4 Quick Things for Investors to Learn About Super Group Ltd

Super Group Ltd (SGX: S10) is one of the cool companies in Singapore that shares webcasts and/or transcripts of their quarterly earnings presentations (the link for Super Group is here).

The company’s business can be segmented into branded consumer (BC) products and food ingredients (FI). You can read more about Super Group in here.

Below are four short but useful things I learned about Super Group from listening to its webcast for its second-quarter earnings release:

  1. Summing up the second quarter, Chief Financial Controller Koh Chun Yuan highlighted three key points worth noting:
    • EBITDA (earnings before interest, taxes, depreciation, and amortization) margin for Super Group had improved slightly from 16.3% a year ago to 16.4%, even though its net profit margin had dropped from 12% to 9%.
    • Super Group continues to face challenges in terms of weaker currencies in Malaysia, Myanmar, and Eastern Europe as compared to the Singapore dollar and US dollar.
    • The management team remains committed to the company’s three-pronged strategy of product innovation, branding, and geographical diversification.
  1. Speaking of cost, Super Group had maintained its gross margin at 36%, the same as a year ago. It also managed to keep its selling and distribution expenses stable at 12% of total sales. Super Group’s bottom-line was affected by its effective tax rate which rose to 28% versus 12% in the same quarter last year (there was an overseas tax incentive in 2014).
  2. The BC segment contributed 64% of Super Group’s total revenue for the second-quarter of 2015 with the FI segment taking up the rest. This is unchanged from the same quarter last year.
  3. The balance sheet for Super Group remains strong with a debt to equity ratio of just 0.21 and cash and cash equivalents of $103.4 million.

Foolish takeaway

To buy and hold a company’s shares for the long-term also means keeping up with developments in the firm.

The access to management teams via webcasts and transcripts gives the Foolish investor a fair chance to judge for themselves whether they would like to be invested alongside those teams. It also helps us put together a more complete thesis around a company and keep up with developments in its industry.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong owns shares in Super Group