Homeritz Corporation Berhad

$HOMERIZ / 5160 (HOMERITZ CORPORATION BERHAD) declares a 3.9sen dividend.

Wow, the special dividends this year are really quite something.

The deadline to declare dividends with payment date before 31 dec is approaching soon. let's see whether there are any other final ones.

$HOMERIZ / 5160 (HOMERITZ CORPORATION BERHAD)
Research by HLIB

$HOMERIZ / 5160 (HOMERITZ CORPORATION BERHAD)
Research by PublicInvest

$HOMERIZ / 5160 (HOMERITZ CORPORATION BERHAD)
Research by Public
Neutral – TP RM0.61

“Improving Sales Orders"

Homeritz’s 3QFY24 headline net profit increased by 46.4% YoY to RM9.1m, primarily attributed to higher sales volume across all regions. After adjusting for non-core items, Homeritz’s core net profit came in at RM8.7m (+66.5% YoY). Results were above both our and consensus estimates at 86% and 94% respectively, due to the higher-than-expected sales volume driven by new customers from Asia and America on new product development. We anticipate an increase in sales volume in 4QFY24 due to seasonality, as customers typically purchase more for year-end festivals. Consequently, we revise our FY24F earnings forecast upward by 6% while maintaining our earnings projections for FY25F-26F. All told, we reiterate our Neutral rating on Homeritz, with a higher target price of RM0.61 based on a 9x PE multiple.

Analyst:
Thye May Ting
thye.mayting@publicinvestbank.com.my

$HOMERIZ / 5160 (HOMERITZ CORPORATION BERHAD)
Research by HLIB
HOLD – TP RM0.62

" No surprises”

Homeritz’ 3QFY24 core PATAMI of RM8.6m (QoQ: +8.1%, YoY: +65.6%) brought 9MFY23’s sum to RM16.5m (YoY: +49.9%), which came in line with ours but above consensus expectations at 75% and 80% of full year forecast respectively. Homeritz continued to see higher sales for 9MFY24 as demand for furniture continued to recover. Moving forward, should the Fed begin to cut rates in 2H24, a potential recovery in the US housing market should lead to higher furniture demand and further benefit local furniture makers. As the US and EU market made up 39% of the group’s FY23 revenue, this aforementioned situation should benefit Homeritz as well. Maintain HOLD with a higher TP of RM0.62 pegged to 8x FY25 core EPS of 7.8 sen.

Analyst:
Tan Je Jyne
JJTan@hlib.hongleong.com.my

$HOMERIZ / 5160 (HOMERITZ CORPORATION BERHAD): Waiting for a Catalyst

$HOMERIZ / 5160 (HOMERITZ CORPORATION BERHAD) has announced its Q2FY24 result on April 26th. Here are some updates.

1. Income Statement
- YoY
Revenue posted at RM57.57mil, increased by 44.64%. While PBT posted at RM11.44mil, 66.53% increased. The increase in revenue and PBT are attributed by increased in volume sold and the strength of USD.
- QoQ
Revenue has increased by 7.09% while PBT has decreased by 6.98% as the decreased of PBT is mainly due to high one-off operating expense incurred in this quarter.

2. Balance Sheet
The company's cash reserves total RM183.86 million, translating to RM0.40 per share. With the current share price at RM0.585, approximately 68% of the company's market capitalization consists of cash.

3. Cash Flow
Positive FCF of RM9.68mil.

4. Management Outlook
Increasing in production costs and fluctuation of Forex are the challenges to the company.

5. Personal Opinion
While the company has achieved impressive results, it's important to consider both the strengths and weaknesses of the organization.

👍 Strengths
📍Robust Cash Reserves: The company maintains a consistently growing cash position, with cash per share reaching RM0.40 this quarter.

📍Resilient Operations: Since its listing, the company has never incurred a quarterly loss, demonstrating stability even during the pandemic.

📍Unique Brand Advantage: With its proprietary brand, the company is minimally impacted by fluctuations in the China furniture market and is difficult to replace.

👎 Weaknesses
📍Insufficient Growth: With minimal capital expenditure each quarter, it appears that the management lacked a commitment to expanding the business.

📍Reduced Dividend: Despite higher profits in FY23 compared to FY19, the company's dividend payout was lower. In FY23, the dividend payout ratio was only 29%, down from 41% in FY19, resulting in a current dividend yield of only 2.74%.

📍Absence of Catalysts: To invigorate the stock price, the company should consider issuing a special dividend since there is lot of cash in the company.

$HOMERIZ / 5160 (HOMERITZ CORPORATION BERHAD)

$HOMERIZ / 5160 (HOMERITZ CORPORATION BERHAD)
Research by Public
Neutral – Target Price RM0.58

“Momentum Going Strong”

Homeritz’s 2QFY24 headline net profit increased by 65.9% YoY to RM9.2m, primarily attributed to higher sales volume across all regions. After adjusting for non-core items, Homeritz’s core net profit came in at RM7.9m (+49.2% YoY). Results were above both our and consensus estimates at 63% and 59% respectively. The discrepancy in our forecast was due to the higher-than-expected sales volume, primarily driven by the acquisition of new clientele from the group's proactive engagement in furniture exhibitions in Germany, Vietnam, and Guangzhou. We gather that sales from the US market are picking up but the orders remain relatively small. All told, we revise up our earnings forecasts by an average of 16% for FY24F-26F, to factor in higher sales volume with acquisition of new customers. We reiterate our Neutral call on Homeritz, with a higher TP of RM0.58 based on a 9x PE multiple.

Analyst:
Thye May Ting
thye.mayting@publicinvestbank.com.my

$HOMERIZ / 5160 (HOMERITZ CORPORATION BERHAD)
Research by HLIB
Hold (Maintain) – Target Price RM0.58

“Picked up by higher sales"

Homeritz’ 2QFY24 core PATAMI of RM8.0m (QoQ: -2.0%; YoY: +50.4%) brought 1HFY24’s sum to RM16.1m (YoY: +42.6%). This came in above ours and consensus expectations at 55% and 59% respectively. The positive deviation was mainly due to higher-than-expected sales volume. We increase our FY24/25/26 forecasts by 13.4%/17.0%/17.9% to account fo higher sales assumptions. Homeritz saw improving sales volumes for 1H24, but we maintain a cautious view on its near-term earnings due to potentially sticky inflation negatively impacting near-term furniture demand. Nonetheless, the stronger USD should cushion any decline in sales volume. Maintain HOLD with a higher TP of RM0.58 pegged to 8x FY24 core EPS of 7.2 sen.

Analyst:
Tan Je Jyne
jjtan@hlib.hongleong.com.my

Quarterly rpt on consolidated results for the financial period ended 29/02/2024

MATERIAL LITIGATIONHomeritz Corporation Berhad ("the Company")
Status of legal proceedings between Embrace Industries Sdn. Bhd. ("Plaintiff") and Khazanah Realty Sdn. Bhd. ("Defendant")

MATERIAL LITIGATIONHomeritz Corporation Berhad ("the Company")
Status of legal proceedings between Embrace Industries Sdn. Bhd. and Khazanah Realty Sdn. Bhd.

MATERIAL LITIGATIONHomeritz Corporation Berhad ("the Company")
Status of legal proceedings between Embrace Industries Sdn. Bhd. and Khazanah Realty Sdn. Bhd.

MATERIAL LITIGATIONHomeritz Corporation Berhad ("the Company")
Status of legal proceedings between Embrace Industries Sdn. Bhd. and Khazanah Realty Sdn. Bhd.

$HOMERIZ / 5160 (HOMERITZ CORPORATION BERHAD)
Research by HLIB
Hold (Maintain) - Target Price of RM0.50

"Another commendable quarter"

Homeritz’ 1Q24 core PATAMI of RM8.2m (QoQ: +12.2%; YoY: +36.2%) came in above expectations, making up 30.3% and 31.2% of our and consensus full year forecasts. We increase our FY24/25 earnings by +7.7%/+5.8% to account for higher sales volume and introduce FY26 forecast. Homeritz’ recorded another commendable quarter on the back of higher sales volume, partially due to yearend festive sales. However, we remain cautious on this recovery as potentially sticky inflation could derail this. Maintain HOLD with a higher TP of RM0.50 pegged to 8x FY24 core EPS of 6.3 sen.


Analyst(s):
Tan Je Jyne
jjtan@hlib.hongleong.com.my

$HOMERIZ / 5160 (HOMERITZ CORPORATION BERHAD)
Research by PublicInvest
Neutral - Target Price of RM0.51

"Steady Start"

Homeritz’s 1QFY24 headline net profit increased by 43.4% YoY to RM9.1m, primarily attributed to higher sales volumes due to festive spending. After adjusting for non-core items, Homeritz’s core net profit came in at RM8.2m (+36.2% YoY). Results were above both our and consensus estimates at 32% and 31% respectively.

The discrepancy in our forecast was due to the higher-than-expected sales volume in the Asia region. While the group has been actively participating in furniture exhibitions (Germany, Vietnam and Guang Zhou) to strengthen relationship with existing customers and seek new customers, we think that it is not likely to have any meaningful impact on earnings. Given a high interest rate environment, we expect furniture demand to remain sluggish in the near term. All told, we keep our earnings forecast for FY24F-26F unchanged and reiterate our Neutral call on Homeritz, with unchanged TP of RM0.51 based on a 9x PE multiple.


Analyst:
Thye May Ting
thye.mayting@publicinvestbank.com.my

General Meetings: Outcome of Meeting

Quarterly rpt on consolidated results for the financial period ended 30/11/2023

MATERIAL LITIGATIONHomeritz Corporation Berhad ("the Company")
Status of legal proceedings between Embrace Industries Sdn. Bhd. and Khazanah Realty Sdn. Bhd.

Annual Report & CG Report - 2023

STATEMENT TO SHAREHOLDERS IN RELATION TO THE PROPOSED RENEWAL OF AUTHORITY FOR THE COMPANY TO PURCHASE ITS OWN ORDINARY SHARES OF UP TO TEN PERCENT (10%) OF THE ISSUED SHARES CAPITAL IN THE COMPANY.

HOMERIZ - Notice of Book Closure

General Meetings: Notice of Meeting

Final Dividend

Change in Nomination Committee - MR TEO SENG KUANG

Change in Audit Committee - MR WONG WAI HUNG

Change in Boardroom - MR TEO SENG KUANG

Change in Remuneration Committee - MR WONG WAI HUNG

Change in Audit Committee - MR TEO SENG KUANG

Change in Boardroom - MR WONG WAI HUNG