Dr Ng Chin Siau is poised to be the single-largest shareholder of beleaguered restaurant operator No Signboard Holdings following the purchase of a 29% stake for the token sum of $1.
As part of the deal, Ng, better known as the co-founder and CEO of Q&M Dental Group, is extending an interest-free, unsecured loan of $2.6 million to No Signboard for working capital.
However, additional funding is needed beyond the coming 12 months and No Signboard is still looking for other investors.
With the sale of the shares, Lim Yong Sim, chairman and CEO of No Signboard, and Lim Lay Hoon, COO and executive director, will see their stake, held via an entity called GuGong, reduced to 25.91%.
No Signboard has been under financial stress for a couple of years, partly due to the pandemic. Attempts to diversify from its high-end core seafood restaurant business to fast food brands have not yielded good results.
In 4QFY2021 ended Dec 31, 2021, No Signboard reported losses narrowed 62.2% to $1.6 million from $4.2 million a year ago although revenue dropped by 37.5% to $1.47 million. For the whole of FY2021, losses narrowed by 35.4% to $6.35 million while revenue dropped by 42% to $7.9 million.
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The company has called for a trading suspension since Jan 24. It last traded at 3.1 cents.
Resumes buying since Dec 2020
Eric Low, deputy CEO of developer Oxley Holdings, has made a spate of open market buying over the past week. The most recent transaction was on March 7, when he acquired 50,000 shares for 17.5 cents. This brings his total interest in the company to some 1.19 billion shares or 28.12%.
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Before the acquisition, Low, the second-largest shareholder of the company, on Feb 28 and March 1, 2, 3 and 4, had acquired 100,000 shares for 17.9 cents each; 50,000 shares for 17.8 cents each; 6,000 shares for 17.8 cents each; 100,000 shares for 17.8 cents each and 100,000 shares for 17.6 cents each respectively.
According to filings on the Singapore Exchange, the last time Low had acquired shares in Oxley was back on Dec 9, 2020, when he purchased 100,000 shares for 22 cents. In 1HFY2022 ended December 2021, the company announced earnings of $23.4 million, down 18% from $28.6 million a year ago. Revenue fell 14% to $506.4 million.
Is the worst over?
GHY Culture & Media Holding has started buying back shares following its announcement that FY2021 earnings came in lower than expected.
On March 9, the company bought back 177,400 shares at 41.182 cents each, bringing the total number of shares bought back under the current mandate to nearly 2.17 million shares. It had been buying daily since that start of the month.
On March 7 and 8, it had acquired 165,300 shares for 42.544 cents each and 203,700 shares for 40.791 cents each respectively. On March 2, 3 and 4, it had acquired 160,000 shares for 39.844 cents each; 84,700 shares for 41.529 cents each and 60,000 shares for 43.167 cents each respectively.
While the company has bought back shares, there is no indication thus far that its controlling shareholder, executive chairman Guo Jingyu, is beefing up his stake.
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According to SGX filings, the last time Guo bought was on Sept 14, 2021. Back then, he had acquired 138,300 shares for $82,595.53 or 59.7 cents each. With the most recent purchase, Guo has a total interest of some 644.6 million shares, equivalent to 60.03%.
On March 1, GHY reported that earnings for FY2021 ended December 2021 plunged by 90% to $3.9 million from $38.1 million reported for FY2020. Revenue in the same period was down 34% to $83.3 million.
The company attributes the big drop to disruptions from the pandemic, hitting concert and drama productions alike.
In her March 4 note, DBS Group Research’s Ling Lee Keng writes that while the worst could be over for GHY, the outlook remains challenging.
As such, she has downgraded her call on this stock from “buy” to “hold” and cut her target price from 87 cents to 45 cents to reflect her revised earnings estimates for FY2022 that is down by 71%.
Ling notes that GHY has built a “healthy” production pipeline with more shows and productions in progress but “execution is still key”.
Photo: Albert Chua of The Edge Singapore
