Terence Tea, executive chairman and managing director of Accrelist, has been buying back shares of his company on the open market. The most recent transaction filed was on Feb 10, when he acquired 100,000 shares at $4,826.
The purchase brings his direct holdings to around 67.5 million shares, equivalent to 22.22%. In addition, he holds a deemed stake of another 2.4 million shares. In total, Tea has an interest of 69.8 million shares, equivalent to 23% of the company. Earlier on Feb 1, Tea had bought another 100,000 shares for $4,778; on Jan 30, another 100,000 shares for $4,898.
Accrelist controls 53.31% of Jubilee Industries, an electronics manufacturer that is separately listed. In the most recent 1HFY2023 ended Sept 30, 2022, Accrelist says that two of its business units, electronics and mechanical, suffered from lower revenue because of lockdowns in China and broader geopolitical uncertainties.
On Feb 15, Jubilee Industries announced that it will book a gain of $487,000 from the sale of its stake in Bursa-listed EG Industries. “To the fullest extent permissible under the laws, the company intends to return the sale proceeds to the shareholders by way of dividend payment,” says Jubilee, whose chairman is also Tea.
Accrelist’s bright spot is its relatively new medical aesthetics business, which is actively pursuing new opportunities. In FY2022, Accrelist expanded the number of clinics in Singapore from five to seven. Besides opening new outlets, the company has also expanded existing outlets such as the two at Bedok Mall and SingPost Centre.
More recently, in 1HFY2023, Accrelist opened two clinics at Orchard Central and Central@Clarke Quay as part of its move to expand into city areas on top of its existing suburban locations. Accrelist now runs nine clinics in total and there are plans for further expansion.
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In 1HFY2023, revenues from Accrelist’s business segment increased to $6.4 million from $5.3 million recorded a year ago. Despite higher revenues, earnings for its aesthetics business dropped to $0.3 million from $1.2 million as the company incurred startup costs in its two new clinics.
Overall, revenue for 1HFY2023 was $50.7 million, down from $120.6 million in 1HFY2022 ended Sept 30, 2021, because of the drag from the electronics and mechanical business units. Losses in the same period widened from just $3,000 in 1HFY2022 to $724,000 in 1HFY2023.
Growing appetite
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RE&S Holdings, which operates a chain of Japanese restaurants, has started its maiden share buyback programme since the company was listed back in November 2017. On Feb 13, the company acquired back 47,000 shares from the open market at between 25 cents and 25.5 cents each.
Under the current mandate that began on Oct 26, 2022, the company can buy back up to 18.4 million shares. On Feb 15, the company bought back another 10,000 shares, paying 25.5 cents each.
While this was the first time the company bought back shares, its insiders have been known to increase their respective stakes via open-market acquisitions. For example, Hiroshi Tatara, the company’s founder, executive director and controlling shareholder, bought some shares in 2021 at about 25 cents each.
RE&S was founded by Tatara in 1988 and has since then expanded to more than 70 F&B outlets covering 20 distinct brands ranging from fine dining (Kuriya Dining) to family-style (Ichiban Boshi) and convenience (Kuriya Japanese Market).
Just a few days before RE&S started buying back its shares, the company on Feb 10 reported a big improvement in both revenue and earnings in 1HFY2023 ended Dec 31, 2022. Earnings came in at $5.6 million, up 61.7% y-o-y from $3.4 million recorded a year earlier while revenue increased 23.5% y-o-y to $88 million as more customers were able to dine in with the easing of the pandemic. The company’s revenue increased too from more new outlets, with both so-called full-service and quick-service outlets contributing.
The company plans to pay an interim cash dividend of 0.9 cents per share.
“We have continued to drive growth and profitability in our 1HFY2023,” says executive director and CEO Fenton Foo. “We plan to open more new outlets and place focus on expanding both our full service and quick service segments.”
RE&S warns that the F&B industry continues to face manpower shortages while other operating costs and competitive pressures will remain. “The group will keep a close eye on the rapidly changing landscape and deliver on its growth strategies and productivity initiatives,” the company says.
