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Open Letter to Board of Metro Holdings
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Joelton
Supreme |
26-Jun-2020 09:20
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Metro H2 profit plunges 81.9% to S$11.3m on lower revenue
METRO Holdings posted an 81.9 per cent plunge in net profit to S$11.3 million for the half year ended March 31, 2020, from S$62.4 million a year ago.
This came as the property investment and retail group' s revenue for the period fell 14.6 per cent, dragged by lower sales from its retail division, partially offset by higher contributions from Metro' s property segment.
Earnings per share stood at 3.9 Singapore cents for the full year ended March 31, 2020, down from 11.6 cents a year ago, according to Metro' s financial results released on Thursday.
Revenue for the second half of the year fell 14.6 per cent to S$81.5 million, from S$95.5 million a year ago.
Metro' s retail segment reported a 33.9 per cent drop in sales to S$47.2 million due to Metro Centrepoint' s closure in October 2019 and lower sales in Singapore due to shortened operating hours in February and March 2020 amid the Covid-19 situation.
The group' s property division revenue rose 42.3 per cent to S$34.3 million, lifted by S$11 million in contributions from the sale of property rights for its residential development projects in Bekasi and Bintaro in Jakarta.
A final cash dividend of two Singapore cents per share was recommended for the full year, down from a final dividend two cents and a special dividend of 2.5 cents a year ago. The date payable will be announced at a later date.
For the full year ended March 31, 2020, net profit tumbled 66.5 per cent to S$32.2 million, while revenue was up 22.3 per cent to S$210.3 million.
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Starship
Supreme |
30-Aug-2019 13:59
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Opposite of Robinsons? The Sale Not Worth Waiting For?   
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investshare
Supreme |
30-Aug-2019 10:00
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Smdj? | ||||
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Starship
Supreme |
29-Aug-2019 14:17
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And Marina Square kids..................................  
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laksaman57
Supreme |
29-Aug-2019 12:02
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"Metro is holding clearance sales at The Centrepoint and will shut its flagship outlet on Sept 15"
Sale Sale Sale 📣 |
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bishan22
Supreme |
27-Aug-2019 19:27
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They need tourist $ to sustain but too bad many tourists give Sg a miss and gone to other countries... very charm....
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Starship
Supreme |
27-Aug-2019 19:14
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This store is just 5 years old. Robinsons moved out bcos Centrepoint was dying a slow but constant death. Yet, Metro foolishly moved into the prepared coffin to die. I visited when it opened and a few more times since. All during weekdays afternoons. It was like a ghost town. At every floor, less than 5 shoppers browsing. And the rest of the building is also like a ghost town with tons of stores without tenant. It' s the complete opposite of the Centrepoint Kids era when the entire building was always full of shoppers, bustling and noisy. during those good times, the Great Robinsons Sales were always jammed packed with shoppers in a frenzy not unlike The Train To Busan. 
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TA_Expert
Supreme |
27-Aug-2019 15:49
Yells: "The World has changed" |
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Metro is closing the flagship store at Centrepoint. Retail business is dying. | ||||
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investshare
Supreme |
07-Aug-2019 09:15
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Good or Not? | ||||
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FaceTheFact
Member |
24-Apr-2019 23:07
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https://www.businesstimes.com.sg/companies-markets/metro-jv-acquires-grade-a-tampines-office-building
20 Apr 2019 (Sat) METRO Holdings unit Metrobilt Construction has entered a 50:50 joint venture to acquire 7 and 9 Tampines Grande, a premium Grade-A office property, the group said on Thursday night. While the purchase price was not disclosed, sources put the figure to be S$395 million. Metro' s 50 per cent capital commitment for the investment is about S$45.6 million. Metro said the investment is in the ordinary course of its property investment and development business. Through the investment, Metro aims to gain exposure to Singapore' s Grade-A decentralised office market. " The Singapore commercial market, particularly the decentralised office micromarket, is at an inflection point and is poised to deliver strong growth over the next few years," said Cushman & Wakefield capital markets group executive director Shaun Poh. The sale " demonstrates investor confidence in this tightly-held Grade-A micromarket" , he added. |
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Starship
Supreme |
24-Apr-2019 12:33
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What a joke. The letter in the thread title was fm 2016. Now 2019, yet nothing has changed except for a post just popped up.............................  |
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jm2212
Veteran |
23-Apr-2019 22:45
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What's it that metro is planning to buy with the new bond issue? They have so much cash.... | ||||
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ysh2006
Supreme |
22-Dec-2018 11:25
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Is this statement still valid ?...Metro still okay lah!!
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Qanghoo
Supreme |
20-Dec-2018 17:10
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So many property stocks trading at deep deep discounts. UOL, Ho Bee, HKLand, Guockland, Tuan Sing ..... u name it ..... Metro is no exception, so kpkb for what? Just quit SGX n go trade DJ stocks lor .......
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investshare
Supreme |
20-Dec-2018 15:35
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** quote It is thus inconceivable that Metro&rsquo s share price continues to languish at SGD 0.915, trading at a deep discount of 43% to its intrinsic book value of SGD 1.61 per share despite the company&rsquo s strong recurring earnings profile and valuable assets. We attribute this severe undervaluation to the following key reasons: |
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dragonboy76
Master |
04-Oct-2016 17:09
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now is the time to accummulate and wait for extraordinary dividend and share price upswing. not surprised if this is surge to $1.20 in due time. vested. |
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hem2998
Veteran |
04-Oct-2016 16:43
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wow! they can move market...means something' s up.....
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jm2212
Veteran |
04-Oct-2016 11:47
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take it pte....i' m waiting
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supervard
Member |
04-Oct-2016 11:32
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QUARZ CAPITAL MANAGEMENT, LTD. ISSUES OPEN LETTER TO THE BOARD OF DIRECTORS OF METRO HOLDINGS (SGX: M01) . ALL RECIPIENTS ARE ADVISED TO READ &ldquo IMPORTANT DISCLOSURE INFORMATION&rdquo AT THE END OF THE ATTACHED LETTER . Quarz Capital Management, Ltd. Clifton House 75 Fort Street George Town I KY1-1108 I Grand Cayman Cayman Islands 4 October 2016 To Engage on the Proposals for an Extraordinary Cash Dividend and Clearer Communication of Corporate Strategy to unlock a potential Total upside of > 40% in Metro&rsquo s Share Price Dear Members of the Board, As a long-term shareholder of Metro Holdings (the &ldquo Company&rdquo , &ldquo Firm&rdquo ,&rdquo &ldquo METRO SP&rdquo or &ldquo Metro&rdquo ), we congratulate the board on the appointment of Mr. Lawrence Chiang as the acting Group CEO and Executive Director of Metro. Mr. Chiang has been a key part of the team led by the visionary Mr. Jopie Ong who transformed Metro from a reputable domestic retailer to a global property player with a strong real estate portfolio in Singapore, China, and the UK. Despite being a household name in retail, Metro&rsquo s current retail operation contributes to less than 0.5%[1] and 5% of its FY16 net profit and net asset valuation respectively. In spite of being a mid-cap stock, Metro has the 2nd largest net cash holding among listed companies in the SGX, amounting to SGD 393 million[2], more than half its current market capitalization of SGD 758 million[3]. This is in addition to the attractive dividend yield of 7.7% the company paid in FY2016. Together with the loans to its JVs of SGD 133 million4 and listed equity investments of SGD 111 million, Metro&rsquo s net cash, loan receivables and liquid investments total SGD 637 million, amounting to more than 80% of its current market capitalization. Metro&rsquo s property development and investment portfolio is valued in excess of SGD 600 million[4]. It&rsquo s Grade A diversified investment properties are located in the prime areas of Shanghai and Guangzhou with anchor tenants including Exxon Mobil, Swatch, Abbott Laboratories, and Roche. This portfolio provides a recurring unlevered net rental income in excess of SGD 30 million[5] per annum. Progressive profit recognition and capital return from the delivery of its Nanchang Fashion Mark (China) mixed-use development project, Sheffield Digital Campus (UK), Manchester Middlewood Locks (UK) and The Crest @ Prince Charles Crescent (Singapore) will further boost Metro&rsquo s net profit and cash flow in the next few years. Metro&rsquo s retail division which accounts for 4%[6] of Metro&rsquo s total gross asset value is right-sizing its Singapore operation to match the new retail landscape. It is thus inconceivable that Metro&rsquo s share price continues to languish at SGD 0.915, trading at a deep discount of 43% to its intrinsic book value of SGD 1.61 per share despite the company&rsquo s strong recurring earnings profile and valuable assets. We attribute this severe undervaluation to the following key reasons: Firstly, the firm holds an excessive net cash balance which has been largely under-utilized and low yielding. Investors are worried about the inefficient allocation and potential mismanagement of this sizeable cash balance. This is exacerbated by Metro&rsquo s insufficient communication with investors with regards to its strategy in its key real estate division beyond the opportunistic acquisition and divestment of property assets and development projects. Lack of management access (reflected by no sell-side coverage and low institutional shareholding level) and hard to decipher financial results add to the complexity of understanding the intrinsic value and strong cash flow profile of Metro. This partly results in lower trading liquidity, reduces the investability, and increases the substantial discount to intrinsic value of Metro&rsquo s shares. Low shareholding level and the lack of share-based compensation as part of management&rsquo s remuneration might have also resulted in the de-prioritization of Metro&rsquo s share price as a key management KPI. We are in agreement with Metro&rsquo s board and management that the company should retain a proportion of cash to take advantage of strategic opportunities in the asset-heavy fields of property development and investment. However, it is evident that the maintenance of a net cash balance of SGD 393 million which will potentially increase to more than SGD 500 million in the next 2-3 years with minimal usage of debt is excessive. We believe that now is the time that Metro takes the decisive step to close this substantial valuation gap by distributing SGD 150 &ndash 200 millions of excess cash to shareholders (amounting to SGD 0.21/share or a 23% dividend yield). The remaining net cash balance and liquid investments of more than SGD 329 million will be more than sufficient for Metro to execute on its long term strategy of value creation and to pay its recurring dividend. We urge Metro to implement a clear dividend return policy and a shareholder accretive buyback programme to repurchase shares whenever the share price discount to NAV breaches > 40%. The wider investment community will also appreciate the company in providing a clear and coherent strategy of its real estate division. Deeper insights on the focus countries, type of properties and the profitability criteria which the division uses to evaluate potential investments and projects will support investors in better understanding the strategy and operations of this key division. We recommend Metro to strengthen its investor relations work by enabling frequent institutional access to management (commonplace among high quality SGX-listed firms) and to provide better quality and quantity of reported financial metrics such as recurring rental income, lease expiry profile (for the next few years), as well as forecasted rental rate trends, development margins and profit. We also support a transparent link between the remuneration of management with Metro&rsquo s long term profitability and share price. In this respect, we recommend their remuneration package to include a sizeable proportion of share-based compensation which will vest upon fulfillment of key KPIs. For your convenience, we have summarized our thoughts and recommendations in a short presentation: LINK: https://www.quarzcapital.com/en/research/metro-holdings The foresight and execution ability of the late Mr. Jopie Ong and his team have provided a strong foundation for Metro Holdings. We are confident that the current team has the capability and pedigree to lead the company to greater heights. The return of excess capital, clear corporate strategy, and proactive investor relations can result in Metro&rsquo s share price to trade at a higher valuation permanently and provide a significant upside of more than 40% by 2017 to all Metro shareholders. Sincerely yours, Mr. Jan F. Moermann Chief Investment Officer, Quarz Capital Management, Ltd. Mr. Havard Chi, CFA Portfolio Manager, Quarz Capital Management, Ltd. For further information, please contact: Havard Chi, CFA ([email protected] , +65 9433 3898) Link to the Letter: https://www.quarzcapital.com/en/research/metro-holdings [1] Retail operation contributes SGD 0.14m to Metro&rsquo s total Net Profit of SGD 113m in FY16 [2] Dividend payment of SGD 58m and liabilities of SGD 28m subtracted from cash holding of SGD 479m reported in Metro&rsquo s FY1Q17 Financial Statement [3] Stock price of SGD 0.915 multiplied by outstanding shares of 828m reported in Metro&rsquo s FY1Q17 Financial Statement [4] Valuation of investment portfolio based on Metro&rsquo s FY2016 Annual Report. Valuation of development properties based on Top Spring International&rsquo s 1H16 Financial Statement and QCM estimates (based on median profitability of property developers in the UK) [5] Based on annualizing rental income reported in Metro and Top Spring&rsquo s FY1Q17 and FY1H16 Financial Statements [6] We value Metro&rsquo s Singapore retail operation at a valuation of 0 in spite of its equity position of SGD 23m due to its loss making profile. Indonesia operations valued at P/E of 20x CY15A, at a discount to more established peers (Matahari P/E 31x CY15, Ramayana P/E 26x CY15)
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