Wednesday, 22 February 2017

First big spending in 2017

If you had read about 穷小子's style, you would have known that he does not like to have huge spending. Furthermore, he paid them on the spot this time without any much delay. So what did he had bought exactly?

A trip to Turkey, with Air Tickets, Hotels and taxes all in, excluding the tipping and optional. That's right. 穷小子 loves to travel. When was the last time when he spent thousands? Hmm. Think that would be another travel trip, a free and easy to Japan in 2015. He made the payment on the spot at the travel fair last weekend. Don't worry, he had actually did much surveys and comparisons beforehand.
$1389, the exact amount he spent. Fair enough. This is not really a huge amount, but it just doesn't fit into 穷小子's style. Too bad, he just simply cant escape the temptations of it. He loves to explore new things, experience new cultures and interacts with different people. Of course, there is still a passion for his photography. Frugal, but should spent when is worth it, else what is the point for living without its fullest? Experience and passion is something that you can't buy with money literally.

At the travel fair, these are what 穷小子 had observed.

  • There are still a lot of people at the fair. Some maybe for enquires, some may have made the purchase, but the crowd is definitely there. Either we are still far from recessions, or we will only start to fear when the crisis really hit on us.
  • Suntec seems to be losing out at travel events. Natas Fair and Travel Revolutions is held at Expo and Marina Exp respectively since long time ago, if not, for the past 3 years at least. Although the Chan Brothers and other agencies did held concurrently during the same period at Suntec, they are not taking the conventional halls, but only the concourse area.
  • SIA is celebrating their 70th anniversary this year (some good thing to share), and they are partnering with Natas Fair and Travel Revolutions for last and this week respectively. With this, 穷小子 noticed that SIA is available for most of the long-haul flight, this will boost their sales this year if the promotions worked out perfectly for them.
  • 穷小子 will be taking SIA for his upcoming trip as well. He did his homework before the fair since last year. He concludes that the price which he paid for the package tour is lesser than by purely purchasing the air tickets from SIA directly. Flights only to Turkey by SIA is more than $1400, but package tour with hotels is less than $1400. Dont know how they had managed it, but nothing new here, seems like there are some collaborations between SIA and the travel agencies. Not only SIA, other airlines as well.
  • Travel nowadays is definitely much cheaper now than years and decades ago. The YOLO mindset by the younger generations are definitely affecting their parents or even grandparents. Teenagers and young adults are no longer the only target audience anymore, the crowds which 穷小子 observed are occupied by the groups of elder generations actually, who want to travel but avoid the hassles of planning the itineraries themselves.
  • Warren Buffett's Berkshire Hathaway will invest billions of dollars into the US airline industry, for the second time within six months. The move showed a stunning change of heart for Buffett, who once referred to the US airline industry as a “deathtrap for investors.” Time are changing, and we need to adapt and adopt.
  • SIA is hurting by the increase of budget airlines and from the pressure by the fellow famous Airlines brands. How SIA collaborate with travel agencies is an important factor for SIA to cut its edge out from this challenge industry.
  • SIA has one unique advantage over its competitors, after all, SIA is our iconic brand which carries Singapore flag to fly across worldwide. 穷小子 confirm support SIA if the price doesn't differ by much, and bet that most of the fellow locals feels the same way too.

穷小子 not invested in SIA currently, but start to monitor it.

First time going for a guided tour instead of having a DIY trip. How would the trip be like? We will know it in April.

P.S. Hmm. No wonder he can save almost 50% of his salary for 2016, because he only went to Malaysia and Thailand for that year

Saturday, 4 February 2017

Starhub FY 2016 Financial Results

Starhub FY 2016 results was released last evening. Disappointed results indeed, and seems worse than M1. This shall be a short post with no fancy charts or iconic pictures. 穷小子 had no mood to elaborate further but will not sugar-coat the results.
If you had followed 穷小子 throughout, you must have known that 穷小子 had bought the telcos at early 2015, which is around the all time high and is one of the bad moves. Mainly due to the greed on the attractive dividends yield at that time, and no patience. 穷小子 is not trying to bad-mouth the company but serve more of a reminder to himself. Do remember that he is affected as well.
Total telcos shares holdings is about 29.71% of the total portfolio , and among this telcos shares holdings, Starhub is holding at about 47.68% as of yesterday.

In summary, YoY results:
Total revenue, down 2%
EBITDA, down 3%
Net Profit after Tax, down 8%
FCF / Fully Diluted Share, down 15%

More disappointed at the QoQ results:
Total revenue, Non significant changes
EBITDA, down 14%
Net Profit after Tax, down 33%
FCF / Fully Diluted Share, down more than 300%

Most disappointed will be on the dividends.
FY 2016 will be maintained at $0.05 per quarter, but intend to pay a quarterly dividend of $0.04 per quarter for FY 2017.

Moving forward, 穷小子 will not panic sell, but plan to average down slowly whenever possible.
The attractiveness for this stock gets dimmer as the forecast payout for FY 2017 will be at $0.04 per quarter, $0.16 per year, a 20% cut. This greatly change the stories for 穷小子on Starhub, for all the reasons which he bought in the first place.
Next step will be work hard, save more, and build more warchest. The telco industry in Singapore will going to be a long cold war. Embrace for a sell down on Monday, but who knows how Mr Market may react irrationally again.