STRAITS Trading : S20 0%on Thursday (Jan 18) said it will issue S$130 million notes due 2029 at 4.7 per cent.

 

The notes, to be issued at par on Jan 24, fall under the investment company&rsquo s S$500 million multicurrency debt issuance programme established in 2011 and updated in 2017.

 

Net proceeds from the issuance will be used for general corporate purposes, including financing existing borrowings, working capital and capital expenditure requirements, the company said.

 

DBS and UOB have been appointed joint lead managers and bookrunners for the bond offering.

 

INVESTMENT company Straits Trading : S20 -0.51% has launched a new product that provides fractionalised exposure to real estate as it seeks to improve accessibility to properties that have high barriers to entry.

 

The mainboard listed company said on Sunday (Sep 10) that it has launched two new property investment products under its Fractionalised Investment Real estate-Straits Trading (FIR-ST) programme.

 

The underlying properties being offered are a freehold Good Class Bungalow (GCB) at 8A Cable Road, Chatsworth Park, and a 999-year leasehold condominium unit in Duchess Residences at Bukit Timah.

 

Under the FIR-ST programme, investors will gain exposure to the residential properties at a fraction of their value through preference shares. The underlying properties will continue to be owned by the existing owners during the investment period, Straits Trading said.

 

The minimum investment amount into the Duchess Residences condominium is S$200,000, while investors who want to invest in the GCB will need to set aside a minimum sum of S$500,000.

 

Straits Trading noted that preference shareholders &ldquo may receive dividends, which will be paid on a semi-annual basis&rdquo .

 

It added that &ldquo preference shareholders may enjoy returns which reflect a share in the potential appreciation in value of the underlying property via a special payout&rdquo at the end of the expected investment period of five years.

 

Straits Trading said the dividends and special payout are non-guaranteed and subject to performance.

 

Both investments are offered to Strait Trading Shareholders&rsquo Club registrants only. Shareholders who hold at least 100 shares of Straits Trading can register with the Shareholders&rsquo Club.

 

Straits Trading said it worked with advisers including Dentons Rodyk & Davidson, Deloitte, EY, Cushman & Wakefield, and Knight Frank to come up with the investment products.

 

The Straits Trading Company has reported 1HFY2023 earnings of $14.9 million, versus $673 million recorded in the year.

 

The big drop can be attributed to the one-off recognition of $658.6 million in 1HFY2022 following the sale of its stake in ARA Asset Management.

 

If this gain is excluded, Straits Trading would have reported an ebitda that is 11.7% higher y-o-y, and profit after tax that' s 19.2% lower y-o-y.

 

Besides the absence of the one-off disposal gains, Straits Trading was hit by much higher finance costs of $40.6 million, versus $17.2 million in 1HFY2022.

 

Revenue in the same period was $202 million, down 17.7% y-o-y, with part of the drag from lower sales in its resource segment.

 

Straits Trading says it remains proactive in managing interest rate and foreign exchange volatilities through hedging. For example, it recently issued $370 million in exchangeable bonds, which will give it " favourable" cost of funding, financial flexibility, and increased resilience to operate in the current environment.

 

As of June 30, Straits Trading holds $354.5 million in cash and cash equivalents, compared to $251.7 million in Dec 31 2022.

 

&ldquo Our resilient 1H2023 results, coupled with our sound balance sheet puts us in a good position to navigate the current headwinds and positions our businesses for sustained growth," says executive chairman Chew Gek Khim.

 

" We remain committed to enhancing shareholder value through our Straits 5.0 transformation by introducing innovative growth engines for the company, and deepening our relationship with shareholders through meaningful engagement and unique co-investment opportunities," she adds.

 

As at June 30, the company' s NAV per share was $3.59, down from $3.86 as at Dec 31 2022.

 

The Straits Trading Company has reported earnings of $551.3 million for FY2022, up 135% versus $234.3 million recorded in the preceding year ended Dec 31 2021, thanks to divestment gains of its stake ARA Asset Management.

 

Revenue in the same period was up 33% to $527.6 million, with higher contributions from its various business segments.

 

For 2HFY2022, the company booked a fair value loss of $75.4 million on its investment properties portfolio, versus a gain of $133.4 million made in FY2021.

 

This brings 2HFY2022 losses to $122.5 million, versus earnings of $144.1 million.

 

In the past year, the company completed the acquisition of a portfolio of office and industrial buildings and several plots of development land in the Gloucester Business Park in the UK.

 

To further diversify its portfolio, it also acquired a remaining 20% stake in its logistics portfolio in Australia - part of Straits Trading' s wider multi-asset, multi-market strategy.

 

Straits Trading owns stakes in the hospitality business, such as its 30% share of Far East Hospitality Holdings. During the year, this business segment returned to profitability with an ebitda of $0.8 million.

 

Now, given the global uncertainties, Straits Trading prefers to remain cautious and will continue to adopt prudent financial management and explore opportunities to drive long-term sustainable growth.

 

Elsewhere, its resources segment, mainly via its separately listed, 52%-owned Malaysia Smelting Corp, has reported an ebitda of $54.6 million in FY2022, down from $59.5 million, due to higher energy costs which made smelting more expensive.

 

MSC, says Straits Trading, will continue to focus on improving operational efficiencies in its smelting and mining segments.

 

&ldquo Our FY2022 results demonstrate the resilience of our conglomerate business model with diversified operations and interests across several markets,&rdquo says executive chairman Chew Gek Khim.

 

&ldquo As such, we were able to grow from strength to strength, and deliver superior value to our stakeholders.

 

&ldquo We aim to build on this momentum by continuing our efforts under the Straits 5.0 Transformation,&rdquo she adds, referring 137-year-old company' s latest growth stage.

 

Straits Trading warns that the current FY2023 will remain &ldquo challenging&rdquo because of higher energy prices, interest rates, and labour cost.

 

&ldquo The group will continue to stay disciplined and prudent in its investment approach as it navigates forward,&rdquo the company says.

 

Straits Trading plans to pay a dividend of 8 cents &ndash which is on top of the distribution in specie equivalent to 50 cents already made earlier in FY2022.