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Jardine Strategic Holdings Limited’s Lacklustre Track Record Of Growth

Jardine Strategic Holdings Limited (SGX: J37) is a bona-fide conglomerate, given that it has major stakes in many other Singapore-listed companies.

These companies include the Indonesia-focused automobile distributor Jardine Cycle & Carriage Ltd  (SGX: C07), Hong Kong-focused property investor and developer Hongkong Land Holdings Limited  (SGX: H78), pan-Asian bricks-and-mortar retailer Dairy Farm International Holdings Ltd  (SGX: D01), and international hotelier Mandarin Oriental International Limited (SGX: M04).

One of the things that I like to do when analysing a company is to study its track record. The past is no guarantee of the future. But historical information is the most reliable thing that we can use as our basis to forecast what lies ahead.

And this brings me to the main purpose of this article, which is to have a quick overview of Jardine Strategic’s historical business growth. The table below is a snapshot of the company’s important financial metrics from 2013 to 2017:


Source: Jardine Strategic 2017 annual report

Here are a few points worth noting:

1. Firstly, revenue declined 3.4% from US$32.7 billion in 2013 to US$ 31.6 billion in 2017.

2. Secondly, underlying profit attributable to shareholders had remained more or less flat at around US$ 1.6 billion during the same period. Yet, underlying earnings per share (EPS) was up by 4.5%, mainly due to a reduction in share count through buybacks.

3. Thirdly, although Jardine Strategic’s underlying profit did not increase, it did hike its dividend by 25.5% from US$0.255 per share in 2013 to US$0.32 in 2017.

In sum, I find Jardine Strategic’s track record for growth over the last five years ti be lacklustre. On a positive note though, the conglomerate has managed to increase its dividend at a reasonable annual rate of 5.8%.

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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 Lawrence Nga doesn’t own shares in any companies mentioned. The Motley Fool Singapore has recommendations for Hongkong Land Holdings, Dairy Farm International Holdings, and Mandarin Oriental International.