Aside monetized 30% splash, next will be 20% sprint highway. KPS have continuous incur its share of loss in 20% sprint highway. Sprint highway is targeted to turnaround these year after granted scheduled toll hike these year.
But, gov have decided to take over highway now. Therefore, if successful take over by government will allow kps not only able to recoup its investment cost in sprint, but with possible compensation due to premature taking over concession .
KPS now already have core business to generate profit, growth EPS and sustain future earning.
1. Century Bond Bhd ----> packaging business 2. CPI (Penang) Sdn Bhd -----> engineering thermoplastics business 3. Smart Pipe Technology Sdn Bhd-----> replacement selangor pipe business 4. King Koil Manufacturing West LLC ----> Licensing fees 5. KPS-HCM Sdn Bhd 51% -----> road and highway construction and maintenance 6. Aqua-Flo 51% ------> water treatment chemical supplier
The cash from the divestment is expected to receive an upfront cash payment of RM570 m or about RM1.06 per share with the remaining RM195 million to be paid in installments over a period of 9 years. This would increase the cash and bank balances for KPS to RM736m from RM166m. The board of management will allocate these fund to 3 buckets below
1. Reduce borrowing, trim down gearing from 0.5x to comfortable level 0.3x 2. Special dividends reward shareholders 3. Acquire new business and expand current business
The proportion of each bucket allocation is subject to balance consideration of each bucket, but if you look at KPS historically, whenever kps have major divestment, there will be special dividend to aligned with optimizing shareholders returns.
KPS is diversifying everywhere and nowhere. I hope their top manangement reads this. It is now just a kedai runcit - a recipe for low valuations.
With the payment from SPLASH, it has a chance to focus, I hope in the new economy. Build on its packaging unit by building up a high tech internet business focusing on the Asean market and we shall see valuations shooting through the roof,
KPS is well-positioned to do this. But alas, its management....!
KPS says: I am coming down to dance with you baby, dancing with the moonlight melody, dancing with you cheek to cheek before I soar, high again with you at the 12th waterfall!
And if you wish me to baby, I could come down lower, To retrieve you at the turn of a ringgit, But I fear your heart would flutter and murmur, and hng33's front-running suffers a sharp retreat!
And it is no use trying to stem me, I shall have you where and when I desire you, And not even hng33's full frontal can fog reality, of you squirming helplessly underneath me!
JJchan If you want to Buy, now it is time. Big Fish has put up block from 1.34 / 1.38 ( not my share bcoz i don't need anymore ) Next week, you will not get this price---too near announcement---Contra players will be flooding in 07/03/2019 14:22
JJchan big fish quickly removed block from 1.35 and 1.37-----all just show( he keeps a Eagle Eye on this forum)----Anyway big fish is big fish 07/03/2019 17:03. <--- hahaha. U have been calling people to buy from 1.96 to..........where got so much money to avearge down? Or u r just joking with us? Everytime u give a vuy call, for sure with down
JJchan as i said before there is a Big Fish here (trying to collect lower and lower) But everytime he tries to collect back, he found that he is getting less back for what he throws out. Bcoz he has to share some with me.( easy job for me just smoke cigar and watch ) 06/03/2019 11:22 <--- another bulzhit. Hahaha
KPS historically, whenever kps have major divestment, there will be special dividend to aligned with optimizing shareholders returns. The potential special dividend 50sen/share is highly expected.
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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....
hng33
20,165 posts
Posted by hng33 > 2019-03-04 17:31 | Report Abuse
Aside monetized 30% splash, next will be 20% sprint highway. KPS have continuous incur its share of loss in 20% sprint highway. Sprint highway is targeted to turnaround these year after granted scheduled toll hike these year.
But, gov have decided to take over highway now. Therefore, if successful take over by government will allow kps not only able to recoup its investment cost in sprint, but with possible compensation due to premature taking over concession .