Monday, September 08, 2008

Swiber and Boustead - News Snippets

Just some short news snippets (my recent posts have been rather lengthy and will probably make readers fall asleep, so it's good to have short snippets now and then).

Swiber initiated its share buy-back programme last Friday and bought back 200,000 shares at an average price of S$1.3151, which will cost the company S$263,020 (excluding brokerage). Today, the company announced that it bought back another 186,000 shares at an average price of S$1.3662, incurring a total of S$254,113.20. The total shares bought back so far amount to 386,000 costing the company a total of S$517,133.20. Readers may recall that as recently as June 26, 2007, the company had raised S$120.4 million for business expansion through a placement of 55,350,000 new shares at S$2.1748. So I guess you can say that the company is buying back at a "discount" of nearly 38.3% (using an average re-purchase price of S$1.34 per share over 2 trading days). If we consider that the total amount they are allowed to re-purchase is only 42,435,000, I guess it's a pity that they cannot "re-purchase" all their share placement shares at $1.30+ and then hopefully re-issue new shares in future at a higher price ! Haha, just kidding but it's a sneaky thought.....

Boustead also announced today that Mr. FF Wong, CEO, had purchased an additional 142,000 shares of Boustead at a price of S$1.00 per share. This has effectively increased his already large stake of 31.7% to 31.73%. Perhaps the CEO is trying to signal something by purchasing shares in his own company, as he is acutely aware of the value of the business and the latent potential for future growth, but readers are free to conclude on their own if this means anything. Whatever the case, it is always more important to analyze the business first, before looking for any insider purchases.

8 comments:

aidah said...

hey there.came across ur blog while searching for the contents of my assignment.u seem to know a lot on the company's finance etc...may i know from where are ur sources,esp on ezra holdings and swiber??coz my assignment is on ezra holdings

thx

u may email me at roxy_aidah@hotmail.com

musicwhiz said...

Hi Aidah,

Thanks for visiting ! I have sent you an email.

Cheers,
Musicwhiz

Investor said...

Hi Musicwhiz,

Mind sharing me your source of information to me also...
My email acc: ahvyee@hotmail.com

Thanks..

musicwhiz said...

Hi investor,

Have sent you an email, but if it's something which can be tackled in the comments box, please do just post it here in future as I do not check my email often. Thanks.

Regards,
Musicwhiz

Anonymous said...

your self-labelled "sneaky" proposal that Swiber buys back all its recently issued shares and then reissue at a higher price is probably already being mulled by management, which at this point seems more interested in playing the market than really building a solid company?? these are difficult times where penny companies are facing an uphill struggle trying to stay afloat to remain solvent. caution - this is not time to speculate for a quick buck on capital appreciation on companies such as these being discussed here.

musicwhiz said...

Anonymous,

Your comment could possibly get you into hot soup, as you seem to be insinuating that Swiber's Management is "playing the market" without much proof.

If buying-back shares is considered playing the market, then please examine all the blue-chip companies in USA who have enhanced shareholder value by buying back their shares. Can you also claim they are "playing the market" ? One must be responsible when passing such remarks.

Musicwhiz

Nwc said...

Hi Musicwhiz, im interested to invest in this company Swiber. I find the company has done alot and obtain huge growth prospects. However im concern with their current balance sheet figures,like their huge trade recievables and huge trade payables. In your opinon do you think the company will be able to payoff their current debts in time?

musicwhiz said...

Hi nwc,

I have replied this in the other thread on my Sep 2008 portfolio.

Regards,
Musicwhiz