Kuok Khoon Hong, chairman and CEO of Wilmar International, has seen an increase in his stake in the company. On Aug 16, about 3.46 million shares were purchased on the open market at around $3.6 each on behalf of Kuok by three investment companies in which he has deemed interests. On Aug 15, a million shares were bought at $3.64 each and on Aug 14, just over four million shares were bought at around $3.70 each.
Following these purchases, Kuok has a total interest of about 834.9 million shares, equivalent to 13.38% of the company.
The last time Kuok saw an increase in his stake was on May 31 when the same three investment companies acquired 3 million shares on the open market at an average price of $3.907 each.
Kuok’s latest stake increase comes after Wilmar reported weaker earnings in 1HFY2023 ended June 30, leading to a decline in its share price recently. On Aug 1, Wilmar reported earnings of US$550.9 million ($747.5 million) in 1HFY2023 ended June, down 52.7% y-o-y from US$1.16 billion recorded in 1HFY2022. Revenue in the same period was down 10% y-o-y to US$32.5 billion.
The company attributes the weaker numbers to lower selling prices despite moving a higher volume of goods. Despite lower earnings, Wilmar plans to maintain its interim dividend at 6 cents per share.
In his earnings commentary, Kuok says that the company has made “good progress” on various new businesses like condiments which he expects should become significant contributors in the future. “Barring unforeseen circumstances, we believe 2H2023 will be better than 1H2022,” says Kuok.
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Wilmar International and Yangzijiang Financial Holding
See also: Chairman and CEO Kuok raises stake in Wilmar International following softer 1Q
Share buybacks help lift EPS
Yangzijiang Financial Holding (YFH) has resumed its share buybacks. This follows the announcement of higher 1HFY2023 ended June earnings compared to 1HFY2022, thanks to a higher fair valuation of its investments.
On both Aug 14 and Aug 16, YFH acquired 3 million shares at 36 cents each. This brings the total number of shares bought back under the current mandate to nearly 30.1 million shares.
The buybacks were done days after YFH on Aug 12 reported earnings of $162.5 million for 1HFY2023, up 19.2% y-o-y. Total income in the same period was up 14.2% y-o-y to $198.4 million, boosted by a net gain of $34.5 million in fair value of financial assets versus a fair value loss of $19 million in 1HFY2022.
In addition to the buybacks, two of the company’s independent directors added to their respective stakes on Aug 14 as well. Chua Kim Leng bought 100,000 shares, bringing his total to 300,000 shares. Chew Sutat, who already held one million shares, bought 88,000 more. Both paid 36 cents for each share.
YFH was spun off Yangzijiang Shipbuilding in a listing of its own in April 2022. Just a month after the listing, YFH announced a $200 million share buyback programme.
As a result of the series of buybacks, its share base has been reduced by 6.2% as at June 30. Coupled with higher earnings, this has the effect of increasing its 1HFY2023 earnings per share by 27.2% y-o-y to 4.39 cents. In contrast, EPS for whole of FY2022 was 4.22 cents.
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As at June 30, YFH’s net asset value per share was $1.052 versus $1.0495 as at Dec 31, 2022. Accordingly, YFH is trading at a 64.8% discount off its book value as at its Aug 15 close of 37 cents.
At the time of its listing, the bulk of YFH’s assets were in the form of short-term debt investments in China. By listing in Singapore and operating here as well, it wants to build an investment and wealth management platform outside China.
YFH’s executive chairman Ren Yuanlin says the “robust” 1HFY2023 performance can be attributed to the “meaningful headway” the firm has made in reducing its non-performing loans as well its diversification strategy. “
Our Singapore investments have started to contribute positively to the group’s bottom line in this financial period and we expect contributions from this segment to continue growing in the foreseeable future,” he adds.
