Raffles Education

[winston]

Not vested.

RAFFLES EDUCATION: Thai authorities are taking legal action against a unit of Singapore's Raffles Education for allegedly operating a school without permission, the Straits Times reported, quoting Thailand's Higher Education Commission.

Raffles Design Institute, the Thai unit, confirmed the brush with authorities and said the problems arose from a misunderstanding, the Straits Times added.

Raffles Education's public relations consultant Citigate iMage said it could not immediately comment on the report.

Source: Reuters

[winston]

Not vested. From DBS:-

HK-based private equity group AIF Capital has opted out of non-binding agreement to take a 10% stake in Raffles Education’s Oriental University City, citing recent global
economic and market conditions.

The agreement that was signed in April would have given Raffles Education S$70m
capital boost if implemented.

[Aspellian]

Published August 25, 2010

Raffles Education posts 2.8% higher earnings of $52.6m
Sales for the year ended June30 fell 7% from a year earlier to $188m
By FELDA CHAY

RAFFLES Education Corp lifted net profit for its fiscal 2010 2.8 per cent to $52.6 million on the back of a fair-value gain, as revenue dipped.

Mr Chew: 'The results are encouraging despite higher initial expenses incurred...'
The group recorded a fair-value gain of $5.8 million on its investment properties in Oriental University City, a self-contained campus in China's Hebei province that provides services to 12 colleges. In FY2009, Raffles Education recorded a fair value gain of $2.2 million and a net profit of $51.1 million.

Sales for the year ended June 30, 2010 fell 6.9 per cent from a year earlier to $188.1 million.

Raffles Education said the drop was mainly due to lower student enrolment at its schools in China.

Earnings per share for the latest year came in at 2.01 cents, a 7.4 per cent fall from 2.17 cents previously.

Net asset value as at June 30 was 21.39 cents, compared with 20.07 cents in FY2009.

Raffles Education chairman and CEO Chew Hua Seng said: 'The results are encouraging despite higher initial expenses incurred with the rapid expansion of colleges in the region.

'The group has continued to grow its strategic presence across Asia amid uncertain economic conditions. This expansion will put us in good stead as global economies strengthen.'

In the latest fiscal year, other operating income dropped and expenses increased.

Other operating income fell to $40.1 million from $45.6 million previously, on a drop in unrealised foreign exchange gains.

Higher headcount resulting from expanded operations also raised personnel expenses to $56.4 million, from $50.8 million in FY2009.

Raffles Education set up eight colleges in FY2010 in Sri Lanka, Bangladesh, Cambodia, and India, boosting its portfolio to 36 colleges in 33 cities across 13 countries. In FY2009 it added five colleges.

Mr Chew said the colleges set up in FY2009 are expected to contribute positively to earnings from FY2011.

The eight colleges set up in FY2010 are expected to bring in positive returns from FY2012. 'New colleges usually require a two- year gestation period,' he said.

Raffles Education said it will continue to set up colleges in Asia and seek to make strategic acquisitions to grow its business. Its cash and cash equivalents as at June 30 totalled $101.6 million.

Yesterday, its shares fell 1.7 per cent, or half a cent, to 29 cents.

[winston]

Not vested. From OCBC:-

Raffles Education: Poor start to FY11

Summary: Raffles Education Corp (REC) released its 1QFY11 results last Thursday, with revenue falling 18.2% YoY and 5.5% QoQ to S$42.2m, or around 19.7% of our original FY11 forecast, as it continues to feel the impact of lower student enrolments (mainly from China).

And coupled with higher operating expenses from its enlarged operations, net profit saw a huge 58.3% YoY and 73.9% QoQ tumble to S$5.9m, or just 11.6% of our full-year estimate.

While core net profit (excluding forex and exceptionals) has also tumbled 68.3% YoY to S$5.2m, we note that it was a turnaround from the estimated S$2.6m net loss recorded in 4QFY10.

The fall in student enrolments appears to be much larger than expected and we think that the numbers are unlikely to recover significantly in the near term. As a result, we are paring our FY11 revenue forecast by 12.2% (FY12 by 11.4%) and earnings estimate by 17.7% (FY12 by 13.3%). In turn, our fair value drops from S$0.33 to S$0.285 (still based on 18x FY11F EPS).

However, we still believe that the worst is likely over for REC, and we should see meaningful earnings contribution coming in from the 14 new colleges REC has established over the last two years. Hence we maintain our HOLD call. (Carey Wong)

[winston]

Not vested. So everyone is now a propery player. Do you know why you are buying ?

Shares of Raffles Education , a Singapore education services provider, outperformed the broader market.

They rose as much as 7.8 percent after BNP Paribas said the firm has identified a partner to co-develop a property it owns in China.

Source: Reuters

[Aspellian]

Reminds me of when Popular Bookstore also set up property arm.

Now we have Wilmar, Raffles Edu etc...

Wilmar - maybe too much cash to spend. Diversify into property and price drop
Raffles Edu - maybe nothing better to invest? (cos do not which edu players out there has fraud!) diversify into property and price increase? haha! irony.

[winston]

Not vested

RESEARCH ALERT-Kim Eng ups Raffles Education to "buy"; target S$0.40

SINGAPORE, Feb 7 (Reuters) - Kim Eng has upgraded Raffles Education , a Singapore education services provider, to "buy" from "hold" and raised its target price to S$0.40 from S$0.28.

STATEMENT: Kim Eng said Raffles Education has obtained approval from the authorities to convert about 280,000 square metres of land area in Oriental University City (OUC) in China for residential development.

The firm is currently in talks with different parties to form a joint venture to co-develop the site and is confident of generating substantial returns based on the targeted selling price.

"Despite the shift away from its core business, we see the move as being (a pragmatic one) that allows Raffles Education to leverage on its low land cost when it acquired OUC back in October 2007," Kim Eng said in a report.

Raffles Education owns and operates OUC in China's Langfang City, around 50 kilometres (30 miles) away from Beijing, according to its website.

At 0153 GMT, Raffles Education shares were up 1.6 percent at S$0.32 on a volume of 8 million shares.


Source: Reuters

[winston]

Not vested. Forward PE 42. No wonder these guys are using SOTP ..

Action & Recommendation

To better reflect the value of RLS’s underlying assets, our primary valuation methodology has been changed to sum‐of‐the‐parts.

We are upgrading the stock to a BUY with new target price of $0.40.

Potential re-rating catalysts are
i) the successful listing of OUC and
ii) a faster‐than‐expected turnaround in enrolment number.

http://www.remisiers.org/cms_images/REC07022011ke.pdf

[Aspellian]

I tot SOTP only used if its a conglomerate with very diversified portfolio companies and there will be unlocking of values.

But if OUC is also part of the education business... isnt it make sense to just use PE.

Faster than expected turnaround enrolment??? will the analyst get lucky this time round? note that enrolment has been dropping previously.

maybe last chance to get out of Raffles Education with higher share price? haha!

[winston]

Not vested. Education not a stable business ?

Raffles Education H1 profits plunges 45% to $11.9m By WINSTON CHAI

Foreign exchange losses and lower student enrolments dragged Raffles Education Corporation's first-half net profit down 45 per cent to $11.9 million, from $21.6 million a year earlier.

For the six months ended Dec 31, the group's revenue fell 15 per cent to $83 million, from $98.7 million.

http://www.businesstimes.com.sg/sub/lat ... 79,00.html?