Mid-July 2007 Portfolio Review

The first two weeks of July proved to be pretty fruitful, with some news from the companies I own. In the meantime, the Singapore Stock Market hit new highs once again, with the STI closing this Friday (July 13, 2007) at a record high (yet again, yawn !) of 3,654.61. The strange thing of course, is that the record close was “powered” by none other than a strong DJIA finish. There was no particular impetus for the index to close so high, as the second quarter results release period has only just officially begun (with SPH being the first and only index stock to release results).

Below is a summary and rundown of my investments and related news:-

1) Ezra - Buy Price $1.30 (bonus adjusted), Market Price $6.50, gain 400%. The most significant announcement was that of Ezra’s intention to divest part of EOC in order to realize the cash from their investment in EOC. This would be done by doing a vendor share sale on the Oslo Bourse when EOC got officially listed on the Main Board. The proceeds would be used to finance Ezra’s expansion and Management has also hinted at a dividend payout. Other news included the announcement of US$127 million worth of charter contracts for 10 of their vessels; 8 of which are from their current fleet (5 AHTS and 3 AHT) and 2 of which will be delivered soon. Ezra have also appointed their first finance director, Mr. Tay Chin Kwang, to helm the operations. He has experience in dealing with IPOs, M&A as well as corporate finance issues.

2) Boustead - Buy Price $1.295 (average), Market Price $2.34, gain 80.7%. Boustead has announced that their AGM will be held on July 30, 2007 at Boustead House. This is to approve the final dividend of 4.5 cents per share (gross) and also to pass ordinary resolutions to re-elect the directors. The Annual Report has yet to arrive and I will post my thoughts on the Annual Report as soon as I obtain it.

3) Swiber - Buy Price $1.01, Market Price $3.34, gain 230.7%. Swiber has announced the successful completion of the placement of 55.35 million shares to institutional investors to raise money for fleet expansion and for working capital. In addition, they have also announced that they have set up a new office in India and appointed Mr. BK (see previous 2 posts on Swiber) to be vice-president of the Indian and Middle Eastern Operations. Their EGM will be held on July 31, 2007 at 2:30 p.m. at Raffles City Convention Centre (I will be attending unless held up by unforeseen circumstances) to approve the sale and leaseback transactions for 5 vessels. I have just received the circular today and am digesting it. I will do a posting on it once I get through the numbers. The EGM will also be a good time to engage the Management again on Swiber’s strategies and future plans.

4) Global Voice - Buy Price $0.1775 (average), Market Price $0.205, gain 15.5%. GV has announced just one new contract in the half month from June 30, 2007 till now. The contract is a 5-year one signed with AIXIT to provide private fibre network connections. August can be said to be the month of “reckoning” as GV will report its half-year results. If what I am beginning to suspect is correct, GV may not have that strong a competitive advantage after all; a lot depends on the numbers so I won’t want to speculate too much at this point time. Mediaring’s profit warning was a sober reminder of how fast the IT industry changes, and I am now more wary of being too optimistic about GV’s future.

5) Suntec REIT - Buy Price $1.11, Market Price $2.01, gain 81.1%. No news on Suntec REIT. They should be releasing results close to the end of July, as is traditionally the case for the last few quarters. I am expecting a dividend of no less than 2 cents/share.

6) Pacific Andes - Buy Price $0.665 (rights-adjusted), Market Price $0.91, gain 36.8%. The rights issue entitlement has been paid for and my number of shares will double once the results of the rights issue are out (and CDP has sent confirmation of the new shares being credited to my account). Other than this, there has been no significant news for either PAH or CFG, though a very bullish and detailed report has been written by CIMB on CFG, giving many details of the structure of the VOA and CFG’s competitive strengths.

Overall Portfolio

My overall portfolio has increased by about 127% from a new cost of about S$44K as at July 15, 2007. The market value of my portfolio is around S$102K. The main increases in the portfolio’s value can be attributed to Ezra and Swiber. The month of July will see the release of results from Swiber (1H 2007 results) and Suntec REIT (released around late July 2007 for 3Q FY 2008), as well as the AGMs for Boustead and Pacific Andes and the EGM for Swiber. All in all, it’s going to be a very busy month !

My next portfolio review will be on Tuesday, July 31st, 2007 after market close and after I have attended the Swiber EGM.