Singpost - Don't count on it for dividends

Singpost is not longer the high dividend paying stock it used to be with the change in dividend policy. With the increased shares due to placement, their latest half year earnings per share is illustrated to be 2.63 cents.

 Extrapolating this to a full year earnings per share = 5.26 cents.

With a 60% payout ratio = 3.156 cents
Dividend yield (last done price $1.495) = 2.11%
With a 80% payout ratio ( last done price $1.495) = 4.208 cents
Dividend yield = 2.81%

The range of 3.156 - 4.208 cents is a fall from the usual and consistent 6.25 cents.

To be fair to Singpost, the earnings per share does not take into account the following:
1) peak shopping season in the second half of the year
2) cost savings due to their Regional eCommerce Logistic Hub which opened only in Nov 2016.
3) Reopening of SPC retail mall in mid 2017
4) Completion of synergies between their acquisitions such as Jagged Peak and Trade Global

4th November 2016 Presentation

5th January 2017 Presentation

Interest rate sensitivity of Sabana

Like a moth to a flame 

Burned by the fire 

My love is blind 

Can't you see my desire?

 - Janet Jackson

So if you have read my previous post about this particular "Hot sweet young thing " friend who recommended me to buy Sabana, she is back to recommend me! After Sabana's price having dropped further to $0.38 from the price of $0.51 when she recommended me. (Due to rights).

Hot Sweet Young Thing ( onwards called HSYT) said:" COme oN, a lousy business is a good investment at the right price. Can you calculate how Sabana will be affected by the rise in interest rate instead of just amplifying what is thrown around about a rise in interest rate and REITS are going to die...PleAse!"

Being a HSYT does have her privileges....so....

To calculate the debt of Sabana post rights

Using the above to calculate Debt

To calculate the distribution of Sabana post rights

With the 3 new purchases, the increment in distribution is assumed to be $6.15 million per year. This figure is attained from investmentmoats.  I agree with his way of calculating this figure. I emailed Sabana investor relations for a post -rights forecasted distribution but they replied that they were unable to provide and told me to wait for the Offer Information Statement ( together with the application forms) which will include more information.

Pre-rights latest distribution annualised based on the table below = 4.77cents per unit.
Pre-rights total number of shares  = 778 million.
Pre -rights total distribution annualised per year = $37.1 million ( $0.0477 times 778 million shares)

Lastest distribution pre-rights for annualised DPU

Interest rate sensitivity of Sabana post rights

Interest rate sensitivity

By the way, it is quite irritating that Sabana isn't able to give a forecasted DPU while other Reits do give. This makes it troublesome to do the above. Arrgh the privileges of a HSYT....