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The Worst-Performing Blue Chip Shares In 2018 (Part 1)

2018 was a challenging year for Singapore investors. The Straits Times Index (SGX: ^STI), Singapore’s stock market barometer, was down by 9.8% in 2018.

There are a number of stocks, however, that saw poorer performance in 2018. In this article, and the next, I will look back into the year and identify six of the index’s biggest losers.

The sixth worst performer

The conglomerate UOL Group Limited (SGX: U14) captures the sixth spot with a 30.2% decline in its stock price in 2018.

As a quick introduction, UOL is a property company that is involved in property development and management, property investments, and hotel businesses.

In its latest earnings for the third quarter ended 30 September 2018, UOL reported that revenue was down 3% to S$523.8 million. Yet, UOL’s attributable profit to equity holders (before fair value changes and exceptional items) increased by 5% to S$92.8 million. The property investment and hotel operations segments saw increases in revenue of 60% and 26% respectively. Both segments saw increases on the back of consolidation of investment properties from United Industrial Corporation Ltd (SGX: U06).

The fifth worst performer

Venture Corporation Ltd (SGX: V03) is the fifth worst performer among the blue chips. As a brief introduction, Venture is an electronics manufacturing services provider with expertise in a wide range of activities.

Overall, Venture had a roller coaster year in 2018. Though its stock price had fallen by 31.9% in 2018, it was trading at a high price of close to S$30, more than double its current price. Various issues like slowdown in the electronics sector and the US-China trade war might have impacted investors’ sentiments.

The real culprit, in my opinion, is its weak quarterly performance for the period ended 30 September 2018. Here are the numbers:

1) Revenue declined 27.4% year-on-year to S$770.4 million;

2) Net profit attributable to shareholders fell 27.9% to S$80.8 million; and

3) As a result, earnings per share was down by 28.5% to S$0.278 for the reporting quarter.

All the factors above would have contributed towards the decline in Venture’s share price in 2018.

The fourth worst performer

In fourth spot is a company that has no significant business presence in Singapore, but is clearly a dominant force in Thailand. It has four main business segments, namely, Spirits, Beer, Food, and Non-Alcoholic Beverages, but derives the lion’s share of its revenues and profits from the first two segments. This company is none other than Thai Beverage Public Company Limited (SGX: Y92), the largest beverage company in Thailand. In 2018, Thai Beverage’s shares plunged by 33.7% in price.

For the full year ended 30 September 2018 (FY18), Thai Beverage experienced a 46.3% year-on-year decline in profit attributable to shareholders, though revenue was 20.9% higher as a result of recent acquisitions. To add on to shareholders’ woes, Thai Beverage’s total dividend per share for FY18 was cut to THB 0.39, down from THB 0.67 dividend per share paid in FY17. To put it simply, it was a challenging year for the company.

Stay tuned for the other worst performers for 2018.

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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.