Buybacks surge as corporate earnings season nears end

OVER the five trading sessions from Feb 21 to Feb 27, institutions were net sellers of Singapore stocks, leading to a net institutional outflow of S$265 million, compared to the S$217 million net outflow over the preceding five sessions. This brings the net institutional outflow for the 2025 year to Feb 28 to S$1.1 billion.

Institutional flows

Over the five trading sessions leading up to Feb 27, the stocks that experienced the highest net institutional outflow included OCBC, Yangzijiang Shipbuilding, UOB, Seatrium, Sats, Singtel, Mapletree Industrial Trust, Genting Singapore, Keppel DC Reit, and Frasers Centrepoint Trust.

Meanwhile, the stocks that led the net institutional inflow included Singapore Airlines, Singapore Exchange, Sembcorp Industries, DBS, Yangzijiang Financial Holding, iFast Corporation, Mapletree Logistics Trust, Singapore Technologies Engineering, Thai Beverage and Hongkong Land.

Consequently, over the five sessions, from a sector perspective, financial services and industrials experienced the highest net institutional outflow, while utilities and technology saw the most net institutional inflow.

Share buybacks

The five sessions saw 24 primary-listed companies conduct buybacks with a total consideration of S$31,062,634. DBS led the consideration tally, with 350,000 shares bought back at an average price of S$46.73 a share.

Leading the tally for the non-STI constituents, were CSE Global and GP Industries. CSE Global bought back five million shares at an average price of S$0.46 apiece, while GP Industries bought back 665,700 shares, also at S$0.46 per share.

Raffles Medical Group bought back 210,400 shares at an average price of S$0.92 per share. Last week, it announced plans to repurchase up to 100 million ordinary shares, which represents 5.3 per cent of its total issued ordinary shares, over the next two years.

Initially, these repurchased shares will be held as treasury shares, adding to the existing 26.4 million shares already held. Some of these treasury shares will be used for its employee incentive schemes, while any excess may be cancelled in the future.

These capital management initiatives aim to optimise its capital structure, return excess cash, improve return on equity, and achieve earnings per share accretion.

The group’s cash and cash equivalents totalled S$343.7 million as at Dec 31. It also reported a revenue of S$751.6 million for its 2024 financial year, a 6.3 per cent increase compared with FY2023.

Director transactions

The five trading sessions saw more than 70 director interests and substantial shareholdings filed for more than 40 primary-listed stocks.

Directors or chief executive officers filed 20 acquisitions and no disposals, while substantial shareholders filed four acquisitions and six disposals.

Companies that saw director acquisition filings included ABR Holdings, Accrelist, GuocoLand, Hong Leong Asia, Hyphens Pharma International, IFS Capital, MegaChem, PNE Industries, Singapore Shipping Corp, Singtel, Stamford Land, Trans-China Automotive Holdings, Wilmar International, and XMH Holdings.

Wilmar International

On Feb 21, Wilmar International chairman and CEO Kuok Khoon Hong grew his deemed interest in the global agribusiness by 1,662,800 shares at S$3.07 apiece. This increased his total interest from 14.31 per cent to 14.33 per cent. He has gradually increased his total interest in Wilmar from 12.94 per cent in October 2022.

Wilmar’s non-executive and independent director George Yeo also acquired 176,500 shares at an average price of S$3.09 a share. This increased his direct interest in the global agribusiness to 776,500 shares or 0.012 per cent. Yeo was appointed to the Wilmar board on Apr 19, 2024.

On Feb 20, Wilmar reported that its core net profit for the second half of FY2024 declined by 44 per cent from H2 FY2023 to US$558 million, with full-year core net profit declining 26 per cent from FY2023 to US$1.2 billion. This reduction was partly due to the absence of a US$231 million gain from the disposal of a Moroccan associate in H2 FY2023.

Despite this, Wilmar recorded sales volume growth across most business divisions, with better performance from the food products and plantations businesses.

However, there were lower contributions from feed and industrial products due to weaker performance in sugar merchandising, while the oilseeds business enjoyed higher crushing volume in H2 FY2024 despite weaker crushing margins. There were higher contributions from India and South-east Asia joint ventures and associates in H2.

Wilmar’s integrated agribusiness model encompasses the entire value chain of the agricultural commodity business, from origination, to processing, branding, merchandising and distribution of a wide range of edible food and industrial products.

The plantation and sugar-milling segment contributed 2 per cent of the FY2024 external sales revenue, with feed and industrial products contributing 56 per cent, and the food products segment contributing 42 per cent.

Kuok stated that despite the challenging conditions, most of the group’s businesses reported higher profits in FY2024. However, he noted that this was offset by a weaker sugar merchandising business within the feed and industrial products segment, which had an exceptional year in FY2023.

For FY2025, he expects to increase Wilmar’s market share for the food products segment, building on its reputation as a producer of quality and healthy food. While palm oil refining remains challenging, he is cautiously optimistic about the oilseeds business, with a record soybean crop expected in Brazil in 2025. Barring unforeseen circumstances, he is confident that FY2025 results will be satisfactory.

On Feb 25, Wilmar International appointed Lee Huay Leng as a non-executive and independent director, effective Apr 22. Lee is also the editor-in-chief of the Chinese Media Group of SPH Media.

Hong Leong Asia

On Feb 27, Hong Leong Asia executive director and CEO Stephen Ho acquired 110,000 shares at an average price of S$0.929 a share. This doubled his direct interest from 0.014 per cent to 0.029 per cent. The previous 103,500 shares were acquired at an average price of S$0.519 per share in November 2020.

Ho has extensive experience in finance, treasury and risk management from his executive positions previously held at Wilmar and Dutch multinational corporate Royal Philips.

On Feb 20, Hong Leong Asia announced that its subsidiary China Yuchai International had entered a strategic cooperation agreement with Kim Long Motor Hue, a subsidiary of Vietnam’s Futa Group. The agreement includes technology licences, component supply, and support for constructing an engine factory in Vietnam.

Kim Long Motor Hue will manufacture engines for trucks, buses, and commercial vehicles, with exclusive sales rights in Vietnam and priority rights in other Asean countries and South Korea.

The licences are valid for 15 years, with total licensing fees of US$28 million. Yuchai will provide technical services for equipment installation and commissioning as well as supply all engine assembly parts and service kits.

Singtel

On Feb 24, Singtel’s non-executive director Yong Ying-I acquired 30,000 shares at S$3.28 per share. Her preceding acquisitions were on Nov 27, with 20,000 shares bought at S$3.01 apiece, and in February 2024, with 10,000 shares acquired at S$2.33 per share. Yong has been on the Singtel board since November 2022.

On Feb 19, Singtel provided a business update for the third quarter of FY2025, which highlighted that its Q3 underlying net profit increased 22 per cent on year to S$680 million, or 23 per cent in constant currency terms. This was driven mainly by Optus and NCS, as well as higher profit contributions from Airtel and AIS.

Group CEO Yuen Kuan Moon also maintained that, with the positive momentum and active capital management of the past nine months, the group is making good progress with the Singtel28 plan for growth and sustained value realisation. It also remains focused on capturing growth opportunities in artificial intelligence, data centres, and global connectivity.

ABR Holdings

Between Feb 26 and Feb 27, ABR Holdings managing director Ang Yee Lim acquired 150,000 shares at an average price of S$0.421 per share. This increased his direct interest in the home-grown restaurant operator from 53.80 per cent to 53.87 per cent. Ang has gradually increased his interest from 52.12 per cent at the end of 2023.

On Feb 25, ABR Holdings reported that the H2 FY2024 group revenue increased by 19 per cent to S$71.6 million from H2 FY2023.

For the full year, group revenue increased by 16 per cent to S$135.6 million. All the food and beverage businesses within the group registered revenue growth in FY2024, with the increase partly contributed by new outlets opened during the year.

In line with the revenue growth, gross profit for H2 increased by S$5.2 million to S$31 million, and that for the full year by S$9.3 million to S$57.8 million. The gross profit margin also improved from 41 per cent in FY2023 to 43 per cent in FY2024.

The writer is the market strategist at Singapore Exchange (SGX). To read SGX’s market research reports, visit sgx.com/research.