Aug 28 close: S$0.72
DMG & Partners, Aug 27
EU Yan Sang's Q4 FY13 recurring profit of S$1.3 million (-42 per cent y-o-y, -85 per cent q-o-q) was below our S$3 million estimate as the better margins were mitigated by a higher loss in Australia due to the opening of new stores in H2 2013 and inventory write-offs. We expect the Australia unit to post a smaller loss in FY14 and a profit by FY15, helping to lift profit by ~35 per cent per annum. Maintain "buy", at a higher DCF-derived (discounted cash flow) S$0.92 TP.
BUY
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