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Tradelink
Announces Main Board Listing Details
* * * *
*
Placing and Public Offer of 233,280,000 Shares
at price in the range of HK$1.09 and HK$1.29 per Share
| Investment
Highlights |
- Dominant
market player with over 90% market share
- Professional
management team and strong shareholder background
- Strong
financial position and attractive yield
- New
growth drivers in supply-chain management
service and active trade with Mainland China
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(Hong Kong, 17 October 2005) - Tradelink Electronic
Commerce Limited ("Tradelink" / the "Group"),
a leading provider of electronic commerce service for both
the Hong Kong and international business communities, today
announced the details of its proposed listing on the Main
Board of The Stock Exchange of Hong Kong Limited ("SEHK").
The listing entails an offer of 233,280,000 new shares
in aggregate, of which 209,952,000 shares will be international
placing shares and 23,328,000 shares will be offered to
the public in Hong Kong. The indicative offer price range
is between HK$1.09 and HK$1.29. Assuming the Over-allotment
Option is not exercised and based on an offer price of HK$1.09
or HK$1.29 per offer share (being the lowest or highest
point of the indicative offer price range), the gross proceeds
are estimated at approximately HK$254 million to HK$301
million. New Issue and Vendor Sale accounts for 25% and
75% respectively of the Share Offer. The Government is the
only shareholder participates in the Vendor Sale.
The public offer will begin on 18 October 2005 (Tuesday)
and end at noon on 21 October 2005 (Friday). The allotment
results will be announced on 27 October 2005 (Thursday).
Dealing in the shares of Tradelink is expected to commence
on the Main Board of SEHK on 28 October 2005 (Friday) under
the stock code 536. Shares will be traded in board lots
of 2,000 shares. DBS is the Global Coordinator, Bookrunner,
Lead Manager and Sponsor.
The net proceeds of the new issue will be used for identifying
and developing new electronic services in the logistics
and supply chain related areas and as general working capital.
Mr. Justin Yue, CEO of Tradelink, said,
"We are delighted to witness the achievement of this
major milestone in the Group's development. Tradelink's
successful listing in Hong Kong will be crucial in helping
us to enhance our growth and our capabilities in launching
new services. After our listing, we will move on not only
to strengthen our leading position in the Government Electronic
Trading Services market but also to extend our presence
and influence in the private sector."
Established in 1988, Tradelink was the first company appointed
by the Government to provide Government Electronic Trading
Services in relation to certain official trade-related documents
in Hong Kong. The Group enjoyed first-mover advantages during
the term of the exclusive government franchise between 1
January 1997 and 31 December 2003, giving it a strong base
to continue to maintain the largest market share in the
provision of Government Electronic Trading Services. It
has well over 90% of the market in the Import and Export
Declaration ("TDEC") and the Dutiable Commodities
Permits ("DCP") services for the six months ended
June 2005.
With multiple access channels and a highly scalable and
reliable computer system platform, Tradelink offers a wide
range of reliable and efficient trade-related electronic
services to both the public and private sectors in Hong
Kong. Over the years, Tradelink has built an impressive
customer base of more than 54,000 registered subscribers,
including exporters, importers and manufacturers, carriers
and forwarders. And for them, Tradelink handles over 18
million transactions every year.
Tradelink has a management team known for their close involvement
and ties with trade in both the public and private sectors.
It is also backed by a group of powerful shareholders. The
Government is the largest single shareholder of Tradelink
and the other shareholders are key local players in the
international trade circle. Led by this expert management
team, the Group has maintained a healthy financial position.
Its cash on hand amounted to nearly HK$ 400 million as at
30 April 2005 with zero gearing. Consolidated profit after
taxation for the year ending 31 December 2005 is expected
to amount to no less than HK$85 million.
Going forward, Tradelink is all geared up for growth in
the years to come. In the pipeline, it has ready for Hong
Kong and international users the new DTTN System, an open,
neutral and reliable infrastructural platform for linking
information systems in a supply chain. Covering more than
60 commonly used commercial documents, DTTN provides a convenient
window to trade and transportation service providers, allowing
the optimization of logistics processes by supporting the
major processes and e-documents requirement for international
trade. Tradelink has signed a 15-year operating agreement
with the Government and will pilot run the system by the
end of 2005, with a full launch in April 2006.
Mr. Yue concluded, "Besides readying ourselves for
growth opportunities in Hong Kong, Tradelink is ready to
explore the huge development potential we see for our products
and services in Mainland China. With trading activities
booming on the mainland and the Chinese government forging
ahead with 'informatization' in both the country's public
and private sectors, Tradelink is presented with immense
room for achieving bountiful growth in years to come and
we are committed to generating satisfactory returns to our
shareholders."
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Details
of the IPO:
Offering Structure
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|
| Number
of Offer Shares: |
233,280,000
Shares
(subject to Over-allotment Option) |
| Number
of Placing Shares: |
209,952,000
Shares consisting of 52,488,000 New Shares and 157,464,000
Sale Shares
(subject to Over-allotment Option and reallocation)
|
| Number
of Public Offer Shares: |
23,328,000
Shares consisting of 5,832,000 New Shares and 17,496,000
Sale Shares
(subject to reallocation) |
| Over-allotment
Option: |
34,992,000
Sale Shares, representing 15% of the Offer Shares initially
available |
| Offer
Price Range: |
HK$1.09
to HK$1.29 per share |
| Market
capitalisation |
Approximately
HK$848 million to HK$1,003 million |
| Pro
forma fully diluted P/E multiple based on 05 forecast
net profit |
Approximately
10.0 times to 11.8 times |
| Stock
code |
536 |
Use
of Net Proceeds:
Assuming the
Over-allotment Option is not exercised and based on the
offer price of HK$1.19 per offer share (being the mid-point
of the offer price range), the net proceeds are estimated
at approximately HK$53.8 million and will be applied for.
- Identification
and development of new electronic services (excluding
DTTN) such as the electronic submission of manifest
and advance cargo information in respect of cargoes
carried by road mode of transport, and new services
relating to application of RFID (radio frequency
identification) technology in logistics.
|
40
million |
| |
Remaining
balance |
Profit
Forecast & Dividend Policy
Forecast
consolidated profit after taxation for the year ending 31
December 2005 is not less than HK$85 million.
Assuming
a net profit of HK$85 million for FY2005, payout ratio of
80% and the indicative price range, the dividend yield would
amount to 6.8% - 8%.
It is
the Directors’ intention to recommend annual dividend
as follows:
- Remaining
period of FY05 and FY06: not less than 80% of net profit
after tax
- Thereafter:
not less than 60% of net profit after tax
Track
Record
| |
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For
the 4-mth
ended 30 Apr |
|
For
the year ended 31 March |
| |
|
2005
HK$’000 |
|
2004
HK$’000 |
2003
HK$’000 |
2002
HK$’000 |
|
|
|
|
|
|
|
| Turnover |
|
75,773 |
|
279,706 |
308,481 |
302,748 |
| Profit
before taxation |
|
35,224 |
|
83,554 |
121,499 |
136,512 |
| Taxation |
|
(5,621) |
|
(20,586) |
(23,801) |
(22,347) |
|
|
|
|
|
|
|
| Profit
attributable to shareholders |
|
29,603 |
|
62,968 |
97,698 |
114,165 |
| Excluding
one off item |
|
|
|
|
|
|
| Add: |
Impairment
of investment securities |
|
|
|
|
40,000 |
7,500 |
|
|
|
|
|
|
|
|
| Less: |
Reversal
of provision for termination costs and long service
payments |
|
|
|
|
|
|
11,422 |
| Adjusted
net profit |
|
29,603 |
|
102,968 |
105,198 |
102,743 |
Key
Financial Ratios
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|
For
the 4-mth
ended 30 Apr |
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For
the year ended 31 March |
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|
2005 |
|
2004 |
2003 |
2002 |
|
|
|
|
|
|
|
Operating
profit margin
(before impairment charges) |
|
43% |
|
44% |
43% |
42% |
| Net
profit margin |
|
39.1% |
|
22.5% |
31.7% |
37.7% |
| Effective
tax rate |
|
16.0% |
|
24.6% |
19.6% |
16.4% |
| Return
on equity |
|
33.1%* |
|
39.3% |
43.4% |
N/A |
| Current
ratio |
|
1.81 |
|
2.00 |
1.89 |
1.64 |
| Debtor’s
turnover days |
|
5 |
|
5 |
6 |
5 |
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*Annualised |
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About
Tradelink Electronic Commerce Limited
Established
in 1988,Tradelink Electronic Commerce Limited, a joint venture
between the Hong Kong SAR Government and private sector
shareholders, is a leading provider of trade-related electronic
services for both Hong Kong and international business communities.
Over the years, by perfecting its infrastructure and developing
services that meet users’ practical needs, Tradelink
has earned the trust of the trading community and built
a superb reputation that underscores its dominance in the
public e-trading services sector. It offers a unique range
of customer support solutions, designed specifically to
help customers gain maximum benefits from e-commerce. It
makes the use of electronic services as affordable, convenient
and user-friendly as possible for its customers.
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enquiries:
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