Sin Heng Heavy Machinery, which focuses on cranes and other equipment used for construction, has been stepping up its share buybacks since September, a month after it reported much improved earnings amid an overall construction industry recovery.
The most recent buyback was on Oct 9 and 10 when it acquired 261,800 and 124,000 shares respectively, at 49 cents each. This brings the total number bought back under the current mandate to more than 1.92 million shares, equivalent to 1.696% of the company.
Before this, the company on Oct 3 and Oct 4 bought back 263,800 shares and 263,000 shares at 48 cents each respectively. On Oct 5 and 6, it again bought back 142,300 shares and 135,200 shares at 48.5 cents each respectively.
The company was founded in 1969 by executive director and CEO Tan Ah Lye and was listed in 2010. On Aug 11, Sin Heng reported earnings in 1HFY2023 ended June was up 89.1% y-o-y to $3.3 million from $1.75 million. Revenue in the same period increased by 31.1% y-o-y to $34.7 million due to higher rental income plus the sale of cranes.
Year to date, the company’s share price has gained nearly 10% to 49 cents as at Oct 10, near its 52-week-high. However, that is still at a significant discount off its book value per share of 91.45 cents as at June 30.
In its earnings commentary, Sin Heng says it is “cautiously optimistic” about its businesses due to the ongoing construction of Singapore’s MRT lines and other infrastructure projects. However, in Malaysia where it has a smaller presence, the business will remain challenging because of “continued weakness” in the pace of the building of infrastructure projects. The weaker currency is not helping either. Sin Heng had earlier exited its third market, Myanmar, following the coup.
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Sin Heng says it will continue to streamline and adapt its operations in line with the market conditions. With higher rates, inflation and a volatile forex market, its cash management will continue to be prudent. “Notwithstanding that, the group will remain open to explore other potential business opportunities that align with its long-term strategies,” the company says.
Diamonds on blockchains
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Sarine Technologies, which builds equipment for the diamond industry, continued with its share buybacks. The Israel-based company, dual-listed on both the Singapore and Tel Aviv exchanges, bought back 35,000 shares at 32 cents each on Oct 9, the first trading day after Hamas militants invaded Israel. Israel has declared war and struck back, raising geopolitical tensions in the Middle East yet again and sending Israel’s stocks down. Sarine’s shares reached a 52-week-low.
The company started its current share buyback on Aug 15, and the most recent was on Oct 11 with 25,000 shares bought at 32.3 cents, bringing the cumulative total to 389,000 shares, equivalent to 0.1% of the company’s share base.
On Oct 9, Sarine announced a collaboration with Tracr to provide a scalable, cost-effective system to help the industry track diamonds moving along the supply chains. Tracr is described as the world’s first fully distributed diamond blockchain platform, which can register rough diamonds at source.
On Aug 13, Sarine reported earnings of US$953,000 ($1.3 million) in 1HFY2023 ended June, down 85.4% y-o-y. Revenue in the same period was down 23.9% y-o-y to US$23.7 million. Sarine blames the poorer numbers on lower demand for its capital equipment and diamond scanning services, which, in turn, is because of dampened consumer spending amid higher inflation and economic uncertainty.
On Aug 28, Sarine announced it has engaged Global Close Alliances Group, an investment banking consultancy, to help “analyse and pursue means to maximise shareholder value.
