Friday, 28 November 2014

Latitude: Still Looking Good

Latitude Tree FY15Q1 Financial Result

LATITUD FY15Q1 FY14Q4 FY14Q3 FY14Q2 FY14Q1
Revenue 175.7 142.8 146.8 184.4 177.1
Gross Profit 26.2 20.3 23.8 35.8 29.9
PBT 18.5 10.3 14.8 26.0 20.7
PBT% 10.5 7.2 10.1 14.1 11.7
PATAMI 16.6 8.7 12.8 19.0 14.6






MAS Rev 27.7 23.4 32.3 31.6 28.9
MAS PBT 2.3 -0.7 3.0 2.1 1.2
VIET Rev 141.0 114.4 108.1 147.7 142.2
VIET PBT 14.8 13.0 10.9 24.9 20.0
THAI Rev 5.8 5.0 6.4 5.1 6.0
THAI PBT 1.0 -0.4 -0.1 -0.3 0.02






Total Equity 327.2 308.2 296.8 270.1 249.8
Total Assets 502.8 475.3 475.5 530.1 478.6
Trade Receivables 59.9 37.0 49.1 58.2 55.4
Inventories 97.4 93.5 90.7 95.4 81.8
Cash 124.0 123.1 109.0 147.4 116.1






Total Liabilities 173.1 167.9 179.3 205.5 179.3
Trade Payables 91.7 79.1 77.7 95.7 85.1
ST Borrowings 74.8 78.8 91.4 95.5 78.9
LT Borrowings 6.4 7.9 8.9 11.1 12.3






Net Cash Flow -1.6 26.5 11.5 48.2 14.6
Operation 6.1 81.2 55.5 42.2 20.3
Investment -2.7 -37.6 -34.0 -4.1 -1.2
Financing -6.1 -18.5 -5.8 5.0 -8.6






EPS 17.13 8.93 13.12 19.52 15.02
NAS 3.37 3.17 3.05 2.78 2.57
Net D/E Ratio NC NC NC NC NC


Despite slight drop in revenue and PBT YoY, Latitude's FY15Q1's PATAMI improves 14% YoY from RM14.6mil to RM16.6mil due to acquisition of remaining shares in its Vietnam operation.

If compared to preceding quarter of FY14Q4, current quarter's result is much better due to higher orders for better margin products, strengthening of USD against RM, and lost of 8 days production in preceding quarter due to Vietnam riot.

Cash flow in first quarter of FY15 is not so "nice" due to substantial increased in trade receivables. However, this does not seem to be a problem from historical point of view.

Balance sheet remain strong with cash inches up while total borrowings are reduced.

As US economy is in the process of recovery, I think this will only benefit Latitude in the near term.

Latitude's 8.5sen dividend for FY14 disappoints most investors I guess, as the payout ratio is just 15% compared to previous year's 25%.

Hopefully the management will make good use of its cash to expand its business.




Since early Oct14, Malaysia's famous investor Mr Koon YY has been collecting Latitude's shares. He currently owns 6.21% of Latitude.

Another famous investor Fong SL has reduced its stake in Latitude from 1365k to 530k. He might have bought the shares at below RM1 in early 2013 and has earned 300% in one year from Latitude.

For me, I will not sell at this stage. 

I will keep my previous target price of RM4.53 base on FY14 actual EPS and PE of 8x.

At share price of RM3.70, Latitude's actual PE ratio is just 6.5x, compared to Homeritz's PE ratio of 8.2x at 83sen per share.

4 comments:

  1. 没风没浪又一季,继续留守

    ReplyDelete
  2. But I have one concern regarding the profit margin for its Vietnam plant being dropped a lot. Management said it was due to higher wage costs.

    ReplyDelete
    Replies
    1. Yea, hopefully it won't fall further..

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