Singapore Press Holdings 02 (Nov 11 - Dec 23)

[winston]

not vested

Singapore Press Holdings (SPH SP)
Attractive Yield, New Defensive Assets; Upgrade To BUY

We upgrade SPH to BUY with a higher target price of S$2.25 following the recent drop in share price giving an attractive yield of 5.8% which is at 1.5SD above its 10-year mean.

The group’s additions of defensive assets continue to gather pace and increase its recurring income base.

The recent purchases of Japanese and Canadian assets tap on to the ageing trend in developed markets which have seen resilient demand even in economic downturns.

SPH’s defensive play could prove to be valuable amid the wider market sell-down.

Source: UOBKH

https://research.uobkayhian.com/content ... 2bc8fc23cc

[behappyalways]

SPH unit scraps purchase of six Canada senior housing assets
https://sbr.com.sg/residential-property ... ing-assets

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SPH slashes dividends by 73% amid Covid-19 concerns even as 2Q earnings rise 5.5% to $31.3 mil
https://www.theedgesingapore.com/capita ... 55-313-mil

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SPH hands over reins of local convenience store Buzz in bid to maximise shareholder value
https://www.theedgesingapore.com/news/c ... lder-value

[behappyalways]

SPH's Malaysian subsidiary halts operations
https://sbr.com.sg/media-marketing/news ... operations

[behappyalways]

SPH sells 5.29% stake in AXA Tower
https://sbr.com.sg/commercial-property/ ... xa-tower-1

[winston]

not vested

Singapore Press Holdings Limited (“SPH”) today announces that it is forging ahead with the integration of its Purpose-Built Student Accommodation (“PBSA”) assets as it prepares for the re-opening of UK universities in Academic Year (“AY”) 20/21.

At present, 69% of the target revenue for the upcoming AY20/21 has been achieved. The
robust bookings were driven by digital marketing initiatives both locally and internationally.

Bloomberg consensus expects SPH’s net profi t to decline 34% for financial year ended August 2020 to $135mln.

SPH’s market cap is S$2.5bln and currently trades at 19x forward PE and 0.8x PB.

Bloomberg consensus dividend yield stands at 1.9% (annualizing 1H dividend of 1.5 cents/share to expect 3 cents for the full year).

Net gearing (excluding non-controlling interests and perpetual securities) stands at 50.3%.

Based on consensus target price of $1.50/share, we have a HOLD recommendation on SPH.

Source: Lim & Tan

[winston]

not vested

UOB Kay Hian maintains its 'hold' call on SPH for undemanding valuation and uncertainty on impact of its property assets

by Felicia Tan

SINGAPORE (June 26): UOB Kay Hian analysts Lucas Teng and John Cheong have maintained their “hold” call on Singapore Press Holdings (SPH) with an unchanged target price of $1.52, which represents a 11.7% upside on the stock.

“While valuations appear undemanding, better clarity from the impact on its property assets could help re-rate the stock.

For the student accommodation assets, much will depend on the take-up rate in July as the deadline for universities’ acceptance was recently concluded,” they say.

SPH is the largest print media group in Singapore with a portfolio of retail mails via its 66%-owned company SPH REIT.

On June 4, the publishing company found itself removed from the Straits Times Index for its price weakness.

Teng and Cheong believe the company’s 3Q20 results will bear the brunt of the stay-home measures, on top of uncertainties from its media business.

SPH’s advertising revenue is also likely to dip further, which could lead to a cycle of reduction in funds for content, and subsequent advertiser support.

According to a recent report by advertising agency Group M, the decline in print media advertisement for 2020 is happening at an accelerated rate compared to previous years. This year, advertising revenue is likely to register a 25% dip y-o-y.

As such, the analysts have factored in a 20% decline in the company’s advertising revenue in FY20.

The gradual re-opening of the circuit breaker measures will likely gain traction from the suburban malls in SPH REIT’s portfolio. However, Paragon Mall, which contributes some 60% of revenue for the REIT, may see a slower recovery due to its luxury portfolio, and the prolonged disruption to tourism.

“Thus far, SPH REIT had already provided total rebates averaging 2.3 months. Weathering further storms will be dependent on its ability to mitigate headwinds, and given the REIT’s low gearing ratio of 29% as of 1HFY20, this will likely put it in a better position to do so,” say the analysts.

“We note that SPH’s share price performance year-to-date of -38% is much weaker vs SPH REIT’s -17%, despite SPH’s 66% ownership in SPH REIT,” they add.

SPH’s purpose-built student accommodation (PBSA) portfolio in the UK may also see an uptick, with the continuation of in-school activities.

According to Universities College Admissions Service (UCAS), only 31,380 applicants had deferred at least one of their university application choice as of early-June.

Preparations for in-person teaching are also underway for the majority of the universities. According to a study by Universities UK, 97% of the universities surveyed said that they will begin in-person teaching at the start of AY20/21.

“The group continues to review its non-core businesses and investments. We had previously noted the group owns a sizeable industrial property in Genting Lane, which in our view could provide an opportunity for consolidation of operations to further unlock value from its assets,” they conclude.

Source: The Edge

https://www.theedgesingapore.com/capita ... ncertainty

[winston]

not vested

'Hold' SPH for undemanding valuation and better outlook on property assets, says UOB Kay Hian

by Felicia Tan

THE EDGE SINGAPORE - UOB Kay Hian analysts Lucas Teng and John Cheong are maintaining their “hold” calls on Singapore Press Holdings (SPH) with a lower target price of $1.22 from $1.41 previously.

The rating comes after the announced that it would be retrenching 140 employees from its media sales and magazine operations.

The incurred retrenchment costs of some $8 million will be recognised in 4Q20.

While advertising revenue for SPH took a severe hit during the economic downturn, digital circulation remained the only bright spot with a 53% growth y-o-y.

On the property front, sales for Woodleigh Residences have been “encouraging” during the circuit breaker, with 43% of the total units sold as at August 16, with an average agreement for sale and purchase (ASP) of $1,892 psf.

The group’s purpose built student accommodation (PBSA) has also achieved 83% of its target revenue for the coming academic year as of August 14, with local students accounting largely for
the remaining bookings.

Potential catalysts include pick-ups in the footfall for SPH’s retail malls, bookings from international students for its PBSA, and a slower-than-expected decline in the media business.

“We input a higher conglomerate discount of 25% (previously 10%), given the severe adverse impact of the pandemic across all business segments for the group,” say Teng and Cheong.

“Current valuation appears undemanding at 0.5x book value although Covid-19 is expected to affect the valuation of SPH’s investment properties.

We opine that a better outlook for its property assets could help re-rate the stock. Entry price is $1.00,” they add.

Source: The Edge

https://www.theedgesingapore.com/capita ... b-kay-hian

[winston]

not vested

Singapore Press Holdings Ltd (SPH SP) - Ending a challenging year

SPH is a leading media organization in Asia, which is in the process of innovating digitally to transform its media business to meet changing readership and advertisers’ needs.

To diversify its income stream beyond media which is seeing structural headwinds, the group has made moves beyond its core business to diversify its portfolio, including its acquisition of student accommodation assets overseas, positioning in the aged care market in Singapore (Orange Valley Nursing Homes) with plans for expansion in Japan with Bridge C Capital and acquisition of M1 limited (with Keppel Corp) in April 2019 to leverage on synergies and explore new areas of growth.

Near term recovery should be gradual due to continued macro uncertainties following the pandemic which is expected to continue to weigh on the group’s key businesses . HOLD.

Source: OCBC