Hyflux

[winston]

Not vested

Some fixing needed
UNDERPERFORM - Downgrade
Share Price S$1.44 - Tgt. S$1.23

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Even if results weren’t entirely stellar due to the challenging dynamics, they did reflect management’s hard work.

Our main grouse is the sudden revised capex for Tuaspring.

We also think the market needs to see the crystallisation of contracts and divestments.

1Q12 core profit forms 11% of our FY12 estimate. Though it is short of consensus’s S$20.7m, it sits within our 10-15% range for 1Q.

Our estimates and SOP target price are intact.

Downgrade from Trading Sell to Underperform.


Source: CIMB

[winston]

not vested

Brokers cut Hyflux target, estimates OCBC Investment Research and Maybank Kim Eng Research lowered their price targets on Hyflux Ltd, after the water treatment company reported weaker-than-expected results.

OCBC cut its price target to S$1.35 from S$1.55 and maintained its hold rating, while Kim Eng reduced its target to S$1.15 from S$1.21 and maintained its sell rating.

Hyflux shares were up 0.4 percent at S$1.44, having risen around 20 percent so far this year.

OCBC cut its earnings forecast for Hyflux's 2012 fiscal year by 14 percent and by 11 percent for 2013 on lower margin assumptions.

Due to the geographical switch in Hyflux's order book profile to Asia from Middle East and North Africa, its gross margin fell to 38 percent in its first quarter from 51 percent a year ago, OCBC said.

Kim Eng downgraded its 2012-2014 earnings estimate by 10-15 percent on reduced margin assumptions.


Source: Reuters

[winston]

not vested

1Q12 net profit rose 4% yoy to S$7.68m, driven largely by contributions from its Asian operations.

Revenue soared 60% yoy to S$138.9m (1Q11: S$86.8m).

With higher engineering, procurement and construction activities in Asia, higher raw materials and consumables costs were incurred, rising 96% yoy to S$85.2m.

Source: The Business Times

[winston]

not vested

Hyflux has apparently turned to the Public Utilities Board to get its okay for an almost one-fifth increase in upfront costs for Singapore's second and largest desalination facility that it is building in Tuas.

According to a recent report by a specialist publication, the cost increase of 18% arising from Hyflux's choice of a higher-efficiency
power plant will push the total development cost of its Tuaspring facility from $890m to $1.05 bn.

When operational in 2014, Hyflux's Tuaspring will produce an additional 70m gallons of water daily, to be supplied to the PUB under a 25-year water purchase agreement.


Source: DBS

[winston]

not vested

Singapore water treatment firm Hyflux said on Thursday, its second-quarter net profit rose 21 percent to S$17.5 million from a year earlier, on contribution from projects in Asia outside of China.

But gross margin fell to 35 percent from 50 percent.


Source: Reuters

[winston]

not vested

Hyflux’s 2Q12 results trailed expectations because of weak margins for Singapore and higher costs in Magtaa.

Ongoing operations are on track;

Hyflux still bids actively in the MENA region.

Our analyst has cut FY12/13F earnings by 30%/27% to account for lower sales and weaker margins.

Downgrade to Hold on limited upside to reduced TP of S$1.45 (Prev S$ 1.66).

Source: DBS

[winston]

DBS downgrades Hyflux to hold

DBS Vickers downgraded water treatment firm Hyflux Ltd to hold from buy and cut its target price to S$1.45 from S$1.66, citing less-than-expected second quarter earnings due to weak margins for Singapore.

Shares of Hyflux were up 1.1 percent at S$1.425, and have gained 18.3 percent so far this year, compared to the FT ST Mid Cap Index's <.FTFSTM> 18.9 percent rise.

Hyflux said its second quarter net profit rose 21 percent from a year earlier to S$17.5 million, but DBS noted that gross margin shrank to 35 percent from 50 percent, due to higher staff and financing costs.

DBS noted that Hyflux's management was optimistic about opportunities in the Middle East, especially in Algeria, Saudi Arabia, Oman, Qatar and Kuwait.

The Arab Spring caused a drought in water contracts over the last 2-3 years, resulting in pent-up demand, DBS said, adding it believes Hyflus was bidding for two major projects in Saudi Arabia and Oman.

However, the brokerage noted that margins for contracts in the Middle East may fall due to competition.

Source: Reuters

[winston]

not vested

Hyflux Q3 profit up 15% By Carine Lee

Hyflux Ltd on Thursday said its net profit for the fiscal third quarter ended Sept 30 rose 15 per cent year on year to S$14.52 million.

Its turnover rose 77 per cent to S$155.05 million from S$87.72 million a year ago.

Its nine-month profit increased 17 per cent to S$39.71 million from S$33.87 million, on revenue of S$484.39 million.

The 70-per-cent increase in turnover from S$285.61 million a year ago came primarily from higher activities, particularly from projects in Asia, excluding China.


Source: Business Times

[winston]

not vested

Hyflux: 3Q12 margins improve

Hyflux Ltd saw 3Q12 revenue rising 77% YoY to S$155.0m, while net profit also increased 15.1% YoY to S$14.5m.

Gross margin also recovered to 41.2% in 3Q12 from 34.5% in 2Q12 and also close to the 43.4% seen in 3Q11.

For 9M12, revenue jumped 70% to S$484.4m, meeting 82% of our full-year forecast, while net profit rose 17% to S$39.7m, or 62% of FY12 forecast.

Hyflux notes that the current environment remains challenging, but management believes that the fundamental demand for water remains strong, especially in countries like China, India and MENA.

We are also keeping our FY12 and FY13 estimates unchanged and are raising our fair value from S$1.35 to S$1.44 as we roll forward our 18x peg to blended FY12/Fy13F EPS.

Maintain HOLD; but fresh catalyst could come in the form of a substantial contract win.

Source: OCBC

[winston]

not vested

Hyflux: Reports 17% PATMI Growth Year To Date.

Hyflux Ltd and its subsidiaries recorded 17% growth in profit after tax and minority interests to S$39.7 million for the nine months ended 30 September 2012 on the back of 70% rise in revenue to S$484.4 million.

For the third quarter of FY2012, the Group saw PATMI increase by 15% to S$14.5 million.

The revenue for the three-month period was S$155.0 million, an improvement of 77% over the comparable period in FY2011.

The Group's profit before tax rose 27% to S$16.8 million. Asia ex-China provided 80% or S$123.9 million to total revenue, while China also chalked up higher sales of S$26.4 million.


http://hyflux.listedcompany.com/news.html/id/323033