Silverlake Axis / Goh Peng Ooi

Re: Silverlake Axis / Goh Peng Ooi

Postby winston » Mon May 18, 2020 1:25 pm

vested

What’s New

3Q20 net profit below expectations on weaker margins

No material disruptions from COVID-19; secured RM65m new contracts in 3Q20

Cut FY20F/21F earnings by 18%/19% on lower gross margin assumptions

Maintain BUY with lower TP of S$0.38; current valuations attractive at -1SD level

Source: DBS

https://researchwise.dbsvresearch.com/R ... =feagikhea
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118537
Joined: Wed May 07, 2008 9:28 am

Re: Silverlake Axis / Goh Peng Ooi

Postby winston » Wed May 20, 2020 9:58 am

vested

Outlook Dims On Headwinds; Stay NEUTRAL
Neutral (Maintained)

Target Price (Return): SGD0.24 (-4%)
Price: SGD0.25
Market Cap: USD446m
Avg Daily Turnover (SGD/USD) 1.10m/0.73m
52-wk Price low/high (SGD) 0.22 – 0.56

Maintain NEUTRAL, new DCF-based TP of SGD0.24 from SGD0.26, 4% downside with c.3% FY20F (Jun) yield.

Silverlake Axis reported a weaker 3QFY20, below our estimate.

It also guided for a weaker 4Q20, due to the Movement Control Order (MCO) in Malaysia.

Large deals continue to be a challenge to close, with many delayed by MCO measures or economic uncertainties.

As a result, we cut FY20F and FY21F EPS by 6% and 10%, to reflect lesser licensing and project service revenue.

Source: RHB

https://research.rhbtradesmart.com/atta ... 82526b.PDF
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118537
Joined: Wed May 07, 2008 9:28 am

Re: Silverlake Axis / Goh Peng Ooi

Postby winston » Wed May 20, 2020 4:26 pm

Company Profile:

Silverlake Axis Limited is an investment holding company.

The Company is a provider of digital economy solutions and services to the banking, insurance, payment, retail and logistics industries.

The Company operates through six segments:
1. Software licensing;
2. Rendering of software project services;
3. Maintenance and enhancement services;
4. Sale of software and hardware products;
5. Credit and cards processing services, and
6. Insurance processing services.

The maintenance and enhancement services business focuses on providing round-the-clock software support services and software enhancement services to customers.

The Company has operations in South East Asia, North East Asia, South Asia, the Middle East, North America, Africa and Europe
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118537
Joined: Wed May 07, 2008 9:28 am

Re: Silverlake Axis / Goh Peng Ooi

Postby winston » Thu May 21, 2020 9:25 pm

vested

Analysts see silver lining despite difficult 2HFY20 for Silverlake Axis

by Ng Qi Siang

SINGAPORE (May 20): Despite forecasting a poor 2HFY20 on the back of a bearish Covid-19-hit economy, most analysts have maintained “hold” calls on Silverlake Axis on the back of attractive valuations for the software firm.

How the firm - which specialises in software for the finance industry -- performs going forward, will depend on the willingness of banks and financial institutions to keep up with their IT capital expenditure post-crisis.

“Silverlake Axis reported a weaker 3QFY20, below our estimate. It also guided for a weaker 4Q20, due to the Movement Control Order (MCO) in Malaysia. Large deals continue to be a challenge to close, with many delayed by MCO measures or economic uncertainties,” report RHB analysts Jarrick Seet and Lee Cai Ling.

Seet and Lee have cut their earnings per share estimate for FY20 and FY21 by 6% and 10% respectively on the back of reduced licensing and project service revenue. DBS’s Ling Lee Keng went further, cutting forecasted FY20-21 earnings by 18-19%.

On May 15, the company reported that its core net profit for 3Q20 dropped by 25.7% y-o-y to RM 25.6 million ($8.3 million).

Revenue in the same period was relatively flat at RM151.7 million (-2% y-o-y) following weaker-than-expected contribution from project-related revenue segments. This weakness stems from project contract maturity in Thailand and Malaysia, which has led to lower progressive revenue that could be recognised.

Nevertheless, new banking implementation contracts in Vietnam and Indonesia in 1H20 and a technology refresh contract in Malaysia in FY19 have offset this.

EBITDA margin and net margin stood at 35.2% and 16.9% respectively for 3QFY20, dragging down nine-month FY20 margins to 43.1% and 24.8% respectively.

Similar margin pressures were felt by other enterprise software industry players like SAP and Infosys, arising from falling demand from retail and hospitality arising from Covid-19 and challenges coping with rapid changes in the industry.

“3QFY20 margins were compressed due to unfavourable revenue mix resulting in lower gross profit margin, and higher effective tax rate due to loss of pioneer status by a Malaysian subsidiary,” says Ong Khang Chuen of CGS-CIMB.

Operating expenses also rose 16% due to the consolidation of the recently acquired XIT Group and a rise in finance costs. Gross profit margin fell to 54.8% in 3Q20 from 59.0% in 3Q19, driven especially by lower software licensing revenue.

Considering the difficult year ahead, Silverlake’s management has hinted that it would seek to conserve cash and decrease dividends going forward.

It also announced a switch from quarterly to semi-annual dividend payouts. Seet and Lee anticipate a 40-50% payout ratio for FY20, and a dividend yield of as low as 2.7% for FY20 - a 1.5% drop y-o-y from June 2019.

They have maintained a “neutral” recommendation on the stock in anticipation of weaker earnings ahead.

“The COVID-19 pandemic has greatly impacted the global economy, as well as financial markets. Global air travel has ground to a halt, and cities are under lockdowns. Due to these circumstances, we believe banks will likely pare down costs and raise provisions for defaulting loans.

As a result, they will also hold back on major IT spending, and slash IT capex budgets. We think Silverlake will likely face more resistance in securing new projects from the banks or financial institutions,” they comment.

Nevertheless, DBS’ Ling has maintained her “buy” call on Silverlake on the back of attractive valuations. The counter is now trading at a price-to-earning ratio (PE) of 13.5 times for FY20F and 11.8 times for FY21F, near its -1SD (standard deviation) level of its average 4-year forward PE, indicating a more optimistic anticipated dividend yield of 4.5% while acknowledging that Silverlake prefers conserving cash in a crisis.

Kenny Tan of KGI also highlighted Silverlake’s strong order book performance as portents of a stronger 2H20. “Management [reported] no material disruptions and order book cancellations as of date...Given management’s conservativeness over winning large contracts, we think there was a sizable push back of the order book, as management guided for RM 300-350million of contracts to come in after 4QFY20,” he adds.

Demand for Silverlake’s products may also be strengthened as the widespread disruption caused by Covid-19 accelerates three technology megatrends after the pandemic -- digital adoption, cloud migration and artificial intelligence. Tan says that firms will increasingly invest in business transformation going forward, with a survey by market intelligence firm IDC suggesting that this is particularly the case for cloud computing.

Though this trend will divert spending from maintenance IT, Ling expects Silverlake to ride the fintech trend following seven acquisitions over the past decade to broaden its suite of business enterprise solutions. The DBS analyst expects Fintech spending is expected to grow at a CAGR of 4.1% during the 2015-2020 period.

As of 3pm today, Silverlake is trading at $0.24 with a relatively low PE ratio of 8.79. Dividend yield stands at an attractive 7.08%.

Source: The Edge

https://www.theedgesingapore.com/capita ... paign=FREE
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118537
Joined: Wed May 07, 2008 9:28 am

Re: Silverlake Axis / Goh Peng Ooi

Postby winston » Thu Jul 09, 2020 9:21 am

not vested

Initiation Update

We initiate with an OUTPERFORM on Silverlake with a TP of S$0.30 based on 13x FY21F EPS.

Silverlake has strong, multi-year relationships with key Asian banks and other financial institutions, providing and servicing their core banking systems.

Despite COVID-19 leading to lower project revenue, recurring maintenance revenue has picked up the slack, leading to minimal sales fall-off.

Two main future growth opportunities are from the expansion of the insurance Software-as-a-Service (SaaS) business, as well as potential projects involving digital banking in Malaysia.

War chest of cash is helpful in the event Silverlake wishes to pursue acquisitions or build up additional internal capabilities, which it will need if it wishes to compete in the cloud space.

Source: KGI
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118537
Joined: Wed May 07, 2008 9:28 am

Re: Silverlake Axis / Goh Peng Ooi

Postby winston » Thu Aug 27, 2020 9:27 am

not vested

BRIEF-Silverlake Axis Says Secured Contracts With 16 Existing Customers

Aug 26 (Reuters) - Silverlake Axis Ltd :

* SECURED CONTRACTS TO DELIVER INNOVATIVE AND TRANSFORMATIVE DIGITAL INNOVATION ENHANCEMENT SOLUTIONS TO 16 EXISTING CUSTOMERS

* CONTRACTS HAVE AN AGGREGATE VALUE OF 41 MILLION RGT

* CONTRACTS EXPECTED TO CONTRIBUTE POSITIVELY TO RESULTS OF SAL IN CURRENT AND FOLLOWING FINANCIAL YEARS

Source: Reuters
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118537
Joined: Wed May 07, 2008 9:28 am

Re: Silverlake Axis / Goh Peng Ooi

Postby winston » Thu Aug 27, 2020 9:57 am

not vested

Looking forward to a better FY21F

FY20 core NP of RM143m (-32% yoy) was below expectations at 85% of our forecast.

FY20 dividend payout ratio lowered to 40% (FY19: 60%).

Despite cautious business environment, SILV was able to grow its orderbook with smaller enhancement projects. Deal pipeline also remains healthy.

Upgrade from Hold to Add, as we believe the worst is over, and see earnings recovery in FY21F.

Our TP is lifted to S$0.39, based on 16.3x CY21F P/E.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 676008AAE6
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118537
Joined: Wed May 07, 2008 9:28 am

Re: Silverlake Axis / Goh Peng Ooi

Postby winston » Fri Aug 28, 2020 10:13 am

not vested

What’s New

FY20 revenue stable despite COVID-19; net profit boosted by lower tax rate.

Without tax benefit, net profit would have plunged c.40%

Weak project related revenue offset by stronger recurring revenue from Maintenance and Insurtech

Healthy project pipeline, with c.RM300m close to signing. Expect a better FY21F

Reiterate BUY with slightly higher TP of S$0.40

Source: DBS

https://researchwise.dbsvresearch.com/R ... =fgjaakhea
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118537
Joined: Wed May 07, 2008 9:28 am

Re: Silverlake Axis / Goh Peng Ooi

Postby behappyalways » Sat Aug 29, 2020 4:09 pm

Silverlake Axis posts 12% drop in 4Q earnings to $19.4 mil on lower revenue
https://www.theedgesingapore.com/capita ... er-revenue
血要热 头脑要冷 骨头要硬
behappyalways
Millionaire Boss
 
Posts: 39929
Joined: Wed Oct 15, 2008 4:43 pm

Re: Silverlake Axis / Goh Peng Ooi

Postby winston » Sat Nov 14, 2020 2:06 pm

not vested

Silverlake Axis posts 8% lower EBITDA of RM66.9 mil; secures digital innovation enhancement contracts worth RM70 mil

by Felicia Tan

1QFY2021 group revenue and gross profit fell 10% and 13% y-o-y to RM148.2 million and RM91.6 million respectively.

Revenue from Software-as-a-Service insurance processing of RM8.8 million stood 9% lower y-o-y mainly due to lower claims processing activities.


Source: The Edge

https://www.theedgesingapore.com/capita ... innovation
It's all about "how much you made when you were right" & "how little you lost when you were wrong"
User avatar
winston
Billionaire Boss
 
Posts: 118537
Joined: Wed May 07, 2008 9:28 am

PreviousNext

Return to S to T

Who is online

Users browsing this forum: No registered users and 9 guests