Thursday, June 8, 2017

'Cautious' - Superln ....... Shareholder / DIRECTOR YEE WEI MEN Disposed Entire Stakes

Its director Yee Wei Men’s disposal of his entire shareholding in the company has raised questions over its future direction. Talks have also surfaced that he might step down as a director. Yee is seen to have been instrumental in turning around the company, expanding the business overseas as well as raising the profile of the company among investors.

However, the counter attracted investor interest rising to a 52-week high of RM3.70 on May 22 2017 from a low of RM2 on June 7, 2016.

On June 5 2017, Superlon underwent a one-into-two share split to improve liquidity, increasing its issued share capital to 160 million from 80 million.

Superlon executive director Liu Han-Chao, an Australian, assures that the company will be on firmer footing, despite talks about Yee stepping down. In fact, the thermal insulation materials manufacturer is expected to post record high earnings in FY17, backed by its centralised warehousing business and plan to strengthen its presence in Indochina.

Yee has been divesting his stake in Superlon since 2016. On April 3 2017, he sold his entire stake but was mum when asked if he intends to remain as a director of the company. He was appointed as Superlon director in January 2013 after emerging as a substantial shareholder on Feb 24, 2012. As of July 26, 2016, Yee had an indirect stake of 10.75% in Superlon.

Observers say Yee had, in his capacity as director of Superlon, assisted the company to expand its market. They also says Yee helped improve relations with investors and this has helped boost its share price.

Superlon’s turnaround in the financial year ended April 30, 2013 was also attributed to Yee, as he is said to have assisted the company in the scrapping of its Klang-based loss-making steel pipe business.

However Yee is not in an executive role. He came in as a board member and gave opinion on what the company should be doing. The company’s improved earnings since FY13 were mainly due to product promotions. Before that, he was not as proactive, but in 2012 and 2013, the company went around to exhibit (its products) and also spoke to consultants and designers of developing projects and buildings to get its products to be approved in buildings.

The company is venturing into Vietnam, which will be a base to penetrate the Indochina market, and to service its existing customers there. Among the services provided are consultation to its construction-based customers in Vietnam.

Superlon is already present in Cambodia, Myanmar and Thailand. Superlon’s customers are mainly retail and construction-based. Retail-based customers are mainly recurring in nature while construction-based customers are mainly on project basis.

For the nine months ended Jan 31, Superlon posted a higher net profit of RM17.34 mil from RM12.96 mil a year ago on the back of a higher revenue of RM73.72 mil versus RM66.81 mil.

Streets opine Superlon is expected to record higher earnings in 2017 compared with FY16 and expect FY18 to be a positive year as the company reaps the fruits from its new warehouse and market expansion plans. Also expect Superlon to remain in net cash position as RM9.6 mil for the newwarehouse has been capitalized.

Superlon exports to more than 75 countries and is ranked top four in the world in terms of market presence.




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