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Author: kimeng   |   Latest post: Mon, 23 Jul 2018, 10:26 AM

 

SATS Limited: FY17 Largely Within Expectations

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SATS Limited (SATS) ended its FY17 with no surprises as 4QFY17 revenue grew 2.0% YoY to S$425.8m, and operating expenses rose 3.3% to S$380.0m driven by increases across all expense categories except for cost of raw materials. SATS also recorded a negative goodwill of S$15.0m arising from increased stake in a long-term investment in 4QFY17 but excluding it, core PATMI grew 1.8% YoY to S$51.6m.

For FY17, core PATMI was largely within expectations as it increased 7.4% to S$234.3m and formed 96% of our forecast. FY17 revenue rose 1.8% to S$1,729.4m, mainly attributable to growth across both Food Solutions (+0.6%) and Gateway Services (+3.4%).

Operating expenses, however, grew at a slower pace than revenue, mainly driven by higher staff costs due to service increment and higher subcontract costs to support increased business volumes but mitigated by fall in cost of raw materials with the transfer of food distribution business to its JV. Consequently, operating margin improved from 12.6% in FY16 to 13.3% in FY17.

SATS is also recommending final dividend of S$0.11, bringing the total dividend for FY17 to S$0.17 (FY16: S$0.15). Pending management briefing later, maintain HOLD on SATS, but our FV of S$4.70 is under review.

Source: OCBC Research - 19 May 2017

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Labels: SATS

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Chart Stock Name Last Change Volume 
SATS 5.15 -0.02 (0.39%) 1,697,500 

Market Buzz

Date Type Subject
20-Jul-2018 Price Target SATS - 1QFY19 Strong Operating Leverage; Cruise Business and China Food Solutions to be Growth Levers
Source : UOB KayHian, Price Call : BUY, Price Target : 6.10
Last Price : 5.15, Upside/Downside : +0.95(18.45%)
20-Jul-2018 Price Target SATS Ltd: Good Turnaround at Various Levels
Source : PHILLIP CAPITAL, Price Call : BUY, Price Target : 5.58
Last Price : 5.15, Upside/Downside : +0.43(8.35%)
20-Jul-2018 Price Target SATS - A strong 1Q but the Turkish Delight is off the menu
Source : Maybank Kim Eng, Price Call : BUY, Price Target : 5.90
Last Price : 5.15, Upside/Downside : +0.75(14.56%)
20-Jul-2018 Price Target SATS - Raising Dividend Expectation
Source : DBS Vickers, Price Call : BUY, Price Target : 5.65
Last Price : 5.15, Upside/Downside : +0.50(9.71%)
20-Jul-2018 Blog SATS - a Strong 1Q18 But the Turkish Delight Is Off the Menu
20-Jul-2018 Announcement Change - Change in Corporate Information::Incorporation of a Wholly-owned subsidiary - SATS China Co., Ltd.
19-Jul-2018 Announcement Change - Announcement of Cessation::Retirement of Non-Executive Independent Director
19-Jul-2018 Announcement Change - Announcement of Cessation::Retirement of Non-Executive Independent Director
19-Jul-2018 Announcement REPL::Annual General Meeting::Voluntary
19-Jul-2018 Announcement Employee Stock Option/ Share Scheme::Notice of Transfer of Treasury Shares
19-Jul-2018 Announcement Financial Statements and Related Announcement::First Quarter Results
19-Jul-2018 Announcement Asset Acquisitions and Disposals::Memorandum of Agreement with Turkish Airlines
19-Jul-2018 Announcement General Announcement::45th Annual General Meeting Presentation

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