Monday 16 February 2015

Tambun: As Expected

Tambun Indah FY14Q4 Financial Result

Revenue 110.1 116.8 128.0 112.0 118.4
Gross Profit 38.8 43.8 38.1 39.9 40.4
Gross% 35.2 37.5 29.8 35.6 34.1
PBT 35.1 34.8 33.1 35.3 36.3
PBT% 31.9 29.8 25.9 31.5 30.7
PATAMI 25.9 25.5 25.4 25.3 22.1

Total Equity 397.0 377.9 351.0 336.0 310.1
Total Assets 661.8 636.8 676.1 596.9 496.9
Trade Receivables 118.0 117.0 106.8 99.1 86.6
Prop dev cost 72.5 83.9 57.2 96.4 125.1
Inventories 2.4 0.3 0.3 0.3 0.3
Cash 131.5 151.1 194.4 142.8 125.9

Total Liabilities 262.4 256.6 323.0 258.7 183.3
Trade Payables 103.9 93.1 102.0 93.1 81.1
ST Borrowings 35.2 13.8 38.3 39.5 24.8
LT Borrowings 117.7 133.2 164.7 116.6 73.3

Net Cash Flow 17.7 37.3 80.6 29.0 24.3
Operation -5.5 3.0 -23.1 -23.0 57.9
Investment -12.8 8.5 2.4 4.1 -21.4
Financing 36.0 25.8 101.3 47.9 -12.2

EPS 6.24 6.22 6.34 6.41 6.14
NAS 0.94 0.92 0.86 0.85 0.79
D/E Ratio 0.05 Net cash 0.02 0.04 Net cash

Tambun's FY14Q4 result is flat with revenue drops 5.7% while PATAMI rises 1.6% to a record high of RM25.9mil compared to preceding quarter of FY14Q3.

This "record" quarterly profit is helped by fair value adjustment on investment properties amounting to RM2.6mil in current quarter.

Anyway, Tambun has achieved something special which is PATAMI of RM25+mil for all 4 quarters in a financial year.

Tambun registers new sales of RM81mil in Q4 compared to RM74.1mil in Q3. Total sales is RM429mil in FY14 compared to RM500mil in FY13.

This means that FY14 second half sales drop significantly from first half.

Unbilled sales drop from RM457.3mil to RM427.4mil at the end of FY14.

RM mil FY14 FY13 FY12 FY11 FY10 FY09
Revenue 466.8 376.4 296.7 191.8 128.1 100.9
Revenue growth % 24.0 26.9 54.7 43.7 27.0
PBT 138.2 117.7 79.0 46.8 36.2 30.0
PBT% 29.6 31.3 26.6 24.4 28.3
PATAMI 102.1 65.0 40.8 23.4 25.2 23.9
PATAMI growth % 57.1 59.3 75.1 -7.1 5.4

EPS 25.20 19.77 14.93 10.74

NTA 0.94 0.79 0.72 0.70

ROE 25.7 21.0 18.3 15.0

Overall FY14's revenue and PATAMI reach RM466.8mil and RM102.1mil respectively, which are 24% and 57% higher compared to FY13.

ROE reached an excellent level of above 25.

EPS stands at 24.2sen (base on today's outstanding shares of 421.5mil) and base on fair PE ratio of 8x, my target price will be RM1.94.

A minimum dividend payout of 40% will see its FY14 dividend at minimum 9.6sen. So after first interim dividend of 3sen, it should pay at least another 6.6sen later likely in September.

Dividend yield is at 5% at share price of RM1.90.

       Latest progress of GEMS International School

       Latest progress of Pearl City Mall

As mentioned in earlier articles, Tambun will only concentrate on its Pearl City for its new launches, unless it acquires lands elsewhere.

It will launch the first high rise project in Pearl City (Avenue Garden) sooner than expected in the first half of 2015.

Avenue Garden is a serviced apartment that offers units with built-up area from 700 sq ft and priced from RM248k. It is located next to GEMS International School and future Tambun Indah corporate tower.

The price of RM350 psf is not cheap but I have a friend who is ready to buy. I am keen to know what kind of response this project can get.

According to analyst, Tambun plans to launch projects worth RM500mil in FY15. So I would expect even or lower sales in FY15 compared to FY14.

In my opinion, Pearl City is still an attractive township especially after the completion of GEMS International School, Pearl City Mall and Jit Sin High School SPS branch.

It is even better if the proposed medical center could be materialized.

       Pearl City Master Plan (latest)

It seems like Tambun may not sustain the tremendous growth it shows for the past 4-5 years, especially in current soft property market.

I believe that its management are surely busy scouting for more strategic land and this will be a "re-rating catalyst" for its stock.

Hopefully investors can hear the good news soon.


  1. Hi, it's me again BD, im impressed that u're still contributing to the community when reaching CNY.

    For Tambun, I finally 认命 after the newly announced result.
    Profit mostly made up of prop revaluation, rev had started to fall from peak.

    I sold it today n enjoying a realized loss of 20%.

    Now im free of prop stock as i'm super bearish on prop

    U may call me Dr Doom of property

    1. Hi, it's true that good stocks can make us lose money, depends on the timing of our entry & exit. Tambun's earning has reached bottle-neck so it's only keep for dividend for me. I'm confident that Pearl City can still sell well. I regret that I didn't unload most of its shares when it reached above RM2.50...

  2. I went raintree park show house before, once open car door, can smell "good" smell, i suspect come from valdor poultry farm.Good luck for those who want to buy there. be preapare for full face mask respirator for outdoor activity...haha

    duplex is long type with infront parking almost one car pouch only,very small. while 2storey terrace has wide front spacing, corner house is prefect thou.

    1. Hi chiwawa, there are poultry farms just next to Pearl City. The smell is not from Valdor I think as it's too far away. I'm a bit surprised as its property still gain good response so far despite this setback (smell & flies). Anyway, I believe that the farms will have to give way sooner or later.

      Duplex is actually townhouse, so the "back to back" type of car porch is common.