A Very Profitable Logistic Company From Bintulu

Author: Icon8888 | Publish date: Tue, 3 Mar 2015, 08:50 PM

Executive Summary

(a) Harbour Link has been consistently profitable over past few years. It reported EPS of 7.1 sen in latest quarter ended December 2014. Based on latest 12 months EPS of 22.9 sen, PER is approximately 7.5 times only. In my opinion, the stock is undervalued.

(b) Dividend yield is not very impressive at 1.4%.

(c) With lower fuel cost, will profitability improve further in coming quarters ? Or the company has to share the resulting savings with its customers ? We can only find out when the next quarter result is released.

(d) The company is a proxy to SCORE. For the uninitiated, SCORE stands for Sarawak Corridor of Renewable Energy. Basically it invovles making use of Sarawak's abundant water resources to generate electricity and attract energy intensive industries (such as aluminium smelting) to set up operation in the State.

Of course, Bintulu is also a major oil and gas production base. The recent decline in oil price might have a dampening effect on Bintulu's economic activities, which in turn might adversely affect the group's buiness operation. So please take this into consideration before you invest in this company

Harbour-Link Group Bhd (HALG) Snapshot

Open 1.70		Previous Close 1.65
Day High 1.76		Day Low 1.68
52 Week High 04/1/14 - 2.00		52 Week Low 01/7/15 - 1.35
Market Cap 313.0M		Average Volume 10 Days 24.0K
EPS TTM 0.23		Shares Outstanding 182.0M
EX-Date 11/26/14		P/E TM 7.5x
Dividend 0.03		Dividend Yield 1.45%

Harbour-Link Group Berhad provides total logistics, shipping and marine services, engineering & procurement, heavy lifting and haulage, property development, etc.

The group has healthy balance sheets. With net assets of RM250 mil, loans of RM97 mil and cash of RM85 mil, net gearing is 0.05 times only.

The group has been consistently profitable. The only time it reported a loss was in June 2013 quarter which it incurred RM25 mil impairment of goodwill.

Quarter Result:

F.Y.	Quarter	Revenue ('000)	Profit before Tax ('000)	Profit Attb. to SH ('000)	EPS (Cent)	NAPS
2015-06-30	2014-12-31	128,351	17,547	12,929	7.10	1.3800
2015-06-30	2014-09-30	136,611	17,088	11,235	6.17	1.3300
2014-06-30	2014-06-30	103,170	17,441	11,932	6.56	1.2600
2014-06-30	2014-03-31	115,060	10,138	5,485	3.01	1.2000
2014-06-30	2013-12-31	107,771	9,384	6,492	3.57	1.1700
2014-06-30	2013-09-30	135,361	12,598	8,752	4.81	1.1600
2013-06-30	2013-06-30	118,791	-8,072	-13,597	-7.47	-
2013-06-30	2013-03-31	102,624	6,828	5,466	3.00	1.5500
2013-06-30	2012-12-31	110,986	8,836	6,261	3.44	1.5200
2013-06-30	2012-09-30	100,796	9,784	7,242	3.98	1.5100
2012-06-30	2012-06-30	128,953	9,532	8,020	4.41	-
2012-06-30	2012-03-31	133,476	5,500	5,089	2.80	1.4200