Stock Review: King Wan Corp

King Wan released its Q3 results on 13 Feb 2015. It has been giving consistent dividend over the past few years and the dividend looked impressive.

Extracted from SGX Stock Facts

When I read through the Q3 financial report, I had concerns over a few observations:

1. High Earnings per Share (EPS) was a result from a one-off gain from selling their Thai subsidiaries, which contributed majority of the profit.

2. $36 M unsecured loans payable in 1 year of less or on demand. There was no mention about what they intend to do with this. Their M&E profit of $85,000 for Q3 (or $0.085 M as written in the report) is no way near that amount.

3. $54 M worth of "Available-for-sale investments" on their balance sheet. This was very fishy because I read the accompanying notes but I did not manage to get any information about what made up that $54 M. Considering that their net cash position is in the range of $1 M, the revision of valuation of these assets could create substantial debt/profit.

I suspect the $54 M probably referred to the unsold Skywood Condominium units that King Wan invested in (property development) and the $36 M probably is the construction loan for the property development project.

Sidetracking from their King Wan's M&E's business, their subsidiary Kaset Sugar, listed under SET (Thailand Stock Exchange), looks promising, as it has been King Wan's dividend generator.

Disclaimer: The writer does not own any shares from companies mentioned.