MENU

3 Important Things Investors May Have Missed About SATS Ltd

SATS Ltd (SGX: S58) is a company with two business segments, namely, Food Solutions and Gateway Services. The former covers services such as airline catering, food distribution, and industrial catering. The latter is involved in ground handling services of passengers, flights, ferries, and cargo.

It’s common for investors to miss out on important information about any company. Here are three things about SATS’s business that are not so obvious, but yet important to know for long-term investors:

1. Early history

Do you know that SATS was established as a subsidiary of Singapore Airlines Ltd (SGX: C6L)?

Here’s a history of SATS, as described by the company:

“In 1947, ground handling services were provided by a department of Malayan Airways, which became Malaysia-Singapore Airlines (MSA) in 1967. Five years later, MSA ceased operations and paved the way for two new entities – Singapore Airlines (SIA) and Malaysian Airline System (MAS)…

…As SIA concentrated on its core business of running an airline, the establishment of SATS as a separate, yet wholly-owned subsidiary company evolved naturally. On 15 December 1972, SATS was formally corporatised with 1,673 staff. By the end of the first year, staff numbers rose to 2,000 while gross revenue increased by 25%.”

2. Major shareholder

Today, Singapore’s government is the largest shareholder of SATS. As of 25 May 2017, 40.95% of SATS’s shares were held by Temasek Holdings, an investment arm of the government.

3. Dividend history

To income investors, a company’s track record in paying a dividend is important information to know. And if you are an income investor thinking about investing in SATS, here’s one piece of good news.

Since its listing in 2000, SATS has consistently paid an annual dividend. What’s more, the company’s annual dividend has nearly tripled from S$0.06 per share to S$0.17 per share.

If you like what you've seen, you can get even more investing insights and analyses from The Motley Fool's investing newsletter Take Stock Singapore. It's FREE, so do check it out here.

Also, like us on Facebook to follow our latest news and 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 Lawrence Nga doesn’t own shares in any companies mentioned. Motley Fool has a recommendation for SATS Ltd.