Global Palm Resources Holdings Limited

[butcher]

Browsed through and noticed no thread on this unnoticed palm company. It is cash rich and started more active shareholder value maximising exercise by shares repurchase. The downside is too small and nobody notice this company.

[idyllic_yawster]

What else do you like about the company?

I see that its net profit has been improving, and cash is nearly 50% of market cap. P/E seems a bit high, though.... the earnings need to catch up.

CPO prices are expected to remain volatile considering the uncertainty in the global economy, increasing
supply of vegetable oils, and abnormal weather’s affect on market dynamics. While the chance of an
El Niño in 2014 has clearly eased, the establishment of El Niño before year's end cannot be ruled out. If
an El Niño were to occur, climate models indicate that it is increasingly unlikely to be a strong event

The demand for palm oil is expected to remain strong in view of rising food requirements from China,
India, Indonesia and emerging markets, as well as demand from the biofuel, oleochemicals and
compound feed industries.
Notwithstanding the volatility and price pressures on CPO, the Group believes that the demand for palm
oil remains sustainable in the long run and will continue to vigilantly review its cost structure, yield and
productivity to ensure that it achieves a cost-competitive model in the long run.

[butcher]

Readed GPR FY14 AR

NAV @ Rp,2467≈ S$0.26
Div @ 0.7 cts which appx 2.5% at current sh px of 20 cts
EPS @ Rp175 ≈ 20 cts, thus PE ≈ 10.8 x trailing

cash & cash equivalents ≈ 10.698 cts per share
total cash @ Rp412,722,129 ≈ S$43.8m seems rather small in absolute terms compared to peers etc

Bearing in mind, this is a small coy, mkt cap ≈ $77.77m and all eqty funded. any small step to goliath peers will be quite meaningful to nimble GPR.



http://infopub.sgx.com/FileOpen/Global%2...eID=342305

[butcher]

CPO prices have been recovering since 31/12/15.

http://www.indexmundi.com/commodities/?c...&months=12

Hope Global Palm recovers it share prices.

[karlmarx]

Global Palm Resources (GPR) recently released its FY2016 results:

http://infopub.sgx.com/FileOpen/GPR_4Q20...eID=440936

1) Like the rest of the palm oil players, the recovery in CPO and PK selling prices has lifted the profit of GPR by a large margin, as expenses remained similar to last year. This prompted a huge dividend declared of $0.0301, against a profit of $0.0253. Management might be feeling positive about the outlook for this FY. At last traded price of $0.34, this represents a yield of 8.85%,

2) Profit from net increase in value of biological assets is small at 1.74% of total profits.

3) The company has no debt. And a healthy cash pile of $0.18; which is 53% of last traded price.

4) The company has been buying back shares since June 2014. The buying has intensified to once every few days over the past year. Treasury shares stand at 6,700,100, which is 3.24% of total shares.

[karlmarx]

Share buyback continues upon the release of its results.

GPR bought back 250,000 of 324,500 total traded shares today at a price of $0.35.

http://infopub.sgx.com/Apps?A=COW_CorpAn...6f2cfa38da

[karlmarx]

It seems the palm oil industry is making a come-back in terms of profitability. Wilmar, First Resources, and Global Palm Resources reported large increases in profitability for 1Q17.

http://infopub.sgx.com/FileOpen/GPRH_1Q1...eID=452987

Using an exchange rate of 0.00011 IDR to 1 SGD, the net profit for the last 4 quarters in SGD, has been recovering:

1Q17: $3.2m
4Q16: $1.4m
3Q16: $2.2m
2Q16: $1.9m

Based on profits of the last twelve months ($8.7m), and last closing price of $0.335 (market cap $66m), GPR is trading at a p/e of 7.58. This appears quite sensible.

However, GPR has negligible debt, and the positive cashflows over successive quarter has risen its cash holding to $44m. It is paying out $6m in dividends on 19/05, which will leave it with $38m. If this is removed from the market cap, the plantation and mill business is valued at about $30m, giving us an ex-cash last twelve months p/e of 3.44. Price to book value is 0.335/0.383 = 0.87.

IPO Investors of GPR, where shares were sold for $0.46, is still in the red since April 2010 when palm oil prices were booming. Is the palm oil industry on the mend, or is this a blip?

[karlmarx]

The frequency of share buybacks has slowed since the release of 1Q17 results. However, the buybacks hit a high of $0.40 today. All 225,000 shares transacted were buybacks, which has been the case on most trading days, since its share price dived some 2-3 years ago.

http://infopub.sgx.com/Apps?A=COW_CorpAn...92769b9240

Currently, the percentage of shares bought back make up about 4.5% of the total number of shares. What is driving the management's buying? And will trading liquidity return to GPR once share buybacks reach the IPO price of $0.46?

[karlmarx]

A day after the release of its 2Q17 results, share buybacks resumed:

http://infopub.sgx.com/Apps?A=COW_CorpAn...fbf1132f8c

Lower selling prices led to lower profits for the quarter, but cash flow remain healthy:

http://infopub.sgx.com/FileOpen/GPRH_2Q1...eID=466919

[Kaimin]

Godamn I just found this site and I love it already, I didn't think anyone would be covering Global Palm because it was too small. I had a Sh** experience with SGX because it fed me bad numbers from stockfacts and I thought average past five years earnings were much higher. I was so excited to find a low pe and high FCF company. In reality it booked losses every 2 years or so from 2012-2016 and same for cash flow. Three days research down the drain.

Joko Widodo has clamped down on giving permits to convert more forest into palm oil plantation. It is impossible for palm oil companies to expand now. In addition, Global Palm has had exactly 16,097 ha of farm land since 2012 (see presentation slides from 2012 and 2017). Probably because of the difficulty of getting a land permit and the political sensitivity surrounding deforestation. So it has no organic growth capacity in Indonesia, short of productivity improvements, which it hasn't made either. Price fluctuations from palm oil is driving recent cash flow and income growth. If you take the average cash flow and net income from the past five years, you'll get a much more accurate (and disappointing) picture of it's cash flows and income under normal circumstances.

It's enormous cash pile is very interesting. Karl, you should subtract liabilities from it first (it does have some). It comes down to about 35% of market cap, still very interesting. The recent share purchases are frankly negligible, a few hundred thousand. More interesting is if Dr Hong, who owns 77% of the company, decides to either take it private or release a substantial amount of the cash. This is the only profitable outcome, given the information above. It's pure speculation at this point, but personally I don't like it. These Indonesian Chinese businessmen types are conservative, bamboo network people. Dr Hong likely sees the business as a family business, not a means of profit. Privatisation is much more likely than a large cash handout. And even then, you'd have to lock your capital up for an indefinite time, waiting for him to do it. It's just 35% return, if it takes more than 4 years you might as well buy the STI or S&P.