Venture Corporation Ltd’s Latest Earnings

Venture Corporation Ltd  (SGX: V03) reported its earnings for the quarter and year ended 31 December 2015 yesterday.

The electronic services manufacturer, which operates mainly in the Asia Pacific region, serves a variety of business fields: printing & imaging, networking & communications, retail store solutions & industrial, computer peripherals & data storage, and test & measurement / medical & life science / others.

You can read more about the company in here and here. You can also catch up with the results from the firm’s previous quarter here.

Financial highlights

The following’s a quick take on Venture Corporation’s latest financial figures (note: the company had restated its 2014 financials):

  1. Fourth-quarter revenue for Venture Corporation was up 2.9% year-on-year to S$694 million For 2015, Venture Corporation registered $2.6 billion in revenue, up 7.7% compared to 2014.
  2. Net profit for the reporting quarter was $44.8 million, a big improvement over the loss of $24.5 million seen a year ago. For the full year, profit more than doubled to $154 million.
  3. Subsequently earnings per share (EPS) for 2015 soared from $0.277 in the previous year to $0.556.
  4. Cash flow from operations came in at $109 million for the fourth-quarter of 2015 with capital expenditures clocking in at just $3.2 million. As such, free cash flow was $105.8 million for the reporting quarter. For the full year, Venture Corporation registered free cash flow of $219 million with $233.9 million in cash flow from operations and $14.6 million in capex. The company had free cash flow of $57.2 million in the fourth-quarter of 2014 ($61.2 million in cash flow from operations and $4 million in capex) and $111.2 million in the whole of the year ($167.9 million in cash flow from operations and $56.7 million in capex).
  5. As of 31 December 2015, Venture Corporation had around $459 million in cash and equivalents and $135 million in borrowings. This is an improvement from a year ago when the firm had $393 million in cash and cash equivalents and $169 million in borrowings.

The board of directors had recommended a dividend of $0.50 per share for 2015, unchanged from a year ago.

Operational highlights

Venture Corporation’s bottom-line benefitted from “successful execution on several strategic initiatives including pursuit of operational excellence and value creation.” In its earnings report, the firm also said that it had registered increased traction with several customers and helped support their launch of new products.

The company also added the following outlook in its earnings release:

“Notwithstanding the challenging economic conditions, the Venture Group continued to make progress in growing its profitability, improving its revenue and strengthening its cash generation. Strong execution in engineering design, new product development and operational excellence has resulted in significant value creation and gain in market share.

The Group will continue to pursue its strategy of building distinctive differentiation by developing new strengths, dynamism and capabilities to drive superior performance and stay ahead of competition.

Venture will also focus on new business and product development in several domain areas. The recruitment and development of strong and dynamic technical and management talents is on-going. This is to deepen and broaden the Group’s core competencies for enhanced competitiveness and customer support. Going forward, there will be renewed focus on Venture’s core values with emphasis on bringing the values to life. Enriched by strong core competencies and powered by greater conviction to its core values, the Group will continue to drive sustainable performance and growth.”

So, it appears that the company is moving ahead to expand its capabilities and skills to drive growth.

Foolish summary

At its closing price yesterday of $8.04, Venture Corporation traded at 14.5 times trailing earnings and had a trailing dividend yield of 6.2%.

For more stock analyses and investing tips, sign up here for your FREE subscription to The Motley Fool's weekly investing newsletter, Take Stock SingaporeIt will teach you how you can grow your wealth in the years ahead.

Like us on Facebook to follow our latest hot articles. The Motley Fool's purpose is to help the world invest, better.

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 doesn’t own shares in any companies mentioned.