Read Interview in Mandarin (715.43 KB)

English Translation of the Interview

SGX-listed exhibition and events management company Cityneon rewards shareholders by paying out 96% of 2006 earnings. This means that shareholders get 96cents for every $1 that the company earned during the period.

Net profit for the year ending 31 Dec 2006 increased by 30.7% to $4 million, revenue increased 40.7% to $41 million, while net asset value per share is 18.28 cents. The group’s earning per share was 5.49 cents while total dividend for the year will be 5.25 cents per share.

Group Managing Director Ko Chee Wah said in the interview, Cityneon’s business model is cash generating, therefore the company does not need too much cash on its balance sheet. The company currently sits on $6million of cash on its balance sheet. Together with the expected $4million cash inflow for the next 2-3 months, the company will have more than enough to pay out the final and special cash dividend of about $3.6million in May.

Mr Ko also expressed that the company wants shareholders to know that Cityneon is a company with high dividend yield and one which rewards shareholders. This way, should the company need to raise money from the market to fund attractive acquisitions in the future, investors will be more receptive.

An analyst who was interviewed by Zaobao a day ago expressed that in the current uncertain market, investors should consider buying stocks of undervalued companies with high dividend yield. That said, investors should still consider whether these companies have sound fundamentals.

In discussing the company’s growth prospects, Mr Ko said, everyone knows our government indicated that one of the main reasons for building the IR is to attract more meeting, incentive, conferences and exhibitions (MICE) to Singapore. This will help stimulate Singapore’s economy, create more jobs and attract more tourists. Mr Ko pointed out that the Marina Bay Sands will house a 1million square foot conference hall for the purpose of holding MICE events.

“As one of the largest exhibition and events management company in Singapore, Cityneon enjoys a certain international recognition. We are in an advantageous position, having provided professional services to international and local exhibition organizers.”

With more opportunities, competition also becomes more intense. Mr Ko believes that some big foreign exhibition and events management company will also look to expand their business here to compete with local companies.

“However, rather than view them as competitors, we prefer to see them as business partners. A lot of times in this industry, competition is not an issue. In Singapore, Cityneon has competitive advantageous in owning facilities, equipments and local knowledge. For these foreign companies, rather than hire hundreds of workers, its better to cooperate with us to provide clients with higher quality service. Because of that, we are in discussions with several such companies with a view to form cooperative alliances.”