Lew Syn Pau, the non-independent and non-executive chairman of Broadway Industrial Group, has raised his stake in the company in recent days.
Lew, a former member of parliament, started buying on Nov 24, acquiring 236,1000 shares on the open market at 8.04 cents each. On Nov 27, he bought another 195,700 shares, paying 8.09 cents each. On Nov 28, Lew acquired 111,3000 shares at 8.2 cents each.
The most recent was on Nov 29 when he acquired 456,900 shares at 8.9 cents each. This brings his total stake in the company to nearly 45.98 million shares or a 10.11% stake.
On Oct 31, Broadway announced that the result of an ongoing arbitration in China will be announced on Nov 30, having been postponed several times earlier. The dispute, first disclosed back in July 2021, was from the proposed sale of Broadway’s hard disk drive business.
Meantime, Broadway has started making inroads in its relatively new precision engineering business segment.
CEO Tan Choon Hoong, in the earnings commentary, says the company is “very encouraged” to see revenue from the new business. “We believe this is a very positive sign and we are looking forward to commencing full operations as soon as we receive our customers’ qualifications.”
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On Aug 10, Broadway announced a loss of $1.2 million for its 1HFY2023 ended June from earnings of $7.5 million a year earlier. Revenue was down 44.6% y-o-y to $126.4 million on softer hard disk drive volume due to lower IT spending amid uncertain wider economic conditions.
OUE stepping up buybacks
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OUE has stepped up its steady pace of share buybacks, acquiring shares from the open market practically every day throughout October and November. The transactions were more frequent compared to August and September.
The most recent buyback was on Nov 29 when it acquired 57,600 shares at $1.14 each. This brings the total number of shares bought back under the current mandate to more than 2.24 million units, equivalent to 0.265% of the share base.
On Nov 27 and 28, OUE LJ3 had acquired 136,200 shares at $1.138 each and 54,000 shares at $1.13 each respectively. While OUE is known for its property investments and hotels, the company has in recent years become more active in adding healthcare to its portfolio.
Last month, OUE Healthcare, its separately listed subsidiary, took control of Healthway Medical Corp (HMC), after owning more than 68% of the shares.
In its 1HFY2023 ended June earnings commentary on Aug 7, OUE says that taking control of HMC, which runs a chain of medical clinics and related facilities, is a milestone for OUE Healthcare as it builds “an integrated and seamless regional healthcare ecosystem centred on Singapore’s renowned medical excellence”, and that the deal can help opportunities for cost savings through streamlining of operations and economies of scale.
On Aug 7, OUE reported earnings of $40.2 million for its 1HFY2023, down 54.6% over the $88.7 million booked in 1HFY2022. OUE attributes the lower bottom line to a lower share of results of equity-accounted investments, higher financing costs and lower fair value on its investment properties. Revenue, however, was up by 53.3% y-o-y to $304.5 million, with all three main business segments reporting growth.
Revenue from real estate was up 46% y-o-y to $205 million; revenue from hospitality was up almost twofold y-o-y to $95.8 million and revenue from healthcare was up 79.1% y-o-y to $79.8 million as OUE’s recently fully refurbished Hilton Orchard Singapore captured the return of tourists.
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Similar to most property companies, OUE trades at a significant discount to its net asset value (NAV). As at June 30, its NAV per share was $4.33, down slightly from $4.35 as at Dec 31, 2022. In contrast, year to date, OUE’s share price has dropped around 10% to $1.1x as at Nov 29.
