia Food (Fujian) Co Ltd is a 55%-owned subsidiary and started
factory operations in Fuqing, Fujian Province, China in Oct-14. In Dec-14,
the company set up its first Gardenia Exclusive Store inside the YH
Hypermarket in Fuqing to sell and promote Gardenia products. The
Packaged/Industrial Bread market could record a value CAGR of 6.8% over
2014-2019 in China (Euromonitor International). Amid this favourable
outlook, there are plans to extend its reach into other cities in Fujian
province with more marketing efforts.
Exhibit 7: Gardenia Exclusive Store in China
Source: Company
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Singapore Equities
iii. Primary Production – Room for growth
The group’s Australian Primary Production business was established
following the acquisition of operations from Bunge in 2001. In 2009, it was
renamed Rivalea (Australia) Pty Ltd and separately, the group had increased
its shareholding interest from 51% to 80% in Diamond Valley Pork Pty Ltd.
Rivalea – largest pork producer in Australia
Its wholly-owned subsidiary, Rivalea is the largest fully integrated producer
of pork meat in Australia, making up an estimated 20% of the country’s
total pork production. This is verified as Rivalea produced and sold ~750k
heads or about 60kMT of meat in 2014. According to the Australian Bureau
of Statistics (ABS), total Australian pig meat produced for 2014 was 362k MT,
giving Rivalea a market share of about 17%.
Fully integrated producer
Being a fully integrated producer of meat, the group engages in stockfeed
milling, livestock farming and production, abattoir (slaughterhouse)
operations, meat cutting and deboning as well as packaging and distribution.
Exhibit 8: Simplified pork production supply chain
Fresh Meat
Feedmill
Breeding
Primary processing
- Abattoirs/
Slaughterhouse/
boning rooms
Secondary
processing
(ham, bacon,
smallgoods)
Supermarkets,
Wholesalers,
Butcheries,
Restaurants,
Hotels
Exports
Source: OIR
In-house feed production
Rivalea has its own stockfeed mills to produce all the company’s stockfeed
requirements. The main raw materials used in stockfeed, such as wheat
grain, barley, triticale, canola, are purchased directly from growers.
Breeding and farm operations
It operates six company-owned farms and 19 contract grower sites located
across the states of Victoria and New South Wales, while third-party contract
growers are hired to grow the livestock till marketable age. Rivalea has
about 46k breeder pigs and a total population of ~409k pigs.
Largest abattoir in Australia (on a single site)
Rivalea’s abattoirs supply all the meat used in production of the group’s
meat products. The abattoir and deboning facility at Corowa, Australia has
the capacity to slaughter 1m heads per year.
Major supplier to Woolworths
Rivalea is the largest producer of vacuum-packed meat cuts and tray-packed
products for a major national supermarket chain (Woolworths) and we
understand from management that this relationship enables a decent
amount of margins to be locked in. Woolworths has the largest value share
of 40% among supermarkets in Australia as of 2014 (Euromonitor
International).
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OCBC Investment Research
Singapore Equities
Proprietary brand meat products distributed via various channels
The group also supplies carcasses and meat products to wholesalers. But as
the sale of whole carcasses competes directly with cheaper frozen pork
imports, it has introduced its own fresh moisture-infused meat cuts, which
are marketed under proprietary brand names and garners better margins.
The brands include: Murray Valley (for butcheries, meat retail outlets), High
Country (food service customers), Family Chef (independent supermarkets),
and Riverview Farms (for free range meat products).
Exhibit 9: QAF’s proprietary brand meat products
Source: Company
Exports
Rivalea exports fresh Rivalea pork to Singapore and other pork products to
major markets like Japan, New Zealand and other Asian countries including
China. Sales from exports contribute about 10% to overall sales.
Financial Performance
Exhibit 10: Primary Production sales (FY05-FY14)
450
400
($m)
350
300
315.8
250
303.6
405.6
406.8
FY11
FY12
423.7
401.7
336.7
327.0
287.5
290.0
FY08
FY09
200
150
100
50
0
FY05
FY06
FY07
FY10
FY13
FY14
Source: Company
Revenue has grown for past six years in AUD terms
Sales growth for the Primary Production business has been generally positive
from FY09 onwards, given that FY14 actually had higher sales in AUD terms.
The depreciation of AUDSGD resulted in the translation loss. The flatter
topline in FY12 was due to a shift in concentration to sell higher-margin
meat cuts while sale of low-margin meat was reduced.
The above has been achieved, despite facing depressed average selling
prices for pork products as a result of increased cheap imports in Australia.
Initiatives to support this include selling its proprietary brands of fresh meat
cuts, introduction of new products, and increased marketing efforts.
Profitability dependent on feed grain prices
According to various reports such as the New South Wales Department of
Primary Industries’ April 2006 report, animal feed costs constitute about 55%
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OCBC Investment Research
Singapore Equities
to 60% of total production costs. As grain prices are subject to weather,
quality and yield of crop, global market prices, this can go up to 70% during
extended droughts. Thus, the volatility in feed grain prices as seen in Exhibit
12, coupled with high labour costs, will erode margins.
The extent of impact from the cheaper imports is also clearly seen from the
dip in profit for FY10. The combination of lower ASP and margins would
explain the subdued performance in previous years. (Exhibit 11)
The outperformance in FY09 was driven by lower grain and feed costs, as
well as higher margins from the sale of proprietary brands of fresh meat cuts.
In 2008, management had also carried out a reorganization of operations
and cost cutting initiatives such as reduction of overhead costs, destocking
and reduction of animal inventory.
Profit tripled in FY14 and continues improving for 1H15
Operating profit tripled in FY14 to S$10.2m, on the back of higher ASP due
to a better product mix, as well as lower raw material costs and productivity
gains. We continued to see profits improve for the segment as of 1H15. In
the latest Sep-2015 report by the Australian Bureau of Agricultural and
Resources Economics (ABARES), world wheat prices are expected to average
lower due to ample global supplies, which bodes well for the group’s margins.
Exhibit 11: Primary Production EBIT (FY05-FY14)
40
FY09: Total pork consumption in Australia
grew as impact from global H1N1 flu
pandemic was contained
30
25.7
33.9
FY10-13: High level of cheap imports into Australia
caused a general fall in selling prices of pork
($m)
20
10
15.0
9.0
9.8
10.2
6.8
2.3
0
FY05
FY06
-10
-20
-30
FY07
FY08
FY09
FY10
FY11
-8.4
FY12
FY13
FY14
FY13: Higher animal feed costs due to
drought in certain parts of Australia
FY07-08: Shortages and sharp price
increase of raw materials due to drought
in several grain producing countries
including Australia
-23.6
Source: Company
Exhibit 12: Australian Feed Grain Prices (2005-2014)
450
400
350
300
250
200
150
2005
2006
Barley
2007
Oats
2008
2009
Grain sorghum
2010
Corn (maize)
Source: Australian Bureau of Agricultural and Resource Economics (ABARES)
2014 was estimated based on average prices of Jan-Jun’14
10
2011
2012
Feed wheat
2013
Triticale
2014e
OCBC Investment Research
Singapore Equities
Growth areas
Potential lies in Diamond Valley Pork (Melbourne, Victoria)
Diamond Valley also operates an abattoir and boning business in Melbourne,
Victoria. It slaughters ~658k heads per year, and helps process animals
from both Rivalea and external customers. Melbourne has been cited as a
good growth market, and as such, a major expansion project is currently
ongoing to increase its capacity and capability. The project involves new,
modern automated equipment such as robotics, and other ancillary facilities.
More focus on value-added fresh products
As mentioned above, Rivalea will continue to place focus on producing fresh
products that garner better margins. The group has been launching new
offerings, such as fresh minced products. In line with this strategy, Diamond
Valley Pork has a minced meat and packing line.
Increasing production capacity, facilities and distribution lines
The group also owns a commercial house in Laverton, Victoria, which is
located adjacent to Diamond Valley, and could potentially be used for the
expansion of the company’s business operations in future. The property is
currently sub-let for rental income.
Besides expanding its production capacity and facilities to grow, the group
can enter into new supply chains as well. Back in Jun-10, Rivalea acquired a
wholesale meat trading company, Coral Pork Pastoral Meat Trading Company,
which is a distributor of meats, and facilitated the group’s plan to grow its
presence in Sydney and South East Queensland.
Leveraging on its research capabilities
Rivalea runs one of the largest commercial livestock research and
development centres in Australia, with a team of scientists to support the
company’s operational units. The Research and Innovation Division conducts
research programs and undertakes contract research programs for external
clients, earning them both monetary benefits and knowledge. The division
also sells technical products through its Primegro Technologies brand.
Extensive expertise in product development, production systems and
technology can help strengthen Rivalea’s reputation in the community, while
the group could potentially take on new ventures as well.
iv. Trading and Logistics (T&L) – A distribution business with
proprietary brands
Ben Foods (S) Pte Ltd– wholesale food distribution
Through Ben Foods, the company distributes a range of premium third-party
and proprietary-brand food and beverage products such as meat, milk and
dairy products, wines and juices among others. Some of their house brands
are familiar household names, which includes Cowhead (milk and dairy
products), Farmland (processed meat and foodstuff) as well as Spices of the
Orient (sauces and seasonings). The first two brands also hold Superbrand
status, which is achieved in consideration of several criteria including market
dominance within its product line.
Customers include food manufacturers, F&B outlets, supermarkets and
independent retail outlets, hotels, wholesalers, bakeries, flight kitchens and
sea vessels. Cowhead products are also exported to several regional
countries.
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Exhibit 13: Proprietary brands – Cowhead, Farmland
Source: Company
NCS Cold Stores (S) – public cold store in Singapore
NCS owns and operates an independent public cold store in Jurong,
Singapore. While it is mainly for the group’s own usage, it also enjoyed
higher rental rates from major customers in FY14. The group engaged in
energy-saving initiatives that could save them S$0.12m a year.
NCS has a 62% interest in QAF Fruits Cold Store Pte Ltd, which owns a cold
store for the storage of fresh fruits and vegetables. The cold store has 16
cold rooms and offices that are all leased to third-party tenants.
Financial Performance
Exhibit 14: T&L sales (FY05-FY14)
Exhibit 15: T&L EBIT (FY05-FY14)
120
4.5
4.0
108.3
($m)
100.7
80
91.5
94.5
84.2
90.2
94.8
97.1
74.6
60
4.0
3.5
102.0
($m)
100
3.8
3.0
3.1
2.5
2.0
40
1.5
1.7
1.0
20
0.5
0
2.9
2.5
1.1
0.2
1.3
0.8
0.0
FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14
Sources: Company, OIR
FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14
Sources: Company, OIR
Steady sales
Contributing 10% to the group’s overall sales, the segment has seen
increasing sales since FY08, underpinned by better sales through the launch
of new food products as well as higher rental rates for its cold store. EBIT
has been rather bumpy, mainly due to costs of food products that affect
margins. Nonetheless the difference in profits is arguably not substantial
relative to the other two core businesses.
12
OCBC Investment Research
Singapore Equities
Section C: Industry Outlook
i. Bakery Industry in core markets
Singapore – Hectic lifestyles favour convenient food options
Exhibit 16: Baked Goods market share breakdown in value terms (2014)
Others
Artisanal
Silver Bird Foods (S) Pte Ltd
1.5
55.2
0.1
0.1
0.1
0.2
0.6
1.3
2.3
Apollo Food Holdings Bhd
London Biscuits Bhd
Sheng Siong Supermarket Pte Ltd
Dairy Farm International Holdings Ltd
NTUC FairPrice Co-operative Pte Ltd
Auric Pacific Group Ltd
Gardenia Foods (S)
13.1
25.6
0
10
20
30
40
50
60
Source: Euromonitor International
Gardenia and Sunshine are the top two brands in Singapore
Under the Packaged/Industrial bread market, Gardenia Foods (S) holds a 60%
market share while the next biggest player Auric Pacific Group, which owns
Sunshine and Top-One brands of bread has a 30% share as of 2014.
Gardenia Foods remains a dominant brand with 25.6% value share within
the broader baked goods sector, wherein artisanal players are included as
well as local supermarkets that produce their own in-house brands to target
low-income consumers.
Preference for healthy and novel baked goods
Research from Euromonitor International reveals that in Singapore, hectic
lifestyles and rising preferences for health and wellness products have
pushed demand towards convenient, nutritious and novel food options.
Gardenia and Sunshine have been innovating to offer products targeting at
the health-conscious consumer. Gardenia also has a range of variants under
its Gardenia Country Loaves to take advantage of consumers’ shift to
premium or artisanal bread. The Packaged/Industrial Bread segment value
rose 4.5% in 2014 to S$157m, and given the maturity of the market, its
value is forecasted to grow at 1.1% CAGR over 2014-2019.
Malaysia – Baked goods are ‘indispensable’
Exhibit 17: Baked Goods market share breakdown in value terms (2014)
Others
3.3
Artisanal
58.8
Mese Hsin Tung Yang (M) Sdn Bhd
0.0
Michigan Pastries Sdn Bhd
0.3
Apollo Food Industries Sdn Bhd
0.7
London Biscuits Bhd
1.3
Standard Confectionery Sdn Bhd
1.4
The Stanson Bakeries Sdn Bhd
6.8
Italian Baker Sdn Bhd
9.1
Gardenia Bakery KL Sdn Bhd
18.2
0
Source: Euromonitor International
13
10
20
30
40
50
60
70
OCBC Investment Research
Singapore Equities
Massimo from Italian Baker undercutting Gardenia
Italian Baker leveraged on its parent company FFM Bhd’s flour mills to
aggressively undercut Gardenia‘s prices when it entered the market with the
Massimo brand in 2011. The industry had also taken a toll by allegations of
political linkages, as reported by local media, but Gardenia’s value share has
since recovered gradually. In contrast, Stanson Bakeries, which owns the
High 5 brand, has seen its value share decline over the past five years
(Exhibit 18). Gardenia had a value share of 18.2% within Malaysia’s baked
goods segment in 2014, vs. 9.1% held by Italian Baker.
Exhibit 18: Baked Goods value share of top three players (2010-2014)
% 25.0
20.0
21.4
21.0
18.2
18.0
15.0
16.5
10.0
11.4
11.1
10.4
9.1
8.9
7.5
6.9
5.0
6.8
1.2
0.0
2010
2011
2012
Gardenia Bakery KL Sdn Bhd
2013
Italian Baker Sdn Bhd
2014
Stanson Bakeries Sdn Bhd
Source: Euromonitor International
Baked goods still a daily lifestyle choice
Total Packaged/industrial bread sales grew 2% in 2014 to MYR435m. Its
value is forecasted to grow at 0.6% CAGR over 2014-2019, as consumers
still view baked goods as ‘indispensable’ for breakfast and tea breaks.
Opportunities also lie in the increasing demand for functional bread with high
levels of fibre, vitamins and minerals.
Philippines – Packaged bread has ability to outpace other types of
baked goods
Exhibit 19: Baked Goods market share breakdown in value terms (2014)
Others
Artisanal
Galactica Corp
French Baker Inc
Boulangerie Francaise Inc
SM Retail Inc
Universal Robina Corp
Suncrest Foods Inc
Red Ribbon Bake Shop Inc
Big E Food Products
Regent Foods Corp
MLM Foods Inc
Goldilocks Bake Shop Inc
Gardenia Philippines Inc
10.6
47.1
0.3
0.7
0.9
1.0
1.7
2.7
2.8
2.9
3.1
4.9
10.1
11.3
0
5
Source: Euromonitor International
14
10
15
20
25
30
35
40
45
50
OCBC Investment Research
Singapore Equities
Local players are stronger than foreign co, except for Gardenia
According to Euromonitor International, local companies in the baked goods
sector tend to dominate the foreign players due to their competitive pricing
strategies. Nonetheless, Gardenia Philippines has been able to retain its
leadership position with an 11.3% value share on the back of marketing
initiatives, new products as well as extensive distribution. Its reputation for
quality has also attracted middle- to upper-income consumers.
Healthier choices and new flavours should continue to be well
received
Adding new flavours to the plain bread, such as the pandesal previously
mentioned, should help to improve growth. Again, consumers are looking for
healthier variants in the Philippines, thus opening opportunities for
companies to meet this demand. Packaged/industrial (P/I) bread sales grew
at 8% CAGR over 2009-2014 and reached PHP9.4b in 2014, driven by the
distribution of their products in supermarkets. Euromonitor International
expects this segment to grow at a constant value CAGR of 3.84% over
2014-2019, which is faster than the other baked goods (cakes, pastries).
Exhibit 20: Sales of Baked Goods % Value Growth (2014-2019F)
4.5%
4.0%
3.8%
3.5%
3.0%
2.4%
2.2%
2.5%
1.9%
2.0%
1.5%
1.1%
0.9%
1.0%
0.5%
0.0%
P/I Bread
U/A Bread
P/I Cakes
U/A Cakes
2014-2019 CAGR
Source: Euromonitor International
Unpackaged/Artisanal “U/A”
Exhibit 21: Competitor brands
Source: Companies
15
P/I Pastries
U/A Pastries
OCBC Investment Research
Singapore Equities
ii. Pork Industry in Australia
Demand expected to grow
Consumption of pork in Australia has grown by more than 40% since 1990,
according to BMI Research, and this trend is expected to continue increasing
by 4.7% to 555k tonnes in 2019. Referring to reported data by the
Australian Chicken Meat Federation, the average annual consumption of
meat is 115kg, with per capita pork consumption at 26.6kg/year.
Five year strategic plan launched for Australia’s Pork Industry
Australian Pork Limited (APL) launched its 2015-2020 Strategic Plan in 2014,
aimed at helping the local pork industry generate better returns by riding on
the growing global consumer demand. One aspect of the plan is to help
identify opportunities in new domestic and international markets.
Supply
Exhibit 22: Classification of Piggeries by size, measured by no. of sows as of mid’14
Source: APL
Industry has been consolidating as pork production rises
We note that the industry has been consolidating as the less efficient
producers exit amid shifts to more intensive production methods and
pressure from elevated grain prices. High regulatory and start-up costs are
additional barriers to entry for the industry. As of mid’14, APL data shows a
small number of producers out of a total 1,868 producers dominate
production in Australia. After Rivalea, we estimate Craig Mostyn Group,
which owns Linley Valley Pork, to process about 12% of total number of pigs
in Australia based on available data in media reports.
At the same time, the amount of pork produced has been rising steadily and
the ABARES forecasts pork production to grow from ~360k tonnes in 2014
to 419k tonnes in 2019, directed towards the fresh market.
Exhibit 23: Pork production and over-the-hooks prices (2004-2019F)
Source: ABARES
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OCBC Investment Research
Singapore Equities
Positive trend for pig prices
ABARES forecasts the Australian weighted average over-the-hooks price of
pigs to rise by 6% in 2015 to A$0.335/kg (Over-the-hooks refers to meat
purchased in the carcass stage and paid for by weight). This is on the back
of higher domestic demand for fresh pork due to relatively higher priced
beef and lamb as well as improved export demand on an assumed lower
value of the AUD.
Competitive pressures from imports
Over the medium term, over-the-hooks pig prices see a gradual decline to
reflect the continued pressure from imports in the processed meat segment
(ham, bacon). Growth has been limited due to the general increase in pork
imports from Canada, United States and Denmark. Imports make up about
30% of total pork consumption in Australia, according to a 2013-14 Feed
Grain Supply & Demand report under the Feed Grain Partnership.
Exports were declining, but could have gradual increase
Singapore and New Zealand are the largest markets for Australian pig meat
exports. However, pork exports have been declining over the last decade.
Rivalea’s key export markets are Singapore and Japan, and management
sees opportunities in exporting certain cuts of pork to Asian countries
according to their preference, i.e. loin cut for Japan and pork offal for China.
Exhibit 24: Pork Imports (2005-2016F)
Exhibit 25: Pork Exports (2005-2016F)
Source: ABARES
Source: ABARES
FTAs to offer opportunities
“KAFTA” is one of the latest free trade agreements (FTA) signed between
Australia and South Korea came into effect on 12 Dec last year. The KAFTA,
the Japan-Australia Economic Partnership Agreement as well as ChinaAustralia FTA would offer more growth avenues for Australian producers. A
notable benefit of KAFTA for example is the tariff cuts on pork exports that
would make Australian products cheaper than other competitors in South
Korea.
17
OCBC Investment Research
Singapore Equities
Section D: Key risks
Fluctuations in raw material prices
We previously highlighted that the Australian meat business is susceptible to
fluctuations in raw material prices, mainly grain prices as these impact the
cost of animal feed and profitability as a result. Grain prices are dependent
on the farming season’s weather, quality and yield of crop as well as global
market prices. Flour prices will also affect the production cost for bakery
operations.
Effect of El Nino is not uniform
A key weather event is El Nino, which usually affects rainfall conditions in
Australia. But ABARES research reveals that the effect of an El Nino event on
agricultural production is not uniform, as several instances since 1960 did
not have a significant impact on volume of farm production in Australia. It is
thus difficult to predict the impact of El Nino events on prices of grains.
Exhibit 26: Volume of Australian agricultural production and El Nino
Sources: ABARES, ABS (Australian Bureau of Statistics)
Outbreak of diseases affecting livestock at farms
One of the biggest threats to livestock farming is a health epidemic outbreak,
as this would necessitate a massive culling of pigs and farm closures. To
reduce incidences of cross contamination, Rivalea has put in place
quarantine standards, strategic spreading out of farm locations, and systems
such as all-in all-out (AIAO) and Segregated Weaning Systems (SEW).
Tighter animal welfare restrictions and other regulatory changes
Rivalea’s meat production and exporting business is required to comply with
regulations from foreign regulatory bodies such as Singapore and Japan,
hence it is exposed to regulatory changes such as interventionist foreign
trade policies. The industry itself is also placed under scrutiny for animal
welfare concerns, thus any allegations could paint a negative image for the
group’s products.
Foreign currency risk
The group is exposed to significant volatile foreign currency movements
resulting in a distortion of results due to FX translation from its subsidiaries
to the reporting currency SGD. We understand that management has also
been reducing the inter-company loans made to its Australian subsidies to
mitigate the impact of the depreciation of AUDSGD.
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OCBC Investment Research
Singapore Equities
Section E: Financial Highlights and Forecasts
i. Overview
Earnings continue to achieve growth in 2Q15
QAF’s 2Q15 revenue marginally declined by S$1.1m to S$252.5m, while its
PATMI increased 31% YoY to S$12.2m. The slight decrease in topline was
mainly due to the translation effect of a stronger SGD against the domestic
currencies of countries the group operates in. For instance, the weaker
AUDSGD and MYRSGD made Rivalea and the group’s bakery sales in
Malaysia see lower sales respectively after translating to the reporting
currency terms. Without the translation effect, all of the group’s business
segments had achieved sales growth.
At the same time, the translation effect helped lower expenses. Bakery
operations also had lower overall ingredient costs while reduced utility rates
lowered utilities expenses by 11%. Thus gross profit margin improved 1.1ppt
to 47.2% and operating profit margin was up 1.2ppt to 6.5%. Notably,
Rivalea continued to improve its profitability on higher sales volume coupled
with higher ASP.
Exhibit 27: Quarterly financial highlights
2Q14
2Q15
% Chg
1Q15
% Chg
(S$ m)
(S$ m)
(YoY)
(S$ m)
(QoQ)
253.6
252.5
-0.4%
256.4
-1.6%
-136.7
116.9
-133.3
119.2
-2.5%
-1.8%
1.9%
-135.7
120.8
-57.6
-57.4
-0.4%
-58.1
-1.3%
Amortization and Depreciation
-9.3
-9.1
-2.7%
-9.1
-0.5%
Repairs and Maintenance
-8.0
-7.4
-7.5%
-8.2
-10.4%
Utilities
Other operating expenses
Profit from operations
-9.0
-19.4
13.6
-8.0
-20.8
16.5
-10.9%
6.9%
20.8%
0.3%
21.9%
-6.6
-20.7
17.9
0.0
0.0
NM
0.0
NM
Finance costs
-0.9
-0.6
-29.7%
-0.7
-15.1%
Shares of assoc/JV
PBT
0.0
12.7
0.0
15.9
NM
25.4%
0.0
17.2
-7.5%
Tax expense
PAT
-2.9
9.8
-3.1
12.8
30.9%
0.5
9.3
0.6
12.2
Revenue
Cost of materials
Gross profit
Staff costs
Exceptional items
Minority Interests
PATMI
Source: Company financials
19
6.7%
27.5%
31.0%
-1.3%
-7.8%
NM
-3.3
13.9
-5.7%
0.8
13.1
-26.9%
-8.0%
-6.7%
OCBC Investment Research
Singapore Equities
Largely steady revenue performance
Exhibit 28: Revenue (FY05-FY14)
($m)
1200
1000
800
600
400
200
0
FY05
FY06
FY07
FY08
FY09
FY10
FY11
FY12
FY13
FY14
Source: Company
*Includes only continuing operations
Revenue from continuing operations grew steadily over FY05-FY14, while the
marginal decline in FY14 was due to a FX translation effect, without which
revenue would have increased as well. Details on the main drivers of
revenue growth have been previously covered in the respective business
segments.
Bottom-line has been bumpy, but estimated core PATMI steadier
Exhibit 29: PATMI (FY05-FY14)
Exhibit 30: Core PATMI (FY05-FY14)
50
60
59.2
40
48.8
40
45.1
($m)
34.5
20
43.6
39.1
30
($m)
56.3
30.2
33.0
28.3 29.5 29.6
27.8
20
24.6
21.5
15.5
0
10
4.6
FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14
-2.6
0
FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14
-20
-10
-11.6
-35.2
-20
-40
Source: ABARES
Source: ABARES
Bottom-line has historically been bumpy, partly due to the difficult operating
environment faced by Rivalea in certain years. The group had previously
incurred one-off charges such as impairment provisions in FY07 and a tax
credit of S$18.7m in FY09. In addition, distortion from FX losses were
substantial for some years, such as an FX loss of S$11.5m on inter-company
loans made to the Australian operating subsidiaries was recorded in FY08
whereas a FX gain of S$12.5m was enjoyed in FY09. Doubtful debt
allowances in relation to its loss-making subsidiaries that have been
disposed were made and subsequently written back (for instance, for
Shaanxi Hengxing over FY09-FY11).
20
OCBC Investment Research
Singapore Equities
Stripping out exceptional items and other substantial one-time events, we
estimate core PATMI as displayed in Exhibit 30, whereby the results look
relatively steadier over FY11-FY14.
Leverage
We note that it has managed to reduce its leverage from 2007 onwards on
the back of strong operating cash flows (S$82.7m in FY14).
Exhibit 31: Debt ratios FY05-FY14
(x)
5.0
S$ m
50
13.9
4.5
-35.6
4.0
3.5
3.0
-22.3
-12.0
-40.0
-50
-68.3
-108.8
-150
2.5
2.0
-250
1.5
1.0
-350
0.5
0.0
-0.5
-409.3
FY07
FY08
FY09
Net gearing
Sources: Company, OIR
21
FY10
FY11
Net Debt / EBITDA
FY12
FY13
Net Cash
FY14
-450
OCBC Investment Research
Singapore Equities
Section F: Valuation
Initiate with BUY; S$1.27 TP
We initiate on QAF with a BUY at S$1.27 TP. We value the company through
sum-of-the-parts methodology, and assigned target PER multiples of 14x
and 8x to its Bakery business and Primary Production business respectively
based on reasonable discounts to its peer group average. Considering the
operating mix over the past few years, we assume a 90% PATMI
contribution from the Bakery business while Primary Production makes up
10%.
Among the regional consumer goods peer group, QAF’s Bakery business
turnover was higher than Yeo Hiap Seng and Hanwell in FY14 and was only
slightly lower than Super Group’s. Noting Super Group’s relatively lower PE,
we think its share price has fallen following analyst downgrades amid
disappointing results. For a better indication, the consensus TP for this stock
implies a FY15/16F PE of 19.2x based on Bloomberg consensus earnings
estimates. The average PER for this peer group ranges from 21.9x-25.9x.
In comparison with other integrated producers of animal proteins, our target
PER of 8x for the Primary Production business is at a discount given the
larger size of most of its peers. The average PER for this peer group ranges
from 12.4x-18.1x.
Our fair value estimate implies a 13.6x FY15/16F PER, which is near its
three-year historical PER average.
Exhibit 32: Valuation Methodology
Sum of the parts valuation
Bakery business
Primary Production business
FY15/16F
PATMI
Target
PER peg
Value (S$m)
Value per
share (S$)
46.4
14.0
649.7
1.17
5.2
8.0
41.3
0.07
Less: minority interest
-1.4
-0.003
Add: net cash
13.9
0.03
703.5
1.27
Fair value estimate
Source: OIR
Highest dividend yield among peers
Notably, QAF also offers the highest dividend yield of 5.1% among its peers.
The group has gradually increased its dividends per share over the years,
and DPS has maintained at S$0.05 since FY11 with an average dividend payout of ~67%. We expect DPS to at least maintain going forward.
More details on its peers are shown in Exhibit 33.
22
OCBC Investment Research
Singapore Equities
Exhibit 33: Peer Comparison
Primary
Exchange
Price
(S$)
Mkt
Cap
(S$'m)
Hist
PER
(x)
Est
PER
FY15
(x)
Est
PER
FY16
(x)
PBR
Gross
Margin
EBITDA
Margin
Net
Margin
ROE
Div Yield
EV/
EBITDA
Consumer Goods
Petra Foods
Ltd
Singapore
2.75
1680.7
30.7
34.5
25.5
5.6
31.9
16.2
9.7
13.2
1.4
22.2
Yeo Hiap
Seng Ltd
Singapore
1.32
760.2
25.6
NA
NA
1.1
37.4
7.4
6.6
4.4
1.2
21.2
Singapore
0.25
138.4
21.4
NA
NA
0.5
20.4
4.6
0.6
2.2
0.0
5.4
Hanwell
Holdings
Food Empire
Holdings
Singapore
0.25
130.5
NA
NA
NA
0.7
NA
8.4
-5.3
-9.9
0.0
6.3
Super Group
Ltd
Singapore
0.80
886.7
14.8
16.2
14.5
1.8
35.1
16.5
12.7
12.6
2.7
13.6
Indofood
CBP Sukses
Makmur
Indonesia
1.26
7348.3
25.3
24.5
21.5
5.4
26.8
12.3
8.7
22.3
1.7
15.4
Bursa
Malays
23.9
5595.6
30.1
28.5
26.3
27.9
35.3
17.5
11.4
80.2
3.4
23.1
24.7
25.9
21.9
6.1
31.2
11.8
6.3
17.9
1.5
15.3
Nestle
(Malaysia)
Simple average
Integrated Producers (Animal Proteins)
Japfa Ltd
Singapore
0.29
502.9
10.3
7.5
4.7
0.5
17.2
8.8
1.1
5.8
0.0
6.9
Charoen
Pokphand
Indonesia
Indonesia
0.19
3182.9
22.5
15.8
12.0
2.8
14.2
10.5
6.0
13.2
0.5
16.6
Charoen
Pokphand
Foods
Bangkok
0.84
6482.4
14.6
25.7
16.5
1.3
13.4
5.7
2.5
9.4
2.8
19.1
ASE
1.28
683.5
27.3
NA
NA
0.9
25.3
7.6
1.7
1.3
0.0
28.0
Tokyo
29.1
5941.2
15.5
17.1
16.2
1.4
18.1
5.6
2.6
9.8
1.7
9.5
18.1
16.5
12.4
1.4
17.6
7.6
2.8
7.9
1.0
16.0
12.1
10.9
10.4
1.4
45.7
7.6
4.5
11.8
5.1
8.0
Australian
Agricultural
Company
NH Foods
Simple average
QAF LTD
Singapore
0.99
555.7
Sources: Bloomberg, OIR
23
OCBC Investment Research
Singapore Equities
Company financial highlights
Income statement
Year Ended Dec 31 (S$m)
FY13
FY14
FY15F
FY16F
1,024.2
-558.5
-229.5
-38.3
46.3
-4.1
42.2
31.8
30.2
29.6
1,023.1
-546.5
-227.7
-36.9
61.2
-3.2
57.9
57.9
45.1
39.1
1,035.4
-546.7
-229.9
-37.7
67.9
-3.2
64.7
51.8
50.4
50.4
1,060.3
-558.8
-234.3
-38.5
70.7
-3.0
67.7
54.2
52.8
52.8
FY13
FY14
FY15F
FY16F
79.5
297.3
105.7
688.2
78.9
12.6
264.5
396.8
423.7
688.2
92.4
291.6
109.2
691.1
67.9
10.6
254.3
412.4
436.8
691.1
108.9
288.8
110.6
693.1
65.9
9.6
250.7
436.5
442.4
693.1
126.5
285.4
113.3
718.8
63.9
8.6
251.2
463.0
467.6
718.8
Cash flow statement
Year Ended Dec 31 (S$m)
FY13
FY14
FY15F
FY16F
PBT
Working capital change
Income tax paid
Operating cash flow
Investing cash flow
Financing cash flow
Net change in cash
Cash at beginning of the year
Other adjustments
Cash at end of the year
42.2
4.4
-9.6
79.4
-39.3
-27.8
12.3
70.0
-2.8
79.5
57.9
-3.4
-9.6
82.7
-33.7
-35.6
13.4
79.5
-1.0
92.4
64.7
-4.9
-12.9
87.2
-40.0
-30.7
16.6
92.4
0.0
108.9
67.7
-4.4
-13.5
88.3
-40.0
-30.7
17.6
108.9
0.0
126.5
Key rates & ratios
FY13
FY14
FY15F
FY16F
EPS (S-cents)
NAV per share (S-cents)
PER (x)
P/NAV (x)
Gross profit margin (%)
Net profit margin (%)
Net gearing (%)
Dividend yield (%)
ROE (%)
ROA (%)
5.6
74.0
17.6
1.3
45.5
2.9
3.0
5.1
7.6
4.4
8.2
75.0
12.1
1.3
46.6
4.4
-3.4
5.1
11.1
6.5
9.1
78.8
10.9
1.3
47.2
4.9
-7.7
5.1
11.9
7.3
9.5
83.3
10.4
1.2
47.3
5.0
-11.7
5.1
11.7
7.3
Revenue
Cost of sales
Staff costs
Amortization and Depreciation
EBIT
Net finance costs
PBT
PAT
PATMI
Core PATMI
Balance sheet
As at Dec 31 (S$m)
Cash and equivalents
PPE
Receivables
Total assets
Current financial liabilities
Non-current financial liabilities
Total liabilities
Shareholders equity
Total equity
Total equity and liabilities
Sources: Company, OIR forecasts
Company financial highlights
OCBC Investment Research
Singapore Equities
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