Cerebos Pacific

[winston]

Not vested. From CIMB:-

Cerebos Pacific (S$3.78) - Tonic for turbulent times

Cerebos is a leading food and health supplements manufacturer in the Asia-Pacific, best known for its flagship Brand's Essence of Chicken. Key products are liquid and solid health supplements, coffee, sauces and other food items. Management intends to increase the penetration rate for essence of chicken, develop its tablet health supplements business, and expand its share of the fast-growing coffee market in the Asia Pacific.

We forecast net profit growth of 8-11% p.a. for FY09-12 on the back of rising sales and stable margins. Generous dividends of S$0.25/share translate to 6.6% yields, backed by strong operating cash flows and a net cash position. Our sum-of-the-parts target price is S$4.86, representing upside of 29%. Resume coverage with Outperform.

[winston]

Not vested.

Having focused and succeeded in boosting its bottom line in the past three years, tonic specialist Cerebos Pacific is now training its sight on growing the top line at 20% a year in the next three years, said its president and chief executive officer Eiji Koike.

And its strategy is to revitalise the image of its Brand's Essence of Chicken by targeting the young. To this end, it is embarking on a major advertising and promotional campaign and has signed up MTV VJ Utt, also known as Greg Uttsada Panichkul, as its new ambassador. The firm is budgeting $2.5 million in gross media investment alone.

'After having been in the market for decades, still only less than 10% of the population take Brand's Essence of Chicken once a week. Only 1% take it daily. Something must be wrong. So we have to review our strategy,' Mr Koike. (BT)

[shaun]

Delete

[winston]

Cerebos strikes all the right notes By SIOW LI SEN

MAYBE they were there for the free lunch, but thinly traded Cerebos' results presentation on Wednesday was packed with analysts.

Altogether 17 analysts - 12 last year - were there, according to the management.

Having 17 analysts cover a stock is not so unusual for a large company, but Cerebos is hardly in the big league and, more to the point, most don't bother when it's low liquidity.

Cerebos' average daily volume is about 70,000 shares. Its low volume is partly due to parent Suntory holding some 83 per cent of the shares.

So why the interest, especially when it gets regularly criticised for its unexciting performance?

Perhaps after the last few years of giddy growth, followed by the turmoil of the past 10 months which has seen high-profile companies slash profits, a boring company such as Cerebos which manages to post higher sales and decent earnings is seen as a pretty good story.

The fact that it continued to pay out 25 cents dividend - its fifth year of doing so - giving a yield of about 11 per cent, cannot hurt either.

And the presentation didn't disappoint. In these troubled times, it was refreshing to hear management talk confidently of expansion, staying the course in investment, instead of cutting costs.

Chief executive and president Eiji Koike said Cerebos works on three-year plans; it is not managed on a quarterly basis.

Still, with the global economy mired, and CEO firings not uncommon, Mr Koike's jest 'This is my 12th year as CEO, yesterday the board had a meeting and did not ask me to resign' seemed to hit the right mood.

The serious message though was that despite this being the worst situation in a 100 years, Cerebos was well placed to continue expanding.

He said the confidence came from having navigated the Asian financial crisis, the 9/11 terrorist attack, Sars and avian flu which saw Cerebos steadily increased sales and profits.

Its latest net profit of $81 million on a turnover of $825 million, up from $68 million on a turnover of $551 million five years ago, is decent but hardly spectacular.

He pointed out that it takes a long time to build up a market.

For instance, Cerebos has been losing money in China since 2000. Last year, it had an operating loss of $10 million while sales rose 20 per cent to $19 million.

'Size of sales is too small. If sales become double, it would be much easier,' he said.

China is a long-term strategy for the company. He cited how Cerebos launched Brand's in Thailand in the 1970s but it only took off in the 1990s.

Today Thailand is Cerebos' biggest market, its operating profit contributing 45 per cent to total group turnover.
Last year, sales surged 28 per cent, with 30 per cent in the fourth quarter amid the country's intensifying political troubles.

Mr Koike reckons that once consumers take to a product, their loyalty does not waver easily. This is very critical, especially when you realise that Cerebos' selling price of Brand's, its main product, is the same, at $3 a bottle, across all markets.

Mr Koike has now set a target of $1 billion sales for 2010. It's the second time he's doing so. He also held out the possibility of making acquisitions, especially in Australia.

Back in 2000, he thought it would take the company five years to reach $1 billion. Whether he gets derailed again by the global crisis is anybody's guess.

Again he cites Cerebos' Thai operations as an inspiration. The current chief executive is Lackana Leelayouthayotin who joined in 1988. The other staff have also been there just as long and all understand how the company works. The message is consistent, simple but effective, he said.

Hopefully, the story next year will be just as pleasant.

[millionairemind]

Published February 14, 2009

Cerebos Q1 profit up 2% to $30m

By VEN SREENIVASAN

CEREBOS Pacific posted a marginal increase in first quarter net earnings despite foreign exchange translation losses taking a toll on its revenue and operating profit.

Net profit for the October-December 2008 period rose 2 per cent to $30.1 million, from $29.7 million thanks to continued strong growth in its Brand's franchise and its health supplements in all its markets.

This came despite a 2 per cent dip in topline sales to $223.7 million from $228.4 million.

The forex translation losses hit the topline revenue to the tune of $26.3 million, while the bottom line was hit by some $2.7 million.

The topline was significantly impacted by a more than 20 per cent year-on-year depreciation in the Australian dollar during the period.

In fact, the company's topline revenue took a $22.8 million translation loss on its Australasia business alone, which would otherwise have grown by 7 per cent during the quarter.

Revenue from Australasia totalled $74.5 million (after forex adjustments), versus $90.6 million a year earlier.

Still Australasia's operating profit would have been 13 per cent lower year-on-year excluding a $1 million translation loss due to high expenditures on promotions in the face of competitive pressures.

Thailand, Taiwan and Malaysia remained strong growth markets during the quarter, especially for the Brand's liquid products and health supplements.

Cerebos had cash and cash equivalents of some $136 million at the end of Q1.

[millionairemind]

November 25, 2009, 6.07 pm (Singapore time)

Cerebos' Q4 profit up 26%, plans final & bonus dividends

By CHEW XIANG

Cerebos Pacific on Wednesday said net profit for the fourth quarter to end September rose 26 per cent to S$25.06 million.

Turnover grew 4 per cent to S$209.59 million.

For the fiscal full year, net profit rose 2 per cent to S$82.8 million, on turnover of S$775.2 million.

Earnings per share was 26.29 Singapore cents, compared to 25.69 Singapore cents last year.

Cerebos, in the health supplement business in Asia and Australia, said turnover would have been 8 per cent higher this year if not for S$60 million in translation losses.

The board of directors is recommending a first and final dividend of 6 cents per share, unchanged from a year ago.

It is also recommending a bonus dividend of 19 cents per share, unchanged from last year, in recognition of the support from shareholders.

[millionairemind]

February 8, 2010, 6.20 pm (Singapore time)

Cerebos Q1 net profit up on improved consumer sentiment.

By SIOW LI SEN

CEREBOS has posted net profit of $36.8 million, up 22 per cent for the first quarter ended 31 Dec 2009 on improving consumer sentiment.

Turnover rose 24 per cent to $258.6 million, the company said Monday.

[winston]

CEREBOS PACIFIC Singapore-listed health supplement manufacturer Cerebos Pacific said on Friday it is aiming for a 10-20 percent revenue growth over the next three years as it steps up its presence in China, Indonesia and Vietnam.


Source: Reuters

[millionairemind]

May 10, 2010, 6.56 pm (Singapore time)

Cerebos reports a healthy 82% jump in Q1 net profit

By ANGELA TAN

Cerebos Pacific Limited announced on Monday that its net profit for the fiscal second quarter ended March 31, 2010 rose 82 per cent to S$22.66 million, up from S$12.4 million a year ago.

Turnover was at S$215.85 million, up 27 per cent from a year ago.

Excluding the exchange translation gain of S$12.1 million, turnover would have increased by 20 per cent, largely from higher sales in all three core businesses of Health Supplements, Coffee and Sauces.

Sales grew across all markets with Thailand, Australia, New Zealand and China leading the way with double digit growth.

[winston]

Not vested. From CIMB:-

• Above expectations; maintain Outperform.

2Q10 net profit of S$22.7m (+82% yoy) was above expectations, forming 25% of our FY10 estimate and consensus, with 1H10 net profit of S$59.5m (+40% yoy) representing 66% of our FY10 estimate. The outperformance came from stronger-than-forecast sales and lower taxes.

Our FY11-12 EPS estimates have been raised by 3-4% on the back of higher sales assumptions. Our FY10 estimate is unchanged as political instability in Thailand (which accounts for 97% of total operating profit) may affect 2H sales and profits. Following our upgrade, our sum-of-the-parts target price rises to S$5.34
from S$5.16.

The strong results indicate that the company is well-positioned for growth. We see stock catalysts from further sets of strong results.


• Topline strength.

Sales rose 27% yoy to S$215.9m on the back of S$12.1m of translation gains, and growth in the Australasia and Health Supplement businesses. Australasia sales increased S$20.4m to S$84.8m, underpinned by S$14.8m of translation gains, with the remainder attributed to stronger sales of fresh coffee and gravy in Australia.

Health Supplement sales expanded 24% yoy to S$127.4m on a 24% yoy rise in Brand’s liquid sales to S$120.4m.


• Operating performance.

Operating profit jumped 68% yoy to S$27.6m, led by a 45% yoy jump in Health Supplement operating profit to S$29.4m, with China, Hong Kong, Taiwan and Thailand recording double-digit percentage improvements.

Australasia booked an S$1.8m operating profit, reversing from a loss of S$0.8m a year ago. Higher sales in Australia were offset by higher advertising spending on sauces, but operating losses narrowed to S$0.2m from S$1.4m in 2Q09.

In New Zealand, there was a 237% yoy jump in operating profit on the back of higher sales and lower operating expenses. Gross margins dipped to 48% from 49%, but operating margins improved to 13% from 10% a year ago. Net margins expanded to 10.5% from 7.3% a year ago.

http://www.remisiers.org/research//Cerebos-110510[1].pdf