德林走出低谷 擬派末期息

德林走出低谷 擬派末期息

2009年9月29日

【明報專訊】毛絨玩具製造商德林國際(1126)執行董事總經理李泳模表示，公司業績已「見底」，相信經營將會持續改善，現正考慮在全年度業績時派末期股息，派息比率或達盈利的三分一，唯他強調，對經濟前景仍較為謹慎，派息與否需視乎全年業務表現。德林上半年業績轉虧為盈，錄得盈利3890萬元，不派中期息。

他 績稱，玩具業整合令部分競爭對手遭淘汰，市場整體產能下降，令公司市場佔有率增大，聖誕接訂單情因而按年有所上升。他相信，公司下半年銷售額將有望繼續 提升，並有信心毛利率可維持上半年27.3%的水平。另外，公下半年資本開支約300萬美元，主要用於越南新廠投資及營運。

Dream Int’l (1126.HK) 2009 interim results

The 2009 interim results of Dream Int’l (1126.HK) came out last Friday night and was better than I expected, with sales growing 13% YoY and gross margin being very strong at 27% (up from 13% in the first half of 2008).

The Company also booked a $21m gains from disposal of Jiangsu plant (originally thought it would be booked in second half of 2009) and paid 6% effective tax rate (thought it would be 15%).

So overall net profit was $38m, which is a great number. The Company’s balance sheet is very strong with $200m cash and $50m debt, and it also seems to be managing its working capital well.

I expect the Company to make another $30-35m in net profit for second half of 2009, bringing total net profit in 2009 to $68-73m. And I anticipate that the Company will resume paying dividends for full-year 2009 (after skipping for 3 years) of 0.05/share.

Given the strong set of results, I think the Company’s share price should reach $0.60 (1x P/B) within two months, and $0.80 within a year (7x P/E, 6-7% dividend yield).

RECOMMEND BUY NOW AT $0.42. TARGET $0.60 BY NOVEMBER 2009 AND $0.80 BY SEPTEMBER 2010.

p.s. you may download the interim report from: http://www.dream-i.com.hk/tc_chi/announce.html

Dream (1126.HK), AMVIG (2300.HK), HuaFeng (364.HK)

After reviewing the interim results of Sewco (209.HK), I have revised downwards my sales expectation for Dream Int'l (1126.HK) in 2009. On the other hand, Sewco's gross margin was much better than I expected (i.e. rose from 5% in 1H'2008 to 15% in 1H'2009). Sales decline and margin expansion should offset each other to a large extent for the bottom line. Overall, my expectation for Dream Int'l remains the same. Dream Int'l will have a great year in 2009.

Two new stock ideas I developed --

AMVIG (澳科, 2300.HK, $3.4 now)- stable cigarettes packaging industry, AMVIG is #1 market leader with 12% market share, stable margins, strong cash flow, net cash position (i.e. cash > debt) after recent disposal of an under-performing subsidiary. Stock price has been over-penalized these days. Target price is $4.8-$5.4, representing 12x of what I see as the normal, post-subsidiary disposal EPS of $0.40-$0.45. Big upside if the company pursues further business acquisitions or if there's a privatization / takeover bid (AMVIG would actually make a very good MBO/LBO candidate).

HuaFeng (華豐, 364.HK, $0.33 now) - reputable textile company, Huafeng has demonstrated resilience in earnings during economic downturn. EPS for 2009 is expected to be around $0.075 (excluding one-time gain of $0.06), representing 4.4x P/E. P/Book is 0.33x. Management has publicly said that there has been a pickup in orders since June 2009. Huafeng has net cash of $267m (vs. market cap of $409m) that should support generous dividends for next few years. Target price is $0.52-0.60, representing 7-8x (which is the normal, mid-cycle P/E range) of expected EPS in 2009, without giving any consideration to the net cash. Big upside if the management declares large special dividends.

I don't think I'll be able to come up with any more new stock ideas for next two months (it's a very time-consuming process), but I'll *try* to post weekly on this blog for updates about companies that I have recommended and/or other general market observations and/or interesting research reports that I come across (e.g. the JPMorgan one).

德林國際(1126.HK)

德林國際(1126.HK)的股價今天再漲18%至$0.42，而且成交量進一步上升。我認為，短期內(8至10個月)合理價格應為$0.60(代表還有40％上漲空間)。但極短期內(1至2個月)追貨有一定的風險。

p.s. 我正研究另一間上市公司(製衣業的)，如結果值得分享，我將在兩至三個星期內張貼。

德林國際(1126.HK)

德林國際(1126.HK)的股價今天漲了22%，而成交量配合且是近月之最，但股價仍然遠低於其內在價值。建議在$0.31-0.33附近累積。

德林國際(1126.HK)的中期業績

另一毛絨玩具製造商祟高國際(209.HK)將於9月21日公佈中期業績。你應注意該公司的整體盈利能力，特別是毛利率。這對德林國際的中期業績(於9月25日公佈)有參考作用。請注意，德林國際歷來的利潤率均高於祟高國際

潛在10倍股

有一份新的JP Morgan研究報告關於"潛在10倍股"。想要的話，請在這裡sign-up：
http://spreadsheets.google.com/viewform?hl=en&formkey=dGVxVDFHZ1RxT082YjJEUV9oRzdJaXc6MA..

大概會每2-3個工作天發一次。

Dream International (德林國際, 1126.HK)

I am reading the book, Security Analysis, by Graham and Dodd. I will put Dream International (德林國際, 1126.HK) in context and see how well it fits the authors' value investing criteria, and share my sights later here.

Those of you who bought or are waiting to buy the stock must be anxious to see the Company's 2009 interim results that are due in late September. I would note that for a toy manufacturer, revenue in second half of the year is typically 30-40% higher than that in first half, because of Christmas orders. And due to the presence of fixed costs, net income is normally more than 30% higher in second half compared to first half. So one would likely underestimate the full year result by simply multiplying first half result by two.

I did a back-of-the-envelope estimation of Dream International's 2009 financials, and I'm hopeful that the Company can achieve HK$10-15 million net profit for first half with no interim dividend, and HK$45-55 million net profit for second half with full year dividend of HK$25-30 million or 4-4.5 cents per share. And I would say that while I have a reasonable chance to be off for first half, I feel very confident about full year. If that happens, after full year result announcement and dividend resumption, share price should go above $0.60 (more than double current share price).

And for those who bought already, I would preach that you be patient and hold for at least 8 months. I know it's difficult to do, but whenever you have an urge to sell, just think about how much upside you will miss by selling early.

- Blogmaster

英皇國際報告

有一份新的研究報告關於英皇國際(163.HK)。如果想要，請email
2005mhk18@gmail.com
索取。

德林國際(1126)

近日我和德林國際(1126)的一位高層管理人員交流。儘管他沒有明確說明，我得到的印象是公司預計在2009年可以取得良好的業績，以及公司可能選擇不支付中期股息（即2009年上半年），但分發全年股息的可能性很高。公司將在本月底公佈其2009年上半年業績。

此外，我又花了兩個星期研究這個公司，我堅信，股價將在兩年內超過$1。