Berjaya Food

Berjaya Food

Postby winston » Sun Jul 27, 2014 5:45 pm

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BFood dividend boost from control of BStarbucks by ng bei shan

Bfood plans to open at least 23 to 25 Starbucks outlets per year over the next five years.

BY buying out Starbucks Coffee International Inc’s 50% stake in Berjaya Coffee Co Sdn Bhd (BStarbucks) for RM279.5mil, Berjaya Food Bhd (BFood) will be able to have a better control of the cash cow, which may translate into higher dividend payout ahead.

BFood chief executive officer Datuk Francis Lee Kok Chuan tells StarBizWeek in an e-mail reply: “BFood will determine how the cashflow will be utilised instead of having to obtain permission for paying out dividends to BFood from the cash generated in BStarbucks.”

BStarbucks generated cash of close to RM60mil as at financial year ended April 30, 2014 (FY14) and BFood gets to fully decide how to spend the money upon completion of the acquisition, expected in September.

“We have a free hand to run the operations when it is a 50:50 ownership but we cannot simply pay ourselves dividends without getting approval from our partner, Starbucks International. They frown on us for paying out big dividends although cashflow in BStarbucks is very strong,” he adds.

He explains that BStarbucks managed to pay out RM2mil and RM6mil dividends in FY13 and FY14, respectively, and BFood only received half of the amount.

That will change once it owns 100% in BStarbucks.

He says all the dividends it received from BStarbucks were paid out to BFood shareholders as BFood has strong cashflow itself and does not need the monies.

The food and beverage (F&B) group paid out 49% of its earnings in FY13, 58% in FY12 and 42% in FY11.

AmResearch projects higher dividends of 5.3 sen and 6.3 sen in FY15 and FY16 respectively. Notably, dividend yields will be compressed due to the recent spike in its share price.

BFood is also in a better position for other merger and acquisition (M&A) activities due to a stronger cashflow from BStarbucks although it is not looking at other deals currently.

“Any M&As must make sense for BFood shareholders and should be earnings accretive. If a good deal comes along, we will not walk away from it,” Lee says.

Analysts opine that BFood got a sweet deal for buying the 50% stake in BStarbucks at a price-to-earnings (P/E) of 16 times of the latter amidst the booming coffee culture.

On the other hand, Starbucks Corp US is traded at an estimated consensus P/E of 30 times.

AmResearch forecast that BStarbucks will contribute 54% to BFood’s revenue, followed by Kenny Rogers Malaysia at 27%, going forward.

Operating costs unchanged

Operationally, growth plans and investment costs for BStarbucks remain intact.

“There is no change in royalties and franchise fee rates for the next 25 years, which is good for BFood.

“Investment in stores is no different from previously except that now the company is wholly owned by BFood,” Lee says.

New stores, which may come in the form of stand-alone shops and outlets in malls and petrol kiosks, cost RM800,000 to RM1.1mil depending on the size while the investment cost for drive-throughs are higher.

The company plans to open at least 23 to 25 outlets per year over the next five years. It has 173 outlets at present.

Source: The Star
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Re: Berjaya Food

Postby winston » Mon Sep 15, 2014 9:43 pm

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Berjaya Food Q1 earnings up 15% to RM6 mil

KUALA LUMPUR: Berjaya Food Bhd’s earnings in the first quarter ended July 31, 2014 climbed 15% to RM6mil from RM5.2mil, as revenue improved 8.5% to RM39.6mil from RM36.5mil.

Earnings per share rose to 2.18 sen from 1.99 sen in the corresponding period a year earlier.

Berjaya Food, which operates [b]Kenny Rogers Roasters (Malaysia, Indonesia and Cambodia) and Starbucks (Malaysia and Brunei) [/b]among other brands, said the higher revenue it enjoyed was due to additional restaurants operating in the quarter.

The company was bullish about its performance in the current financial year.

Its board of directors said with the completion of the proposed acquisition of the remaining 50% equity interest in Berjaya Starbucks Coffee Sdn Bhd, the operating profit and revenue of the group was expected to improve significantly for the remaining quarters of the financial year ending April 30, 2015.

Source: The Star
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Re: Berjaya Food

Postby winston » Thu Oct 09, 2014 8:28 am

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DJ Berjaya Food's Growth Outlook Outshines Its Peers: CIMB -- Market Talk

0651 GMT [Dow Jones] CIMB Research starts coverage of Berjaya Food (5196.KU) with an add rating and a target price 4.33 ringgit. That translates to a 2016 price-to-earnings ratio of 23.7, a 30% premium over its peers due to the firm's superior earnings growth.

The house defines an "add" rating as a stock that is expected to see returns exceeding 10% over the next 12 months. CIMB forecasts Berjaya Food, which operates Kenny Rogers Roasters, Starbucks and the Jollibean chain mainly in Malaysia, to see a three-year compound annual growth rate in earnings of 49%.

This compares to its peers' average of 13%. Growth will be mainly driven by Starbucks, while earnings from Kenny Rogers operations in Malaysia, Indonesia and new markets should gradually kick in, says CIMB Analyst Eing Kar Mei.

"Despite the strong brand names and earnings growth ahead, the stock is under-covered," she adds. The stock is currently down 0.6% at 3.12 ringgit.

Source: Dow Jones Newswires
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Re: Berjaya Food

Postby winston » Sat Oct 11, 2014 7:22 am

October 7, 2014

CIMB Research sees exciting times for Berjaya Food

KUALA LUMPUR: CIMB Equities Research has initiated coverage on Berjaya Food (BFood) with an Add call and RM4.33 target price – based on 23.7 times CY16 price-to-earnings (P/E), a 30% premium over the peer average, in view of its superior earnings growth.

It said on Tuesday the key re-rating catalysts include strong earnings growth from Starbucks, the recovery of Kenny Rogers Roasters (KRR) Malaysian and Indonesian performance, and the injection of Starbucks FMCG and other franchise businesses into the group.

Besides Old Town, BFood is the only company that offers exposure to the FMCG and casual F&B restaurant chain industry in Malaysia.

“BFood holds the franchise rights of KRR in Malaysia, Indonesia and Cambodia as well as the franchise rights of Starbucks in Malaysia and Brunei. It is also the owner of Jollibean worldwide.

“While its KRR business in Indonesia has not been performing well in the past two years due to the weaker consumer spending and lack of economies of scale, Indonesia offers huge long-term growth prospects given its large population base,” it said.

CIMB Research said in Cambodia, KRR is one of the first few franchise brands that forayed into the fast-growing untapped market.

While Malaysia and Singapore are relatively saturated compared to Indonesia and Cambodia, “we believe that there is still more room to grow given that its penetration rate in the suburban areas is still low”, said the research house.

BFood is also looking to replicate Jollibean’s simple business model to countries such as China, Indonesia and the Philippines, providing more growth potential.

CIMB Research pointed out Starbucks Malaysia is not only the largest coffee chain in Malaysia with 43% market share, it is also the top performing Starbucks franchise globally with the strongest same-store-sales growth (11%-24%) for five consecutive years.

Starbucks Malaysia had just completed its acquisition of the remaining 50% of Starbucks on Sept 18, 2014. As part of the agreement, it will open at least 25 stores/year in the next five years, pointing to strong growth ahead.

“Aggressive expansion aside, we are particularly excited about its plan to distribute Starbucks FMCG products in Malaysia that will give its earnings a strong boost.

“BFood’s parent company owns the franchise rights of Wendy’s, Papa John’s, KRR China and Krispy Kreme. These businesses could be injected into BFood once they turn profitable,” it said.

Source: The Star
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Re: Berjaya Food

Postby winston » Sun Jan 25, 2015 6:29 am

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Re: Berjaya Food

Postby winston » Thu Mar 19, 2015 5:07 am

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Berjaya Food share price advances despite weaker earnings

KUALA LUMPUR: Berjaya Food Bhd’s share price and warrants climbed in active trade on Wednesday as investors tried to look beyond its lacklustre nine months earnings which analysts described as “below expectations”.

At 3.48pm, Berjaya Food was up 19 sen to RM2.80 while its warrants added 18 sen to RM2.

CIMB Equities Research said Berjaya Food’s earnings for the nine months ended Jan 31, 2015 were below expectations at 61.4% of its and 58.5% of consensus full-year forecasts.

The research house had said in its report on March 12 the weaker earnings were mainly due to the slower-than-expected same sales store growth from Kenny Rogers Restaurants and Starbucks Malaysia.

It had said the revenue expanded in the nine months due to the full consolidation of Starbucks Malaysia while profit growth was slower due to poor sales and higher finance cost.

“We cut our FY15-17 earnings forecasts to factor in the slower performance from all businesses. This reduces our target price (still based on 23.7 times CY16 P/E). We downgrade the stock from Hold to Add,” it said.

CIMB Research pointed out that despite the weak results, Berjaya Food declared a second interim dividend per share of 1.25 sen, bringing year-to-date DPS to 3.75 sen, above its expectation.

The dividend will go ex on April 8.

Source: The Star
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Re: Berjaya Food

Postby winston » Sun Oct 25, 2015 10:40 am

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Bfood to open more outlets

by S. PUSPADEVI

Source: The Star

http://www.thestar.com.my/Business/Busi ... ?style=biz
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Re: Berjaya Food

Postby winston » Thu Dec 10, 2015 6:52 am

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Berjaya Food profit falls to RM6.2mil

BY P. ARUNA

KUALA LUMPUR: Berjaya Food Bhd (BFood) reported a 96.21% fall in its net profit for its second quarter ended Oct 31, attributed to a remeasurement gain of RM158.60mil in the same quarter a year ago.

The Berjaya Corp subsidiary posted a net profit of RM6.2mil for the quarter compared with RM163.6mil a year ago.

The group said this was due to a recognition of gain arising from the remeasurement of its earlier 50% equity interest in Berjaya Starbucks Coffee Co Sdn Bhd (BStarbucks) prior to it buying the other 50% in the coffee chain operator in September 2014 for US$88mil (RM374mil).

Excluding this remeasurement gain, it said, pre-tax profit for the previous corresponding quarter was about RM6.7mil compared with RM8.79mil this year, a 31% increase.

Revenue, meanwhile, jumped 79.8% to RM135.42mil from RM75.32mil during the same quarter a year ago.

In the announcement to Bursa Malaysia on Wednesday, BFood said the higher revenue and increased pre-tax profit was attributed to “the full effect of consolidating BStarbucks” despite foreign exchange (forex) losses of about RM1mil due to the weaker ringgit.

Year-to-date, net profit was 92.74% lower at RM12.31mil, while revenue was higher by 132.99% at RM267.83mil for the same reasons.

Quarter-on-quarter, the group reported an increased revenue of RM135.42mil from RM132.41mil, a 2.27% jump.

Profit before tax, meanwhile, fell slightly to RM8.79mil from RM8.95mil.

It said the higher revenue was mainly due to additional cafes operating in the current quarter, while the lower profit was due to higher forex losses.

BFood is engaged in the development and operations of the Kenny Rogers Roasters chain in Malaysia, Indonesia and Cambodia.

It also operates the Starbucks Coffee brand in Malaysia and Brunei, and Jollibean as well as other brands in Singapore.

“After October 2015, the ringgit has strengthened slightly against the US dollar and shows signs of stability.

“The profit margin is not expected to reduce further if the exchange rate is stabilised at the current level.

“The group expects Starbucks Malaysia to maintain its revenue growth momentum and the overall results of the group to be satisfactory for the remaining quarters of the financial year,” it said in the report.

The board of BFood has recommended a single-tier second interim dividend of 1.25 sen per share for the financial year ending April 30, 2016 to be paid on Jan 22 next year.

The total dividend declared for the financial period ended Oct 31 amounted to 2.25 sen per share.

BFood shares fell 1 sen to close at RM2.33 on Wednesday.

Source: The Star
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Re: Berjaya Food

Postby winston » Thu Jan 24, 2019 2:45 pm

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Dec 5, 2018

Breathing life into its KRR business

1HFY4/19 net profit of RM13.3m was above expectations at 60.7% of our and 53% of Bloomberg consensus full-year forecasts.

The 19% yoy growth in 1HFY19 net profit was due to lower losses from KRR operations in Indonesia and higher contribution from Malaysian operations.

Upgrade to Add, with higher TP of RM1.83 (22x CY20F P/E).

Source: CIMB

https://brokingrfs.cimb.com/01L9_dU0NTi ... YS_YQ2.pdf
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Re: Berjaya Food

Postby winston » Thu Jan 24, 2019 2:48 pm

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Sep 19, 2018

1QFY19 earnings in-line; U/G to BUY

Upgrade to BUY

1QFY4/19 results and first interim net DPS of 1.0sen were within expectations as earnings growth was mainly driven by Berjaya Starbucks’ (BStarbucks) organic growth and new outlets.

Our earnings estimates and MYR1.70 TP (pegged to unchanged 27x FY19 PER, at -0.5SD of mean) are intact.

However, we upgrade BFood to BUY (from HOLD) as the stock currently offers a 22% upside to our TP. We also believe that earnings downside risk could be lower post the disposal of PT Broga.

Source: Kim Eng

https://factsetpdf.maybank-ke.com/PDF/1 ... d8e476.pdf
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