Favorite Links

Monday, April 30, 2018

Globetronics on why it is splitting the shares

Monday, 30 Apr 2018
by david tan

GEORGE TOWN: Globetronics Technology Bhd  is proposing a one-for-two share split from 50 sen each into 25 sen shares and issue 96.65 million new shares for its bonus issue exercise.

Group chief executive officer Datuk Heng Huck Lee told StarBiz that the group was splitting the shares because there were requests from overseas and local institutional investors that there weren’t enough Globetronics shares floating in the market.

“We are also proposing to issue 96.65 million new shares for the bonus issue to reward our loyal investors.

“These two proposals will be mooted for approval at the group’s forthcoming EGM on May 8,” he said.

On April 5, the company had announced these corporate proposals.

Meanwhile, the group has also just invested an additional capital expenditure (capex) of around RM30mil to support the forecast increased volume of new light and colour sensors for smartphones and other smart devices in the second half of the year.

“The requirement from our customers is that the forecast volume is much higher than our previously installed capacity. The total amount of capex planned for 2018 could still be revised to a bigger sum in the coming months to support other new expansions,” Heng said.

According to Heng, the group is now in qualification to build another exciting sensor project that could involve an even larger capex.

“If this qualification is successful, we would be expanding our sensor portfolio into environmental sensors for the health device, smart device and automotive industries,” he added.

Heng added that the Globetronics board had also approved an investment of RM11.5mil for one more production floor at its Bayan Lepas plant, due to the rising orders anticipated for later this year.

“We have awarded the civil construction works to start in May, and the first phase of the production floor should be operational by July and the second phase by year-end,” he added.

For the first quarter of 2018, the group posted RM15mil in net profit on the back of RM86mil in turnover. This compares with the RM4.6mil and RM49.8mil achieved in the previous corresponding period.

According to the latest research by Strategy Analytics, global smartphone shipments tumbled 9% annually to reach 400 million units in the fourth quarter of 2017.

“It was the biggest annual fall in smartphone history.

“The shrinkage in global smartphone shipments was caused by a collapse in the huge China market, where demand fell 16% annually due to longer replacement rates, fewer operator subsidies and a general lack of wow models.

“However, on a full-year basis, global smartphone shipments grew 1% and topped an impressive 1.5 billion units for the first time ever,” said Strategic Analytics director Linda Sui.

According to Strategic Analytics executive director Neil Mawston, global iPhone volumes have actually declined on an annual basis for five of the past eight quarters.

“If Apple wants to expand shipment volumes in the future, it will need to launch a new wave of cheaper iPhones and start to push down, not up, the pricing curve,” he said.


No comments:

Post a Comment