Mid-June 2007 Portfolio Review

Dear readers, I am back from my honeymoon in Europe ! Was jetlagged the entire Sunday and slept from noon till about 8 p.m. (I feel like someone hit me in the head !). Now, my body clock is still that of Amsterdam and I think it will persist for a few days to come.....sianz.

Anyhow, imagine my surprise when I discovered that so much had happened to my companies while I was gone (and it's only been about 13 days !). I will now proceed with my review, more details for each company will be mentioned in future posts regarding the new events.

1) Ezra - Buy Price $1.30 (bonus adjusted), Market Price $5.65, gain 334%. On June 11, 2007, the company announced that it had been awarded a contract by ConocoPhillips for its deepwater heavy-lift accommodation pipelay vessel Lewek Champion. The vessel is expected to be delivered before end FY 2007 and the charter will commence in 1HFY 2008. An email to Ezra's Managment has confirmed that most charter contracts will be signed close to the date at which the vessel is slated for completion. I will discuss more of this and my email to the Management in a later post (there was also an interview done by MD Mr. Lionel Lee to Reuters on June 7, 2007).

2) Boustead - Buy Price $1.295 (average), Market Price $2.03, gain 56.8%. No new updates for Boustead. I am mainly waiting for the Annual Report and AGM to arrive.

3) Swiber - Buy Price $1.01, Market Price $2.33, gain 130.7%. Swiber has recently announced (on June 11) that it had signed an MOU with a Middle-Eastern company called Emirates Investment Group L.L.C. (EIG) to form a 50:50 joint venture in order to explore EPCIC activities within the Middle East. What's significant about this MOU is that the business contacts and market understanding which EIG has, and how it will act as a foothold for Swiber to explore lucrative opportunities in the Middle Eastern countries, including Pakistan. DBS has joined in the fray to upgrade this company with a TP of $2.76, while Westcomb has derived a TP of $3.00. For the life of me, I wonder how they come up with such TP when the company has not even signed a contract within Middle East ! Their projections for intrinsic value seem to come from the air, and I am not inclined to believe any prices set (I just read the reports for the facts). Intrinsic value remains relatively unchanged for now, except to factor in a slight premium for the company for its strategic tie-up. More to be said in a separate posting in future too.

4) Global Voice - Buy Price $0.1775 (average), Market Price $0.195, gain 9.9%. On June 6, 2007, GV concluded another agreement with a Dutch company called Illian Networks B.V. On June 13, 2007, they announced the appointment of a new Vice-President of Network Operations, Mr. Charles Cernicky. The announcement details can be found on the company's website. An email sent to the Management was met with no reply so far, so I question the so-called "efficiency" of their investor relations department.

5) Suntec REIT - Buy Price $1.11, Market Price $2.05, gain 84.7%. No significant updates for this REIT, which is well and good since there's so much updating to do for my other companies hehe.

6) Pacific Andes - Buy Price $0.81, Market Price $1.44, gain 77.8%. The China Fishery Group has purchased another 5 purse seine vessels on June 11, 2007, bringing their total number of vessels to 34 with a fish hold capacity of 9,395 square metres. CFG have been very aggressively acquiring vessels and assets since the issue of their senior notes due 2013. It is good to know that the Management is very pro-active in securing a foothold in Peru through these acquisitions, and it is hoped too that they are earnings-accretive acquisitions. At this point, it is rather difficult to assess the intrinsic value of PAH and Mr. Market has decided that he wishes to offer a better price for PAH recently, thus the spike up to $1.50. Patience rewards the rational investor, and I hope to see more good news flowing from CFG and PAH in time to come to benefit shareholders.

Overall Portfolio
My overall portfolio has increased by 106.7% from cost to date. I attribute this partly to bullish sentiments as the STI had a record close of 3,581.16 on June 15, 2007. The important thing is for my companies to keep being pro-active in order to grow earnings and the business, and even on my trip (during long journeys in the coach), I was thinking about my companies' business models, their competitive advantages and their customers and how it all gelled together. I will be talking about competitive advantages and a little about Porter's 5-forces model of analysis for companies soon, so stay tuned for that !

My next portfolio review will be on June 29th (last trading day for June 2007).

Wah.....how I have missed curry chicken, chai tow kway and char kway teow !! All I get for breakfast in Europe is.........bacon, eggs, ham, beans, bread.....rinse and repeat. Almost drove me nuts.....cup noodles all exhausted liao. I was wishing Pac Andes could donate some nice fish fingers and fishmeal to spice up my meals haha ! Kidding !

P.S. - I did not visit any European bourses though I did pass through the financial district of Belgium and Holland. What I did notice though, was the prevalence of banks such as ABN Amro, Citibank, CIC and Fortis. I also noticed the amazing amount of chocolate in my lap, which I was busy finishing up. Keke.