According to the report, Hevea has fully repaid all USD loans. Finally. Next, they will also allocate 20mil for capex expansion. With the debt off the shoulder, Hevea's real growth is starting soon.
Based on their 2015 Annual Report, their cash balance alone is almost sufficient to cover ALL of their liabilities. By end of 1Q2016, their cash pile should exceed their liabilities. Mgmt should really consider committing to a dividend policy. They certainly have the cash. RM20mil capex is nothing, their depreciation is almost RM30mil p.a.
@Jupiter - If you dunno already, MD is very prudent on capex expansion, so as to not repeat the steps in 2008. 20mil capex expansion does not sound much, but it will improve roughly around 15% of revenue. It is just the beginning only.
Growth > Dividend in growth phase. Once growth has stable or slowed down, it does not require so much of reinvestment (eg. Nestle, etc) then those cash can be used to distribute good dividend. This is how a business should be.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
Elitetrader
894 posts
Posted by Elitetrader > 2016-04-26 21:14 | Report Abuse
20D MA line is supporting.