COMMENTS ON BERJAYA SPORTS TOTO BHD (1562)

BERJAYA SPORTS TOTO BHD LAST 5 YEARS SHARE PRICE TREND

**analysis based in 2018 annual report.

1.       GENERAL INTRO: This counter core business in the operations of Toto betting (680 outlets, market leader in Malaysia), leasing of online lottery equipment, and the distribution of computerised lottery and voting systems. BToto’s other business segments include the operation of a hotel in the Philippines and luxury motor retailing in the United Kingdom.

2.       IS THIS COUNTER A STRONG GROWTH STOCK? 

a.       REVENUE RANGE (million): ~ 5660 million in 2018 annual report, this is a high revenue company.

b.      SHARE PRICE: share price on decreasing trend in last few years, from RM4 in 2013 to around RM2 now.

c.       EARNING PER SHARE (EPS): been on decreasing trend in last few years, from 2009 to 2018, from 32.93 sen to 17.05 sen

d.      FUTURE POTENTIAL: Sports Toto remained the market leader among all the Number Forecast Operators (“NFO”) in the country in terms of total revenue. Operating under challenging conditions, due to presence of illegal operators. Recently open new concept store, aim to enhance customer experience.

e.      CAPITAL EXPENDITURE (CAPEX): relatively low, 31.4 million, around 1% of total assets

3.       IS THIS A STRONG DIVIDEND STOCK?     

a.       DIVIDEND YIELD: in 2018 report, dividend yield is quite good, around 7.5%, however the dividend is ~93% of earning, not sure can be sustainable or not, as earning is decreasing year by year

b.      CONSISTENCY: company pay dividend in last 10 years, however, the dividend per share on decreasing trend, from 2009 to 2018, decreased from 29 sen to 16sen.

4.       OTHER INDICATORS:

a.       CASH FLOW: cash flow is still positive, around 437 million

b.      SUPPORT BY INSTITUTIONAL INVESTORS: top 30 major shareholders include few insurance companies and investment funds.

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