Daily news - 12 to 14 Nov

Genting Int'l posts lower Q3 loss of $116m
Genting International has reported revenue of $177.4 million for the third quarter of 2008, down one per cent from $178.86 million a year earlier. It registered a net loss of $116.83 million for the quarter, compared with a net loss of $393.38 million in Q3 last year. Genting, which is building Resorts World at Sentosa (RWS), said Q3 revenue was bolstered by gaming wins, but results were affected by higher bad debts and exchange losses. It registered $20.8 million of net bad debts attributed to gaming operations in the UK, which were written off in Q3. Genting said this was cushioned by fair-value gains of $17.1 million on derivative instruments. Giving an update on its financial position, it said RWS completed on April 24 this year its syndication for up to $4.19 billion syndicated senior secured credit facilities - comprising $4 billion loans and $192.5 million banker's guarantee. The credit facilities are expected to fund two-thirds of the estimated project cost of RWS, with the remaining cost to be met internally and from a rights issue in 2007. On Nov 3 this year, the company achieved financial close on the $4.19 billion limited recourse finance for the integrated resort development. On Nov 10, the company completed its first drawdown of this facility, amounting to $600 million. In October, Genting increased its equity investment in RWS by subscribing for 300 million new ordinary shares for a total of $300 million, bringing the number of ordinary shares it has subscribed for to 2 billion, as planned. Genting said that at Sept 30 this year it had awarded or committed more than $4.2 billion of the $6 billion project costs of RWS.

Banyan Tree posts $4.9m Q3 loss, hit by Thai turmoil
Banyan Tree Holdings posted a net loss of $4.88 million for the third quarter ended Sept 30, hit by the political turmoil in Bangkok which deterred travellers and forced the closure of Phuket Airport for a weekend in August. In comparison, the company earned a net profit of $49.1 million in Q3 2007, which was bolstered largely by a one-off exceptional gain of $44.5 million then arising from the recognition of negative goodwill. Revenue for Q308 was flat at $82.75 million. Earnings per share for Q308 was negative 0.64 cents, down from 6.45 cents in Q307. For the nine months ended Sept 30, net profit plummeted 78 per cent to $13.98 million while revenue grew 19 per cent to $321.72 million. During the quarter, hotel residences revenue surged from $3.6 million to $17.2 million, as a result of revenue recognition from villas and suites at Banyan Tree Phuket, Banyan Tree Lijiang, Dusit Laguna and Banyan Tree Bangkok. Revenue from hotel investment dropped 13 per cent to $37.4 million on the back of lower revenue from Thailand as the political crisis in Thailand affected visitor arrivals. At $8.7 million, property sales were also lower than Q307's $16.3 million while hotel management revenue decreased by $0.4 million to $4.3 million.

Wilmar Q3 net soars, says funding healthy
Wilmar International's funding situation remains healthy despite a bank having withdrawn its credit line, the palm-oil group said yesterday as it unveiled a more than doubling in third-quarter net profit. According to Wilmar's chief financial officer Francis Heng, HSH Nordbank pulled its funding following a strategic decision to exit from commodity finance. The move was not a reflection of Wilmar's credit standing, he said at the results briefing. 'We are very happy that our bankers continue to support us strongly. As of today, we only have one bank that has cancelled our lines,' Mr Heng pointed out. BT understands that HSH Nordbank's credit line withdrawal is unlikely to have significant impact on Wilmar. Its 2007 annual report lists 16 principal bankers which include DBS Bank and OCBC Bank. As at Sept 30, when HSH Nordbank's funding was still available, the palm oil giant had access to credit facilities totalling US$11.4 billion. Around US$3.9 billion was unutilised. 'The group has minimal refinancing risk as most of its borrowings are short- term trade financing facilities which are backed by inventories and receivables,' said Wilmar.

Allgreen Q3 net falls 10.9% to $31m as global credit crisis starts to bite
Allgreen Properties – Malaysian tycoon Robert Kuok's Singapore-listed property unit Allgreen Properties posted a 10.9 per cent year-on-year decline in third-quarter net earnings to $31.2 million. Revenue fell 8.2 per cent to $113.4 million over the same period. The bottom line was also eroded by an increase in interest expense, as well as higher distribution and selling expenses. Allgreen said that as at Sept 30, 2008, its gearing stood at 0.45, up from 0.30 as at Dec 31, 2007. Net borrowings increased from $743.6 million as at end-2007 to $1.14 billion as at Sept 30, 2008 - due mainly to overseas investments and purchase of development sites in Singapore. The group booked lower revenue from development properties in Q3 but revenue from investment properties continued to improve from the same period last year on the back of higher rental rates from offices, serviced apartments and retail space. Allgreen owns Great World City at Kim Seng Road, comprising offices, shop space and serviced residences; Tanglin Mall, Tanglin Place and a majority stake in the 546-room Traders Hotel near Orchard Road.

Parkway's Q3 profit plunges in absence of exceptional gains
Parkway Holdings – The absence of exceptional gains have led Parkway Holdings to post lower net earnings of $10.2 million for the third quarter ended Sept 30, 2008, down from $224.6 million for the year-ago period. The big profit difference stemmed from the booking of exceptional gains totalling $220.8 million in Q3 2007 from Parkway's disposal of its Singapore hospital properties to Parkway Life Reit, the sale of two units at Eng Lok Mansions and other investment properties. Excluding the exceptional items, operating net profit climbed 3 per cent to $23.2 million. Q3 revenue edged up 7 per cent to $239.4 million. Revenue from its Singapore hospitals were flat, while those from its international hospitals grew 10 per cent to $47.9 million. In the outpatient segment, revenue from the Singapore clinics went up 24 per cent to $39.6 million, while the takings from its international operations - mainly in China and Malaysia - expanded 11 per cent to $30.8 million.

Ascendas-Reit allays fears over TT International
Ascendas-Reit (A-Reit) & TT International – A-Reit has come out to reassure investors that its tenants are not in breach of rental obligations. Reit manager Ascendas Funds Management said yesterday that tenant TT International placed a security deposit equivalent to 11.4 months' rent, or $6.86 million. 'If the tenant should default on its rental or lease obligations, this security deposit could be used to offset any potential negative impact on A-Reit's financial results in the near term,' it said. The announcement was made after TT International said recently it was in default on certain fixed-rate notes and would seek a halt on repaying money owed to its principal bankers and all unsecured creditors. TT International Tradepark (TTIT), a subsidiary of TT International, rents a six-storey warehouse and adjacent 10-storey office building from A-Reit, near Jurong East MRT. With a net lettable area of 42,765 square metres, the property accounts for 2.3 per cent of A-Reit's total net lettable space. TTIT has a 10-year lease from March 2004 and accounted for 1.8 per cent of A-Reit's total gross monthly revenue at Sept 30. TTIT's current rent is $1.30 per sq ft per month. The real estate investment trust manager said: 'At this juncture, TTIT is not in arrears on its rental obligation.'

MIIF cuts dividend to pay off debts
Macquarie International Infrastructure Fund (MIIF) will cut its dividend and use any surplus cash to repay its debts completely by end-2009 in a bid to shore up its battered share price, its fund manager said yesterday. From now on, MIIF will exclude gains on investment disposals from its twice-yearly ordinary dividend, which will be paid only out of regular operating income from its businesses. Any extra cash will be used to repay unsecured debt, which is expected to reach $60 million next year, MIIF said. This will remove any refinancing risk associated with its corporate debt. MIIF's shares have plunged 61.4 per cent this year, dragged down by worries over its level of debt. They traded at 38 cents apiece yesterday. MIIF's manager said the fund's unsecured corporate borrowings stood at $27.5 million at end-September and are expected to reach $60 million next year as it draws further on loan facilities to fund investment and working capital needs. The facilities expire in 2011. 'While MIIF's corporate facilities have a remaining tenor of three years, we consider the early repayment of corporate borrowings a prudent course of action in the current market,' said Gavin Kerr, managing director of MIIF's manager. As a group, including portfolio companies, MIIF had borrowings of $123.2 million at end-September, including $89.1 million of long-term debt. The fund reported a net loss of $91.4 million for the three months to end-September, plunging deep into the red due to $80.7 million in losses on the fair value of its financial assets during the quarter. A year earlier, MIIF made a net profit of $64.8 million, boosted by fair-value gains of $77.1 million. Net income adjusted to show the earnings out of which future dividends will be paid grew to $51.2 million for the quarter, from $17.4 million a year earlier.

Yangzijiang more than doubles Q3 profit to 475m yuan
Yangzijiang Shipbuilding (Holdings) has more than doubled its net profit to 475.3 million yuan (S$103.9 million), from 224.7 million yuan previously, for the quarter ended Sept 30, 2008. Similarly, sales more than doubled to 2.02 billion yuan, and the company declared an interim dividend of one cent per share. On a nine-month basis, turnover went up from 2.3 billion yuan to 5.5 billion yuan while earnings rose from 554.1 million yuan to 1.18 billion yuan. Third-quarter gross profit rose from 235 million yuan to 466 million yuan and gross profit margin rose to 23 per cent from Q2's 17 per cent as Yangzijiang built more high-margin big vessels. Almost a third (695.6 million yuan) of Q3 sales came from the bigger 4,250 20-foot equivalent unit (TEU) containerships compared with none a year earlier. Cost of sales rose to 1.6 billion yuan from 648.7 million yuan previously, in line with the higher volume of shipbuilding activities. However, administrative expenses fell by a third from 62.4 million yuan to 41.9 million yuan, as the group contained its overheads.

Source: Kim Eng