KLCI Stock - DXN / 5074 - 2010 Quarter 4

DXN HOLDINGS BERHAD

Listing Date: 30.09.2003
Market: MAIN
Sector: CONSUMER
Par Value: 0.25
Major Industry: Drugs, Cosmetics & Health Care
Sub Industry : Diversified Drugs, Cosmetics, & Health Care
Market Cap : 240764000*0.57 = 137,235,480 (Small)
NTA per share : (196276-11765)/227227 = 0.81
P/BV : 0.57/0.81 = 0.7037
Forecast P/E now : (0.57-0.035)/0.1114 = 4.8 (Moderate)
ROE : 14.47% (Moderate)
DY : 0.035/0.57*100 = 6.14% (Moderate)
Fixed Asset Turnover(4 year) : (0.8324+0.8694+0.7386+0.7027)/4 = 0.7858(Low)
Liquidity Ratio : 191517/104470 = 1.8332 (Low)
Receivables Collection Period : (50865+61488)/2/(259939/365) = 78 days (Acceptable)
My Target Price : 0.67+0.035 = 0.705 (PE 6, EPS 0.1114, DPS 0.035)
My Decision : BUY
My Comment : Revenue and profit decreasing, good cash flow, slightly moderate debt and it decreasing, navps increasing
Technical Support Price : 0.53
Risk Rating : MODERATE

DXN HOLDINGS BERHAD is a Malaysia-based investment holding and provision of management services. The Company operates in five business segments: multi-level marketing, which is engaged in the manufacture and sale of health supplements, and other products on a multi-level marketing basis; property development, which is engaged in housing developing and contracting; energy, which is engaged in the manufacture and sale of biodiesel, and other incidental products; investment holding, which is engaged in investment holding and provision of management services, and others, which is engaged in travel agency and tour operation, information technology consultancy and advisory wholesale and retail of stationeries, household items, gifts and accessories. During the fiscal year ended February 29, 2008, the Company incorporated a 65%-owned subsidiary, Borneo Bio Best (Sabah) Sdn. Bhd. Its product lines include dietary supplements, food and beverages, personal care products and household products.

My study based on 2010 Quarter 4 report (number in '000):-
- The Group recorded revenue for current quarter ended 28 February 2010, representing a decrease of 1.2% as compared to the corresponding quarter ended 28 February 2009. The decreased was due to lower revenue contributed from property development segment
- The Group recorded a lower profit before tax with PBT margin of 12.2% for the current quarter ended 28 February 2010 which included the one off provision of RM 5.65 million for diminution of investment in CLO subordinated bond. By excluding the provision, the PBT achieved shall be RM12.95 million with PBT margin of 21.5% as compared to the corresponding quarter ended 28 February 2009 of RM 8.8 million with PBT margin of 14.4%, the improvement was due to cost efficiency and price revision
- The Group reported lower revenue in the current quarter ended 28 February 2010 as compared to the preceding quarter ended 30 November 2009. The slight decreased in revenue was due to lower contribution from multi-level marketing segment. The Group’s PBT for the current quarter was included the one off provision of RM 5.65 million for diminution of investment in CLO subordinated bond. By excluding the provision, the PBT achieved shall be RM12.95 million as compared to preceding quarter of RM 12.1 million, whereas the PBT margin increased from 19.4% in preceding quarter to 21.5% in current quarter. The slight increased in PBT margin was due to cost efficiency
- Estimate next 4Q eps after 2010 Q4 result announced = 0.1238*0.9 = 0.1114(10% drop), estimate PE on current price 0.57 = 4.8(DPS 0.035)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0397*4*0.8 = 0.127, estimate highest/lowest PE = 5.28/4.49 (DPS 0.035)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.0615*2 = 0.123, estimate highest/lowest PE = 5.81/4.11 (DPS 0.035)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0874*1.1 = 0.0961, estimate highest/lowest PE = 6.87/3.64 (DPS 0.03)

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