On 15 November 2024, CSE Global Ltd (“CSE”) announced their third quarter business update for FY2024. This is a small business update, which only mentions about the revenue without indication of the other business areas. Its revenue and order book remained strong this quarter and is likely to end FY2024 on the same track.
Disclaimer: Not financial advice. All data and information provided on this site is for informational purposes only.
Photo source: 5 things I like about CSE Global
Financial Highlights
Revenue
| Metrics | Current | Previous |
|---|---|---|
| Revenue | +20.2% | +22.8% |
| Rating | Favorable | Favorable |
Revenue for the 9 months ending 30 September 2024 increased by 20.2% to SGD642 million from SGD534 million for the same period in the previous financial year. The increase was mainly attributed to broad base growth across all business segments. Do note that the order book as of end of the quarter has decreased by 8.5% to SGD633 million, compared to SGD692 million last quarter. The metric is Favorable.
Earnings per share
| Metrics | Current | Previous |
|---|---|---|
| Earnings per share | No Update | +29.1% |
| Rating | Favorable | Favorable |
Based on the announcement on 15 November 2024, earnings per share was not included in the business update for the third quarter of FY2024.
This metric was Favorable in the previous quarter as earnings per share for the first half of FY2024 have increased by 29.1% to SGD0.0231 per share from SGD0.0179 per share for the same period in the previous financial year.
Operating Cash Flows
| Metrics | Current | Previous |
|---|---|---|
| Operating Cash Flows | No Update | +1,487.5% |
| Rating | Favorable | Favorable |
Based on the announcement on 15 November 2024, cash flow was not included in the business update for the third quarter of FY2024.
This metric was Favorable in the previous quarter as operating cashflows for the first half of FY2024 have increased by 1,487.5% with a cash inflow of SGD15.8 million.
Gearing ratio
| Metrics | Current | Previous |
|---|---|---|
| Gearing ratio | No Update | 63.0% |
| Rating | Unfavorable | Unfavorable |
Based on the announcement on 15 November 2024, no detailed breakdown of the financial position, to determine the gearing ratio, was provided in the business update for the third quarter of FY2024.
This metric was Unfavorable in the previous quarter as using the computation for Real Estate Investment Trusts (“REITs”), gearing ratio was 63.0% as of 30 June 2024, with total assets of SGD686 million and total liabilities of SGD433 million.
Interest coverage
| Metrics | Current | Previous |
|---|---|---|
| Interest Coverage | No Update | 5.5x |
| Rating | Favorable | Favorable |
Based on the announcement on 15 November 2024, no detailed breakdown of the financial results to determine the interest coverage was provided in the business update for the third quarter of FY2024.
This metric was Favorable in the previous quarter as the interest coverage stands at 5.5 times as of 30 June 2024. This was computed using profit before tax of SGD20.4 million and interest expense of SGD4.5 million.
Price-to-book ratio
| Metrics | Current | Previous |
|---|---|---|
| Price to Book Ratio | 1.28 | 1.13 |
| Rating | Unfavorable | Neutral |
Based on the announcement on 15 November 2024, Net Asset Value (“NAV”) was not included in the business update for the third quarter of FY2024.
Price-to-book (“P/B”) ratio currently stands at 1.28. This is based on the NAV of the Group as of 30 June 2024 of SGD0.366 per share and closing share price of SGD0.470 as of 3 December 2024. The metrics has shifted towards Unfavorable as you are paying a larger premium for the book value of the asset.
As of 3 December 2024, the Market Capitalization is approximately SGD332 million.
Website: Yahoo Finance: CSE Global Limited (544.SI)
Dividend
| Year | Yield | Total |
|---|---|---|
| 2024 | 5.85% | SGD 0.028 |
| 2023 | 5.85% | SGD 0.028 |
| 2022 | 5.85% | SGD 0.028 |
| 2021 | 5.85% | SGD 0.028 |
| 2020 | 5.85% | SGD 0.028 |
The Company does not have a formal dividend policy, but the Board have represented that they will strive to provide sustainable dividend payout. Since 2015, CSE have been consistently giving dividends of 2.75 cents per share.
With a closing share price of SGD0.470 on 3 December 2024, this translates to a dividend yield of 5.85%. For my benchmark, a reasonable yield would be around 5.00%. CSE dividend yield is Favorable.
Website: Reasonable Dividend Yield 2024Q4 – 5.00%
Summary
| Metrics | Financials | Rating |
|---|---|---|
| Revenue | +20.2% | Favorable |
| Earnings per share | No Update | Favorable |
| Operating Cash Flows | No Update | Favorable |
| Gearing ratio | No Update | Unfavorable |
| Interest Coverage | No Update | Favorable |
| Price to Book Ratio | 1.28 | Unfavorable |
| Overall | Neutral |
Overall, the metrics have shifted towards Neutral to invest in CSE. It is mainly due to the recent increase in share price resulting in paying a high premium for its book value. CSE still have good income visibility and stability from its strong order books. However, do note that there may be a financial impact from the settlement made this quarter. Investors will need to monitor if there are any updates.
Background
CSE is a Singapore-based technology company, which offers total integrated solutions to industries in the automation, telecommunications and environmental sectors. The Company is engaged in the business of systems integration solution and the provision of computer network systems.
The Company operates through Process Controls and Communications & Security segments. The Process Controls segment provides process control solutions that utilize supervisory control and data acquisition systems (“SCADA”), distributed control systems (“DCS”), programmable logic controllers (“PLCs”), motors, drives and plant transducers.
Its geographical segments include Asia-Pacific, America and Europe/Middle East. It offers safety critical solutions, including emergency shutdown systems, process shutdown systems, and integrated control and safety systems. Its products and services are installed on production facilities, as well as on drilling rigs.
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Website: CSE Global Ltd. (SGX: 544): 2024 Half Year Result
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