UOBKH keeps ‘buy’ on Reclaims Global citing healthy 1HFY2027 results with resilient margins
Tang Kai Jie of UOB KayHian has maintained a “buy” recommendation on Reclaims Global (SGX:NEX) following its recent 1HFY2027 earnings that was ahead of his expectations.
“1HFY2027 revenue of $33.3 million and net profit of $3.8 million is stronger than expected and represent 62% and 55.7% of our FY2027 forecast respectively, underpinned by stronger market demand across all business segments,” says Tang in his Sept 28 report.
Gross profit margin declined 10 percentage points y-o-y to 37.6% largely due to higher diesel prices, while net profit margin remained stable y-o-y at 11.4%, which demonstrates improved operational efficiencies despite the higher diesel prices and two property acquisitions, according to Tang.
On the dividend front, Reclaims Global has declared an interim dividend of 0.25 cents per share, equivalent to a 20% dividend payout ratio. “Management reiterated that they are prioritising the maintenance of a sustainable payout while preserving cash amid the current volatile operating environment,” Tang adds.