EVERGRN (5101) : Stocks With Momentum: Evergreen Fibreboard
Evergreen Fibreboard Bhd
Over the past week, Johor-based Evergreen Fibreboard saw sharply higher trading volume, which drove its share price to rally 5.1% to a high of 62.0 sen, before paring back gains to close at 60.5 sen on Wednesday.
Evergreen Fibreboard produces wood-based products such as medium density fibreboard (MDF), particleboard and a wide range of wooden furniture. The company also manufactures downstream products such as paper, veneer, printed, melamine board laminations and knock down furniture.
It operates seven manufacturing plants in Malaysia, three in Thailand and one each in Indonesia and Singapore. Annual production capacity for its medium density fibreboard (MDF) and particleboard operations exceed 1.30 million cubic meters. The company’s products are mainly exported to Middle East and Southeast Asia.
Over the past two years, the company has been experiencing consecutive annual decline in revenue, from RM1.06 billion in 2011 to RM938.7 million in 2013. Following weak demand from the Middle East, a supply glut in fibreboard and wood products, and rising production and logistic costs, Evergreen fell into the red last year, for the first time since its listing in 2005.
It posted net losses of RM42.8 million in 2013, from net profit of RM32.2 in 2012. This trend continued into 2014, with net losses of RM14.2 million so far for the first nine months of 2014. At its peak, the company chalked up net profit of just under RM120 million in 2007 and 2010.
Evergreen’s balance sheet has a net gearing ratio of 32.5% with its last dividend paid of 1 sen per share in 2012. No dividends were paid in 2013. Although the stock is trading at just 0.4 times book, Evergreen’s fundamentals appear unexciting given the uncertain earnings outlook. The Edge Research rates it a Fundamental Score of 0.75 out of 3.0.
http://www.theedgemarkets.com
Evergreen Fibreboard Bhd
Over the past week, Johor-based Evergreen Fibreboard saw sharply higher trading volume, which drove its share price to rally 5.1% to a high of 62.0 sen, before paring back gains to close at 60.5 sen on Wednesday.
Evergreen Fibreboard produces wood-based products such as medium density fibreboard (MDF), particleboard and a wide range of wooden furniture. The company also manufactures downstream products such as paper, veneer, printed, melamine board laminations and knock down furniture.
It operates seven manufacturing plants in Malaysia, three in Thailand and one each in Indonesia and Singapore. Annual production capacity for its medium density fibreboard (MDF) and particleboard operations exceed 1.30 million cubic meters. The company’s products are mainly exported to Middle East and Southeast Asia.
Over the past two years, the company has been experiencing consecutive annual decline in revenue, from RM1.06 billion in 2011 to RM938.7 million in 2013. Following weak demand from the Middle East, a supply glut in fibreboard and wood products, and rising production and logistic costs, Evergreen fell into the red last year, for the first time since its listing in 2005.
It posted net losses of RM42.8 million in 2013, from net profit of RM32.2 in 2012. This trend continued into 2014, with net losses of RM14.2 million so far for the first nine months of 2014. At its peak, the company chalked up net profit of just under RM120 million in 2007 and 2010.
Evergreen’s balance sheet has a net gearing ratio of 32.5% with its last dividend paid of 1 sen per share in 2012. No dividends were paid in 2013. Although the stock is trading at just 0.4 times book, Evergreen’s fundamentals appear unexciting given the uncertain earnings outlook. The Edge Research rates it a Fundamental Score of 0.75 out of 3.0.
http://www.theedgemarkets.com
