Stamford Land enjoyed a reasonably good year for FY 2015, end Q1 2015. The revenue increased 80% from S$62.2m to $112m which resulted to a net profit increase of 87.5% from $2.9m to $5.4m. The positive operational cash flow that doubled from $54.3m to $108.1m has once again enabled the management to give away a 3-cents dividends per share, comprising 2-cents final dividend and 1-cent speial dividend. The total dividend payout should be $25.9m which is the same as that of last year. This reinforced what I mentioned in my previous blog on stamford Land, it is like what Warren Buffet termed as equity bond.
Possible risks face by Stamford Land going forward:
a. A current debt of $192m to be paid within this calender year. But I think it can be resolved as it has a cash hoard of $144m, and with re-financing, the current debt should be worked out.
b. The weak Aussie dollars may pose some issues. However, this is offset by greater buying interest in Australian properties as the Aussie dollar weakens. It depends on the real dmand out there.
c. Government curbs may affect the sales of the Australian properties. Hopefully the effect is not significant.
(Brennen Pak has been a stock investor for more than 25 years. He is the Principal Trainer of BP Wealth Learning Centre LLP. He is the author of the book “Building Wealth Together Through Stocks.”) – The ebook version may be purchased via www.investingnote.com.