Uni-Asia Group released its results on Thursday 8 November. On initial glance, results definitely isn’t good as it’s been a loss making quarter. After emailing the buyer relationships and taking a while with my thinking cover, the here are my thoughts. 3.5 million for Containerships. Under Uni-Asia’s books they have 4 containerships while 3 of these are subjected to fair value loss. From my research, as of 5 November, it looks like containerships have valued in value by 5%. Nevertheless i would have to continue tracking my research and see if as it happens as panned.
3Q had smaller operating times for Uni-Asia dried out bulks. 736 times. Compared to 3Q 2017 which got 762 days, this is a shortfall of 3.4% of 26 times. If we were to use its charter income as a reference, this might lead to 265 000 to its income. Which would partially describe why its charter income(7.515 million) has failed to outperform 3Q 2017(7.738 million). 3Q 2017 where there were 9 Boats and would create higher income therefore.
Average Charter hire rate each day in 3Q has broken the 10,000 usd tag. By 1H 2018 it was 9875 USD each day and in 9M 2018 it was 9984 USD each day. After some simple computations it amounted to 10202 USD each day in 3Q 2018. I’d say this is in line with my research as seen below quite. To include on, the fair value are assessed by discounted cashflow technique with ‘daily charter rates’ being truly a component in deciding the fair value.
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29.4 million received from its 2nd Hong Kong Property, it offers said in its financial statements that the gains are only partial. Hotel Segments result has improved if pre-opening expenditures aren’t accounted for. With only 1 1 hotel opening in 2019, I would expect pre-opening expenditures to decline and we could see improvement in bottom line.
With relation to the ALERO projects, 2 completed projects has been sold and there can be an additional task under lease. While rent tasks might become sold overtime, an optimistic would become more projects under lease(could contribute rental income) and a task slated to complete in Jan 2019 has been sold. Balance Sheet improvements Largely.
The email address details are definitely not as horrible as it appears on first glance. With more benefits from its property projects to be delivered, i really do stay positive on the ongoing company. Furthermore there are more pipelines because of its Hong Kong properties as well underway. However with 59.3% of its assets in maritime investments, there are definite opportunities for impairment losses and fair value losses to continue that occurs if market sentiments are bad. Having said that, it currently still trades at 0.31 book value.
An important lesson i learnt this time round will be to become more attentive in evaluating how reasonable value are evaluated (especially for the vessels that are under fair value through income and loss). This was something that slipped off in my analysis in previous quarter’s review. My self estimate of the property remaining on that written book as of 30 Sept 2018 would be roughly 11.6 million or 24.8 cents of its resources.