Based on their latest 2014 Annual Report, I shall summarise briefly the company's Net Worth (a.k.a. Book Value).
Amounts stated are in millions, unless otherwise stated
Assets
Cash
The company holds $298 million in cash and equivalents
Properties and Land
Book Value
|
Liquidation Value
| |
Investment Properties
|
$654
|
$654
|
Leasehold Land
|
$0.283
|
$0.283
|
Total
|
$952
|
$952
|
The company holds the above assets, which probably can be
liquidated close to the above stated value of $952 million.
Investment Holdings
Book Value
|
Liquidation Value
|
||
Short-Term
|
Investments (quoted)
|
$31.6
|
$15.3
|
Long-Term
|
Investment (quoted)
|
$127
|
$63.5
|
Investment (unquoted)
|
$16.6
|
$8.80
|
|
Development property
|
$241
|
$120
|
|
Amt due from associates
|
$85
|
$42.5
|
|
Total:
|
$501
|
$250
|
Assuming a conservative liquidation value 50% of book value:
$250 million.
Receivables
Book Value
|
Liquidation Value
|
|
Trade Receivables
|
$16.0
|
$8.0
|
Amount due from Associates
|
$114
|
$57
|
Cash pledged to bank
|
$39.3
|
$39.3
|
Amount due from
jointly ctrl entities
|
$0.460
|
$0.23
|
Total:
|
$170
|
$104.5
|
As the company is in net cash position, it is unlikely it
will default on its bank borrowings, hence the cash pledged to bank will be
considered 100% recoverable.
Amount due from associates is quite significant. They are
businesses where the company has a 20-50% equity stake in, and are incorporated
in Indonesia, Malaysia and PRC.
Total liquidation value of Receivables: $104.5 million.
Inventories
Book Value
|
Liquidation Value
|
|
Inventories
|
$15.1
|
$7.5
|
Total:
|
$15.1
|
$7.5
|
The book value of the company’s Inventories is after
deduction of allowance for obsolete inventories. So a 50% margin of safety should
be more than sufficient, leading to conservative Liquidation Value of $7.5 million.
Adding the total liquidation values of the above assets, the
total sum is $1.314
billion.
Liabilities
Let's look at what the company owes.
Book Value
|
|
Current Liabilities
|
$134
|
Non-current Liabilites
|
$325
|
Non-controlling Interest
|
$3.08
|
Total:
|
$462
|
Total liabilities and non-controlling interest of $462 million.
Summary
With assets conservatively valued at $1.32 billion and
liabilities of $462 million. The company has a conservative net worth of $852 million.
The company has been in existence since 1957 and was listed
in 1973. The market as on 13th February 2015 is selling this company for $803 million. One can buy $852 million (conservatively valued) worth of assets for just $803 million.
On top of this, these assets based on past 10-year record,
has been generating on average, annual EBT of
$77 million and operating cashflow of around $33 million.
Lastly, this company has been growing its Net Tangible Assets every year for the past 10 years.
Lastly, this company has been growing its Net Tangible Assets every year for the past 10 years.
I'll leave it to the individual to decide if this company, Metro Holdings, is a good buy.
