So UKC hit a valuation of above net current assets a lot sooner than I expected. Not because the share price took of on a rocket, but because the company made large write-downs of receivables and prepayments.
The share has traded up since I took my position, but I feel a bit anxious about the write-downs so I sold. You know “Misfortunes never come singly” – there could be more problems with the books. The need to put together an independent audit committee indicates managerial problems.
Exited at ¥1922, so return of about +17 % in 5 weeks.
Today I exited Kingboard at 0.405 SGD. There is a tender offer for all shares in Kingboard.
During the time I’ve owned the share there has been a pending lawsuit from minority share holders against the company. The story has many twists and turns and you can read more at the blog Cigarrfimpar.
As the shares where tendered at a slight premium to net current assets I am pleased. I decided to sell the shares on the market instead of accepting the tendered offer, mainly because it was nice to take some gains of the table.
I entered at 0.181 SGD, so the gain ended up at +124 % for a 18 months holding period.
A quick check on Nippon Antenna gives a P/NCAV of 0.57 at the end of FY 2016. Price is at 599 ¥. Including the 21 ¥ dividend the return is -5.3 % since purchase. Company has a small share repurchase program in place. Will keep position for one more year.
QCCO has been in the portfolio for one year and it’s time to do a follow-up. Price has fluctuated during the year and is at the moment -17% (including dividends). The total dividend during the year was 0.075 $.
The share had a 52-week high of 2.68 $, which was equal to a 60 % gain. Still, a bit short of my get-out early trigger and now the share is in the red.
Glancing the key ratios and balance sheet the share still looks ok, so it will stay in the portfolio one more year.
Time for a one year review of Boom Logistics. At the moment the share is trading at 0.1 A$, which is equal to a -23 % drop.
Boom Logistics was included in the portfolio on the assumption that Plant & Property could be treated as current assets and that the stock was a net-net in disguise. Given this assumption the share price had a big margin of safety one year ago.
The company has faced decreasing demand during the last year, primarily due to due to decreasing commodity prices. However, the company has been been able to sell down underutilized equipment and repay debt so the basic assumption has proven true.
The company is not profitable, but management seem on-top of the situation. As P/NCAV ratio is lower today and there is progress the stock will remain in the portfolio one more year.
*Includes 60% of Plant & Property