May 2013

Biosensors declares dividend payout of USD$0.02

May 31, 2013November 19, 2017 sgwealthbuilder 27 Views 0 Comments

Biosensors announced a set of good results. Below is a short write-up on this SGX-listed company.

Quick Glance
1) Net Profit: US$115milliom
2) Cash and cash equivalent: US$614million
3) Net current asset: US$688million
4) Long term borrowing: US$277million
5) Net cash from operation: US$123million
6) Net asset value per share: US$0.72

Performance Summary for FY13
For the full year FY13, total revenue was US$336.2 million, a 15% increase from the fiscal year ended 31 March 2012 (FY12). Total product revenue was US$278.5 million, a 32% year-on-year increase while IVP revenue rose 35% year-on-year to US$264.9 million, primarily driven by growth in the Company’s DES sales and the consolidation of JWMS’ financial results starting from the third quarter of FY12 (Q3 FY12). CCP revenue was US$13.6 million, a 7% decrease from US$14.6 million in FY12. Licensing and royalties revenue was US$57.7 million, down US$23.1 million or 29% from US$80.8 million in FY12.

Gross margin on total product sales was 81% for FY13, a significant improvement from 73% in FY12 attributable to more favorable geographical and product mix as well as greater economies of scale.
Total operating expenses accounted for 57% of product revenue in FY13, compared to 61% for FY12. In detail, S&M expense was US$90.0 million, G&A expense was US$40.6 million, while R&D expense was US$27.5 million.

For FY13, despite a US$23.1 million or 29% year-on-year decrease in royalty revenue, Biosensor’s operating profit still achieved US$123.6 million, a 16% year-on-year increase from the same period last year.

Excluding exceptional items, which comprise a provision for restructuring expenses, fair value adjustment for warrants, realization of translation difference on liquidation of a subsidiary and impairment of goodwill, net profit for FY13 would have been US$111.6 million or basic EPS of 6.48 US cents and diluted EPS of 6.39

Gold

Gold as part of your investment portfolio

May 30, 2013May 8, 2017 sgwealthbuilder 43 Views 0 Comments

After posting several articles on BullionStar Singapore, a number of readers had emailed me to query my views on the gold market developments. Generally, I am still confident in the long term prospect of gold due to the emerging middle classes from India and China accelerating gold demand.

But more importantly, to be successful wealth builders, I believe investors should hold bullion in their investment portfolio. This is because gold prices often move in opposite direction to stocks and currency. So allocating gold in your portfolio can help to serve as a form of hedge against inflation and preserve your portfolio’s value.

Holistic view on gold investments
How do you become rich through investing in gold? The matter of fact is, investors should hold a long term view on gold and not expect quick returns from the precious metal. They should consider it as a form of diversification to lower risk for their investment portfolio.

Very often, I read articles from many bloggers in The Finance.sg sharing their own stock investments. Many of them pumped in hundred of thousands of dollars on shares, REITs and ETF. Their investment performances were impressive indeed but if the stock market plunged suddenly, large portions of their investment values would be wiped off overnight. How many of these investors can stomach such market swings? That I don’t know but all I know is that every portfolio must be balanced and focusing too much on stocks in your asset allocation is not healthy at all.

Believing in physical gold
Like many gold investors, I only believe in physical gold. In fact, according to London Bullion Market Association, on most trading days, 90% of transactions happened in physical gold and only 10% are in derivative market.

Actually this is what is happening in Singapore now.

Stocks

Super Group Q1 Net Profit Grew 24%

May 28, 2013November 1, 2017 sgwealthbuilder 29 Views 0 Comments

Super Group Ltd is a stock which I like very much and has been tracking for several years now. The company is a leading instant F&B with market dominance in SE Asia. It manufactures and distributes branded consumer products, primarily instant coffee, instant cereals and instant tea mixes products, for which it maintains top market positions in key markets throughout SE Asia.

1Q13 Results

Net profit increased 24% YoY to S$22.9m from S$18.5m

Sales up 9% YoY to S$132.4m from S$121.6m

Earnings per share up 25% to 3.97 cents

In line with the strategy of focusing on the Group’s core business, the Company entered into a

conditional sale and purchase agreement in May 2013 to dispose its 35.3% interest in Sun Resources Holdings Pte Ltd, an associated company engaging in property development. The total consideration amounted to $26m and will result in a gain of approximately S$16m upon completion. I viewed this as a good development because the group would then be able to focus on it core business and continue to enhance its brand.

The company has strong financial strength and coupled with its strong branding in SE Asia, I believe it can scale new heights within the next decade. Not vested at the moment.

Magically yours,

SG Wealth Builder

Gold

GST exemption for Gold and Silver

May 23, 2013May 10, 2017 sgwealthbuilder 51 Views 0 Comments

The following information is extracted from Inland Revenue Authority of Singapore’s e-Tax Guide.

With effect from 1 Oct 2012, the importation and supply of IPM in Singapore are exempt from GST. The supply of IPM which is exported continues to be zero-rated. However, only precious metals in the form of a bar, ingot, wafer and coin which meet certain criteria can qualify as IPM. To provide certainty, precious metal coins that qualify as IPM are prescribed in the GST Act. Precious metals which do not meet the criteria cannot qualify as IPM and the supply of non-IPM continues to be taxable. Examples of non-IPM are jewellery, scrap precious metals, numismatic coins and precious metals which are refined by refiners who are not on the “Good Delivery” list of the London Bullion Market Association or the London Platinum and Palladium Market.

Criteria for IPM bar, ingot and wafer
To qualify for GST exemption, the precious metal must meet all of the following criteria:
(a) It is gold of at least 99.5% purity, silver of at least 99.9% purity or platinum of at least 99% purity.
(b) It is capable of being traded on the international bullion market.
A precious metal bar, ingot or wafer refined by a refiner with the following accreditation/ endorsement is regarded as meeting this criterion:

(i) For gold and silver, a refiner in the current or former “Good Delivery” list of the London Bullion Market Association (LBMA)

(ii) For platinum, a refiner in the current or former “Good Delivery” list of the London Platinum & Palladium Market (LPPM)

(iii) A refiner who intends to be in the “Good Delivery” list of the LBMA (for gold and silver) or LPPM (for platinum) and is endorsed by the International Enterprise (IE) Singapore. Refiners with such endorsement will

Money management; personal finance

Buying insurance

May 22, 2013May 31, 2017 sgwealthbuilder 47 Views 2 Comments

Attached below is a comment from one of my readers in response to my post “Why I don’t believe in financial adviser”. I feel that there is a need to clarify my position and let my readers know more about my background.

I work in the aviation industry and has never worked in the financial sector before. The articles in this blog are a collection of my thoughts and personal experiences. Readers must not misconstrue the articles in this blog as financial advice.

My thinking is that you don’t have to be a qualified financial analyst in order to point out the inherent flaws in our financial industry. Any Tom, Dick and Harry can do so.

For many years, job titles like “financial advisers” or “financial consultants” have been too loosely used in Singapore by many insurance agents who are only interested in selling expensive whole-life insurance policies. Instead of educating the public on buying term and investing the rest, these FA often hard-sell unit trusts, investment-linked and whole-life insurances to customers. They often target customers’ desire to become rich and retire early.

Very often, the customers’ interest and needs are not met or aligned at all. To make matter worse, many FA are also not upfront with the commission or fees they are collecting from customers.

My vision is that Singaporeans can buy insurance policies directly from insurers without any middlemen at all. We all know that being a middleman is a lucrative trade because you are just providing a service and earn a commission through the process.

But having a middleman often created a trade-off and the end result is that customers ended up paying more. So do away with insurance agents and any third part independent financial advisers. Today, with online technology so advanced, everyone should

personal finance

Preparing for the worst through CPF nominations

May 16, 2013May 13, 2017 sgwealthbuilder 46 Views 0 Comments

Life is fragile and unpredictable. Many Singaporeans are so focused in making more money but they often fail to realize the importance of planning for the worst. If you think that preparing for the worst is all about buying expensive life insurance policies from your financial advisers, then you are wrong.

My dad passed away earlier this year. It was unexpected and my family was totally unprepared for his demise. Like many Singaporeans, my father did not plan his estate distribution and left without a Will. So we had some problems trying to close his bank saving accounts.

We were also initially unsure how to claim his CPF monies. Thankfully CPF Board wrote to us and informed that he had made a CPF nomination many years ago, so we were able to withdraw his CPF monies within weeks. The lesson learned out of this episode is to have a proper planning for financial matters while you are still around. It is important that you set clear directions on how you want the money which you worked hard for in your life to be distributed according to your wishes after you passed on.

Intestate Succession Act
In the absence of a will, your assets will be distributed according to the Intestate Succession law. The rules are rather inflexible and sometimes, your estate might not be allocated according to your wish. That is, your money might not go to the people whom you feel need it most. For example, if your wife and children are financially independent, you might want to provide for your elderly parents instead.

Under the Act, in the absence of a will, your estate will be distributed according to the below:
1) Spouse only: 100%
2) Spouse and child: 50% Spouse and child
3) Spouse and parents: 50%

Stocks

Boustead’s 10 Consecutive Years of Dividend

May 15, 2013November 1, 2017 sgwealthbuilder 37 Views 1 Comment

Not many listed companies in Singapore can claim to have more than 100 years of history. Boustead belongs to this handful group of companies.

Boustead is a progressive global Engineering Services & Geo-Spatial Technology Group offering an extensive range of specialized engineering services and geo-spatial solutions. Its suite of engineering services is geared to fulfil the demands of specialized engineering fields such as energy-related engineering (for oil & gas / petrochemicals and solid waste energy recovery), water & wastewater engineering and industrial real estate solutions.

Under its geo-spatial technology arm, the Group provides consulting services and distribute ESRI geo-spatial technology to major markets across Australia, South East Asia and South Asia.

Dividend History
Although Boustead has no formal dividend policy, it has a tradition of paying dividends linked to long-term net profit growth. Boustead has achieved respectable growth in dividends over the past ten years, with a compounded annual growth rate of 21% over that period.

Their history of annual dividend payments includes:
1)Ten consecutive years of dividend payments;
2) Growth in the ordinary dividend to 5 cents per share in FY2012 after maintaining the ordinary dividend at 4 cents per share for four consecutive years; and
3) Paying a total of 33.75 cents in cash dividends over ten consecutive years, equivalent to almost 200% of the purchase price of the Boustead share at 17 cents at the beginning of FY2003.

Financial Strength
As a wealth builder, I like Boustead because it is financially strong with net current assets of $150million and has consistently paid out dividends to shareholders for the last ten years. The business is well diversified to withstand potential economic recession. It is well managed with sound corporate strategies. However, given the current high valuation climax in Singapore market, I would only purchase this

Gold; silver

BullionStar Singapore’s Gold & Silver Products

May 13, 2013December 24, 2015 sgwealthbuilder 56 Views 2 Comments

BullionStar offers brand new gold bars from well-renowned LBMA certified producers. The manufacturers BullionStar works with include Heraeus and PAMP Suisse.
Renowned for 160 + years, BullionStar’s partner mint Heraeus produces gold bars from 1 gram to 1 kilogramBullionStar is also proud to offer bullion products from PAMP Suisse, one of the world’s leading bullion brands well known for its attractively designed products.

Silver Bars are available in sizes from 31,1 gram (1 troy oz) to 31,1 kg (1000 troy oz). BullionStar offers different LBMA certified brands including Heraeus, PAMP Suisse, Royal Canadian Mint & Johnson Matthey bars.
For a larger investment in silver, BullionStar offers very attractive silver bars in the sizes of 1 kg, 100 oz and 1000 oz.

Even for the astute investor, it might be worthwhile to also consider gold coins rather than only gold bars. Some of the following advantages can be attributed to gold coins compared to gold bars.
– Coins are more suitable in a scenario where precious metals return as money or means of payment.
– Small units carry higher premiums when shortages appear.
– Coins can be sold or consumed individually.

BullionStar carries a wide assortment of different gold coins in different sizes.
Silver coins is the most popular investment in silver. A lot of people choose to buy e.g. a monster box of 500 silver coins rather than a few large bars thus making coins a good alternative also for larger investors. Silver Coins are also a popular gift and due to the cheap cost of silver compared to gold, it is possible to hold a substantial amount of silver for a low cost.

BullionStar offers all the popular brands of silver coins such as Silver Eagles and Silver Maples.

Gold; silver

The Silver Bull Market: Investing in the Other Gold

May 12, 2013December 24, 2015 sgwealthbuilder 36 Views 1 Comment

In The Silver Bull Market: Investing in the Other Gold, Shayne McGuire examines the vital investment considerations about silver alongside the significant drivers of the metal’s bull market. Although silver moves closely with gold in financial markets, it differs from its sister metal in that more than half of demand is derived from multiple industrial processes.

While its significant reliance on film photography has ended, today silver’s industrial demand is driven by technological progress (brazing alloys and solders, smart phones, tablets, plasma panels and new applications like silk-screened circuit paths and radio frequency ID tags); photovoltaics (solar panels); and new medical applications (silver is both biocidal and highly conductive).

Though Warren Buffett disdains gold for its lack of utility, he regards silver differently: in the late 1990s, he purchased 130 million ounces, one-fifth of global production at the time. After outperforming virtually all other investment classes for more than a decade, gold is being reincorporated into the financial system as an asset deserving a position, large or small, in mainstream diversified portfolios. Leaving aside the metal’s rediscovered diversification benefits (it tends to go in the opposite direction when stocks go down sharply), gold has risen as a viable investment alternative in today’s environment of unhinged global government spending and monetary expansion.

While silver has risen as well—even more than its sister metal over the last decade—it has remained gold’s shadow investment for important reasons. For one, its smaller market and higher volatility have kept most financial professionals away, as the metal is often regarded as a highly erratic investment best left to speculators. There is also the memory of the 1980s and ’90s bear market, precipitated, in part, by the illegal attempt by two wealthy families to corner the silver market, which led to the metal’s darkest day, March 27,

Retirement

CPF adjustments

May 9, 2013May 7, 2017 sgwealthbuilder 27 Views 0 Comments

Below is a government press release announcing the changes in the CPF Minimum Sum and Medisave Minimum Sum. The increase in the CPF MS represented a 6.5% increase and the Medisave MS represented a 5.1% increase from 2012. Note that both rates are much higher than the core inflation rates in Singapore 2012.

Whilst I understand that the adjustments are necessary to help Singaporeans meet their retirement and healthcare needs, I question the need to peg the adjustments at a rate higher than the inflation rate.

Why is there a need to set aside so much money in our CPF Retirement and Medisave accounts? Does it really help and benefit Singaporeans? If so, why set so many restrictions for medical claims from our Medisave accounts?

The money in our Medisave Account belongs to us, so why restrict us from using it for medical costs? Obviously I am concerned as I am in my early thirties and at the rate it is going, the Minimum Sums could be half a million by the time I retire. I really hate to think that after slogging for decades, I cannot even touch or smell my hard-earned CPF monies.

CPF Minimum Sum
CPF members who turn 55 between 1 July 2013 and 30 June 2014 will need to set aside a Minimum Sum (MS) of $148,000 in their Retirement Account (RA). The MS for 2012 was $139,000. The MS has been adjusted over the years to account for inflation, longer life expectancies and Singaporeans’ rising expectations of their quality of life post-retirement. The MS is targeted to reach $120,000 (2003$¹) in 2015.

Medisave Minimum Sum and Medisave Contribution Ceiling
The Medisave Minimum Sum (MMS) is the amount that a person turning 55 needs to set aside in his old age for his

Gold; portfolio management

Good time to buy physical gold?

May 8, 2013August 9, 2017 sgwealthbuilder 30 Views 0 Comments

SG Wealth Builder is pleased to conduct another interview with BullionStar Singapore on gold investments.

Recently, gold prices has dipped quite a lot. In your view, do you think its only a correction or the start of a bear trend for bullion?

Many relate the slump in prices due to the recovering US economy and news that the Feds are easing on their QE programs. Other factors include China, being a net importer of gold, not performing as well economically as expected and Cyprus selling its gold reserves to clear its debts.

However, as investors are dumping “paper” gold in the market, we are experiencing a completely opposite environment here in the physical precious metals market. People are rushing in to buy physical precious metals to take advantage of the low prices right now to the extent that the mints/refineries are not producing enough to meet demands.

We are looking at a 6-8 weeks lead time upon ordering and premiums are increasing because of the rise in demand. With such heavy buying in the physical market, it will only be a matter of time when the investors and traders become bullish again and start to push the price of gold up.

A good time to buy the yellow metal?
It’s always hard to pin point a good time to buy gold. Gold prices were USD 300-500 per troy ounce in the 80s. So does that mean to say we have missed the boat? One thing for sure is that gold has stood the test of time for over 6000 years, no fiat currency has ever manage to do that.

Gold has always retained, if not increased, its purchasing power. Having said that, given the recent drop in prices, yes this is definitely a good window to purchase precious metals.

There

Book review; investment

The Value Investors: Lessons from the World’s Top Fund Managers

May 6, 2013January 15, 2016 sgwealthbuilder 29 Views 1 Comment

When I was approached to do a book review on “The Value Investors: Lessons from the World’s Top Fund Managers” last year, I was quite hesitant because I don’t believe in fund managements. As a self-style investor, I prefer a more hands on approach to investing. Even if I lose my monies, at least I learnt some lessons out of my investment mistakes. However, when I chanced upon a review by another fellow blogger, I changed my mind.

Apparently this book is an investment-biography book which features interviews of twelve value-investing legends from around the world, learning how their personal background, culture, and life experiences have shaped their investment mindset and strategy. These men, who became strong advocates of the approach despite considerable age and cultural differences, include: Mark Mobius, Irving Kahn, William Browne, Teng Ngiek Lian, V-Nee Yeh, Shuhei Abe and many more.

The book’s focus is on the investment techniques and approach of value investing. The content is engaging and unravels how these investors, each of whom has a unique value perspective, have consistently beaten the stock market over the years. The book attempts to answer some pressing questions such as “Do these value-investing legends share a trait that allows this to happen?”, “Is there a winning temperament that turns the ordinary investor into an extraordinary one?” and much more.

‘The Value Investors’ is for individual investors who wish to diversify their portfolio across different asset classes or geographically or wish to understand how they can master the balance between art and science in investing.

For more information, visit: http://as.wiley.com/WileyCDA/WileyTitle/productCd-1118339290,descCd-buy.html

Stocks

Singapore Dividend Stocks: Making Passive Income

May 3, 2013November 1, 2017 sgwealthbuilder 32 Views 0 Comments

Below is an article from guest blogger, Richard who works as a stock analyst and has 3 years of experience in the stock market. He likes to write articles and hope to share his experiences with investors in Singapore If you would like additional SGX Dividend Stocks data, information or screening tools, please visit website http://sg.dividendinvestor.com, a leading source for in-depth research and analysis for stock investments.

One of the best ways to diversify a dividend growth portfolio is investing internationally. Singapore is an excellent country in which investors can look for the companies that have a stable earnings and long history of dividend growth. There are several reasons behind it such as: Singapore’s companies have benefits of easy access to the world’s second largest economy, China, as well as many other growing economies in Southeast Asia, region, such as Malaysia, Thailand and Indonesia.

DBS Group Holding Ltd (SGX: D05) –

DBS Group Holding Limited is an investment holding company in Singapore. The company operates through its main subsidiary DBS Bank Ltd. This bank is engages in the provision of retail, small and medium-sized enterprise, corporate and investment banking services. The company’s institutional banking provides to its institutional clients the financial services and products. The company’s subsidiary, DBS Bank Ltd had established a wholly owned subsidiary in December 2012.

The company has a market capitalization of 38.26 Billion, EPS is 1.56, P/E ratio is 10.07 and dividend yield is 3.57 percent at the annual dividend payout of $0.28.

Keppel Corporation Limited (SGX: BN4) –

Keppel Corporation Limited is an investment holding and management company that is based in Singapore. The company is engaged in the marine, property and infrastructure business. It operates in four segments: Offshore and marine, Infrastructure, Property and Investments. Keppel Corporation Limited was founded in