On 27 Feb 2010, A-Sonic reported FY2010 net profit of US$11.22 million, turning around a net loss of US$1.72 million for FY2009. Although US$8 million of this profit came from the sale of one of its distributorships in North Asia, the $3+ million profit resulting from its core businesses in logistics and aerospace component distributorships is still a remarkable feat.
The company operates its businesses globally, covering 34 cities and 14 countries and spanning 4 continents. Financially wise, it is now sitting on cash of US$31 million (net cash US$22 million) and had a gearing of just 20 per cent.
'We stayed true to our belief,' CEO Janet Tan said in a statement. 'Even during the two toughest economic contractions in 2008 and 2009, and the most uncertain of times, we remained resolute that we should invest in our business for future sustainable growth. By sticking to our strategy, we emerged stronger in 2010.'
From the above statement, the CEO is confident that the worst may be finally over for the company with their strategy of investing in sustainable growth business. She had purchased 5,904,000 shares at S$0.06389 each at open market in 30 Dec 2010 (total cost is about S$380k). Investors will have to wait and see whether she will continue to buy back more shares to instill confidence in the prospect of the company.
A-Sonic is placed on SGX watchlist due to three years of losses in September 2010. At the price of $0.065 - $0.07 and total shares of 719,903,629, the company has met the requirement for their market capitalisation to be above $40 million. Together with the profitability requirement, it is just waiting for 120 days before it will be removed from the SGX watchlist. Will there be more upside to the share when this happens?
Disclaimer: All info posted is for reference only and not an inducement to buy or sell shares. You are solely responsible for your own actions.
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