Haw Par (SGX:H02) – 1Q2019 Results at a Glance

Haw Par Corporation Ltd released their first quarter results for FY2019 on 8 May 2019. Here’s a short review of their performance for this quarter to see what are the changes since our post on their analysis (see link below).



  • 1Q earnings up 14% to $22.1 mil on higher revenue

Haw Par earnings rose 14.1% in 1Q19 earnings to $22.1 million, compared to $19.3 million in 1Q18. Group revenue also increased 22.3% YOY to $73.4mil. This is mainly due to the higher demand of their Healthcare products. It seems like their healthcare segment is still experiencing much growth.

  • Keep the cash coming in

Net cash from operations came in at $6.3mil, net increase in cash and cash equivalent is $10.6mil, boosting their coffers once again.

Their cash holdings now stands at $529mil, which amounts to about $2.40 per share. Together with their Investments and Properties, the amount adds up to $13.74, an increase of $0.53 since our analysis conducted last month.


  • Increase in price for raw materials

Due to higher cost of sales due to increase in price for raw materials, gross margins decreased from 64% to 59%. Management have also stated in the 1Q results that their margins could continue to suffer if price of raw materials continues to increase.

  • Global outlook uncertain

Much of the valuation of their investments are subjected to the global uncertainties and an economic downturn could affect their valuation, reducing their net asset value. If it happens, we have to revise our fair value of this company as one of the most important investment factors we look at when analyzing this company and eventually investing in them is that their sum of the parts valuation is at a discount to their share price.


We will continue to remain vested in this company and might consider adding more in the near future. At current price of $14, investing in them now means that you are essentially buying their investments and properties while getting their healthcare business for free. However, we are keeping an eye on the current macroeconomic situation (eg. trade war) and is planning our portfolio allocation as of now. Till then, cheers.

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